Wine brands in Germany: Changing times- Wine Intelligence

The recent lockdown period may provide an acceleration to an emerging trend in Germany’s wine market towards more aspirational, consumer-centric brands, promoted on social media and sold through the market’s growing wine e-commerce channel

The market for wine in Germany has a deserved reputation for being a very value-driven, low-priced environment with a big share of wine being sold through discounters. In such a harsh environment, profits are hard earned, and change – when it happens – has traditionally been evolutionary and cautious.

Is this picture about to change? Quite possibly, according to the latest insights from the Germany Wine Landscapes 2020 report, which we publish tomorrow. The mood from the trade, possibly accelerated by some changing behaviour as a result of the Coronavirus pandemic, suggests there is a wind of change blowing through Germany’s wine aisle – driven by a mixture of young wine producers, entrepreneurs, new routes to market, and a new appreciating consumer sentiment.

At the heart of this change appears to be a new, but long overdue, focus on what German consumers aspire to, rather than what they will trade down to. A new generation of winemakers and marketers appear to be harnessing the power of customer understanding to tailor an offer more closely to the needs of their target audience. With communication and channel strategies that are exploiting the ability to connect directly with consumers, new brands have created some orientation and appeal to younger wine drinkers who would usually not necessarily drink wine. Social media – Instagram, Facebook, etc – play an increasingly important role in the marketing mix. Mixed with other features of contemporary culture such as electronic music or festivals, they have managed to get emerging wine drinkers involved. By creating a product that fits their taste as well, they have created a connection with their consumer. Even though their awareness rates are not as high as other more established brands in the market, their connection rate (affinity for the brand, recommendation to a friend) are easily keeping up or even surpassing the big players in the market – which is a very promising base to start from.

These changes seem to have been boosted rather than held back during the Coronavirus pandemic and the lockdown period. Consumers have stayed engaged through various online tastings and social media interactions. The existence of a number of well managed and effective e-commerce platforms in Germany has added fuel to this trend, given the difficulties (real or perceived) of going into store during the lockdown period. Brands that managed to consider new occasions during lockdown and that tailored their digital communication to the new habits and applied non-traditional marketing strategy are the winners of the crisis. Reacting quickly to the new occasions and offering new experiences to all consumers has the potential to create a strong connection with young consumers and will help to get them more involved in the category.

And as the data shows that they are more open to other alcoholic beverages outside of wine – eg spirits, cocktails, liqueurs and pre-mixed drinks – it is vital to create new, interesting and easy-to-drink products that keep wine in the mix amongst younger consumers.

Author: Tina Fruth