WINE: Eyeing Holland's Premium Market
Recent Western Cape Business News
In a bid to build on South Africa’s extremely successful track record in the Netherlands and develop sales in the country’s premium and more profitable arena, Wines of South Africa (WOSA) is embarking on a new marketing strategy.
With a strong accent on consumer and trade education and wine tourism, it will focus on South Africa’s consistent and reliable populist brand champions, its estate and icon wines. The intention is to address more vigorously the potential for packaged wines in the €3 to €5 price segment and higher.
The programme follows on extensive research undertaken for WOSA by international agribusiness specialist Arend Heijbroek of Rabobank International, together with wine consultant Cees van Casteren.
Its goal is to strengthen South Africa’s already well-entrenched position in the Dutch market, where it is the largest New World player and second only to France. In 2008, South African wines accounted for 18,7% of retail sales volumes.
“However, we want to shift from building volume to building value in this critically important market, which is one of the top four destinations for South African wines,” says WOSA CEO Su Birch.
“Currently, South Africa is over-represented in the market below €2, and while it is trending well in Holland’s €5 to €8 segment, it has not fully realised its potential in the mid-priced band, where there are still many opportunities on which local producers can capitalise.”
This, she believes, will require a concerted effort to build distribution partnerships for both on and off-consumption channels. Producers will also need to collaborate closely and work collectively towards enhancing the country’s reputation for quality and exciting wines across the stylistic and price spectrum. “We have to establish a positioning of uniqueness that defines us and separates us from our competitors.”
She says the new programme will be underpinned by the Variety is in our Nature positioning that highlights South Africa’s diversity of wine style, wine-growing terrain and cultures. In addition to advancing the cultural and historical links between South Africa and Holland, it will concentrate on features such as the country’s highly progressive principles of production integrity applied throughout the wine-growing, winemaking and wine marketing processes and that promote sustainability and conservation.
“This is an approach that is serving us well in the UK, where South Africa continues to consolidate its position and remains the fastest-growing player in the market.”
The Dutch campaign will be led by South African marketing specialist Annette Badenhorst, who spent five years representing South African wines in New York, where she worked for Cape Classics before moving to Amsterdam two years ago to represent a number of South African brands.
“Her exposure to intensely competitive markets, as well as to a number of South African producers gives her the appropriate breadth of experience for the new phase in the development of South African wine in the Dutch market,” says Birch.
She adds that that the timing of the new campaign is particularly apposite given the widespread interest in South Africa and the 2010 FIFA World Cup, with the Netherlands having qualified to play in next year’s tournament. “This is translating into great enthusiasm around South Africa, and could also result in higher than usual tourism to our country, which should impact positively on our wines.”
According to the Department of Trade and Industries, South Africa’s wine exports rose in value from R4,7bn in 2007 to R6,2bn in 2008.
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