Mexico is creeping slowly onto the radar of the wine trade. But what are the reasons behind Mexicans’ growing enthusiasm for vino?
Mexico is gradually earning its place at the table of major wine countries – wine consumption in Mexico has been growing at significant rates for over ten years. Per capita consumption of all wine styles is currently at 1.3 litres, representing a 3% growth on 2011, or a 6% growth on 2014. 7.5 million 9l cases of wine were imported in 2015, representing an 8% increase on 2014.[1]
In recognition of its growing importance to the world of wine, Wine Intelligence has been investigating the Mexican wine market for two new reports: Mexico Landscapes and Mexico Generations. During the research process, we have unearthed 5 principal reasons which go some way towards explaining the vigour with which Mexicans are embracing wine:
- Changing lifestyles and demographics: Mexico is the 2nd largest economy in Latin America, and currently ranks as the world’s 15th largest. The economy continued to expand at a moderate annual rate of growth of 2.5% during 2015, and is predicted to grow by 4% in 20161, despite depreciation of the peso and lower oil prices. As a result, the middle class is growing and in 2015 accounted for 47% of the total households in the country.
This growth of the middle class means that, for more and more people, wine is increasingly accessible and desirable as part of an aspirational lifestyle. In fact, Mexico is the largest luxury goods market in Latin America, having overtaken Brazil in 2012.[2] More women are going into the labour market, and young people have increasing spending power. Mexican cities are becoming increasingly cosmopolitan, and the wine drinking culture is expanding beyond Mexico City into other cities and urban areas.
- Availability of a wider and better range of products: Twenty years ago, wine was represented in stores by a limited selection revolving around either cheap Mexican or Californian wine (often sold in tetra-packs or other large formats) or a few Old World brands. Nowadays, consumers enjoy a wider and greater range of wines, with eye-catching designs, accessible pricing and appropriate flavour profiles, led by New World brands but with some notable Old World brands leading too. Importers to Mexico benefit from the fact that Mexico has one of the most open large economies in the world: Mexico has been part of the OECD since 1994, and has free trade agreements with more than 50 countries including: the USA, Canada, European Union, Chile and various other countries in Central and South America. Over 90% of trade is conducted through these FTAs.
- Wine, to put it simply, is trendy: Drinking wine is considered sophisticated, and along with other beverages such as craft beer and mezcal (a spirit made from agave, similar to tequila) has benefitted from a high demand for artisanal products. Moreover, points of sale have recognized the potential that wine has in this market and are investing in initiatives to educate consumers to ensure the trend sticks around. This includes everything from in-store displays with wine and accessories, to tastings and information on posters educating consumers about food pairing and grape varietals. All this allows consumers to make more informed and confident choices and gradually become more involved in the category.
- Domestic production is making the category grow for everyone: The recent growth of domestic production is also helping to bring new consumers into the category. It’s increasingly popular for the middle classes to visit Mexican wineries or follow the Wine Route in Baja California; this reflects a growing interest in wine. The prominence of Mexican wine means that wine is now seen by many as a Mexican drink.
- Wine is seen as healthier than other beverages: An increasing focus on well-being means people are drinking less beer and spirits, and awareness of the health benefits of red wine is growing. Many people are being recommended wine by their doctors to help them fight high blood pressure or to lose weight.
Find out more in our Mexico Landscapes and Mexico Generations reports, out this Thursday. If you’d like to enquire about purchasing this report, please contact Eleanor.
Author: Eva Maitland
[1] IWSR
[2] http://luxurysociety.com/articles/2016/06/is-mexico-the-next-luxury-industry-goldmine
