Wine consumers in Brazil adapt their behaviour- Wine Intelligence

Data from Brazil, the first of our consumer surveys about life in the time of lockdown, is giving us glimpses of the stages of consumer experience in the virus pandemic: reduction, restriction, lockdown and re-entry

When the history of the 2020 Coronavirus pandemic is written, many accounts will skate over the important but fairly well-understood process of containing a flu virus, and instead focus on the social and economic consequences of confining a significant proportion of the globe’s population to their own homes for an extended period. Quite rightly, too: such an enforced and prolonged change to our collective lifestyles has never before happened on the current scale, and in such a coordinated way.

As previous blogs have mentioned, Wine Intelligence is in the middle of an ambitious data collection exercise across 14 global wine markets to gauge how wine consumer behaviour and attitudes are changing in response to this immense set of lifestyle and economic changes. We will be publishing key insights as supplements to our existing Market Landscapes reports, starting later this month.

Given this is such a fast-moving situation, and each country is at a slightly different stage of experience and response to the virus, we are characterising each of the markets we are surveying into four states of existence:

Stage 1 Reduction: Where coronavirus cases have started rising, and there is an expectation of government intervention and / or lockdown, yet life is still theoretically ‘normal’. Measures undertaken include self-isolating with symptoms, large mass gatherings cancelled and some travel and movement restrictions. Examples of this would include Brazil in the week commencing 16 March – more on this below.
Stage 2 Restriction: Where virus cases have accelerated, and governments have imposed measures include sheltering for the vulnerable, reductions of all social gatherings, social distancing, extended travel restrictions, move to work from home, some business closure
Stage 3 Lockdown: Where virus cases and deaths rates are accelerating quickly, leading to stay-at-home orders, no public gatherings, enforced social distancing, no non-essential travel with limited movement for food and medical supplies and all non-essential business closed
Stage 4 Re-entry: With the reduction in new cases, government led staged lifting of business, movement and travel restrictions and some form of normal life is resumed, though still with some restrictions in place and the possibility of new restrictions being re-imposed if case numbers take off again

We have just received an initial dataset for Vinitrac® Brazil, which collected data from drinkers of imported wine drinkers in Brazil from 18^th March to 26^th March 2020. The data will be incorporated into the new Brazil Landscapes report, publishing in a few weeks’ time.

According to Rodrigo Lanari, Wine Intelligence country manager for Brazil: “On the day the survey launched, we had our first COVID-19 fatality in Brazil. I would say, in that week, people were very much in preparation mode, moving from stage 1 to stage 2, stocking up on basic items. People were starting to avoid social contact, and where possible, work from home, but there were still people on the streets of São Paulo (the epicenter of the virus in Brazil).”

He added: “Perhaps the bigger news that week was economic in nature. That week, and the previous one, was marked by a massive currency devaluation – the real lost 15% against the US dollar over a period of a few days – and the stock market fell 30%. I would say this was a major impact on the mood of the middle classes, who are much more likely to drink imported wines.”

The data itself points to a population of imported wine drinkers who are becoming increasingly anxious about the future, mainly for economic reasons. Recalled consumption of imported wine is down, slightly, and spend per bottle for off-premise occasions is also down. On premise occasions have fallen dramatically by this point, even though at the time of the survey some bars and restaurants were still open.

As far as more general behaviour is concerned, Brazilian imported wine drinkers say they are significantly less likely to be going on vacation, travelling for work, attending events and playing sports in the near future. Many, not surprisingly, are doing more of their shopping online, including for wine.

Commenting on the findings, Lanari said: “I would expect alcohol consumption to grow as lockdown period progresses, especially wine. I have heard anecdotally that people are emptying their cellars, so consumption may grow while spend remains flat for a period. So, in short, the online trend will grow and, in the mid-to-long term, off-trade (supermarkets particularly) will also benefit from the situation. Wine may be in good shape when compared to hard spirits and even beer, since people are staying more at home and cooking.”

Since the survey closed, Brazil has moved into Stage 2 – Restriction, and may yet enter full lockdown (stage 3) despite overt scepticism from the country’s president, Jair Bolsonaro, who has described the COVID-19 virus as “little flu”, despite protests from his own health minister and more recently the country’s military leadership. Also, in the past week, Google searches for “vinho” [wine] in Brazil have shot up and are now tracking “cerveja” [beer] (see chart). If wine sales do surge, this will fit the anecdotal sales pattern established in other markets where Restriction and Lockdown processes have already happened.