The UK market: center of the wine world and Italy’s wine industry, which is focusing... on itself

This is not the best moment for the international trade of Italian wine. ISTAT (Italian Statistics Institute) data confirmed that shipments suffered a sharp slowdown in the first half of 2023, resulting in a negative sign for the first time since 2020. The reasons for the slowdown in growth over the past few months are numerous. Some are common to all markets, starting obviously from the negative effects of inflation, which has definitely slowed down consumers’ purchasing power. The main reason, though, is the long wave of the Russian invasion of Ukraine, which has destabilized global balances, through pushing up prices of energy and raw materials.
Furthermore, aggravating an already sufficiently complicated and challenging picture, starting from August 1st, in Great Britain, the reform of excise duties on alcohol (which obviously also includes wine) went into effect. Implemented by Britain’s Sunak Government, aiming to discourage harmful consumption, the reform affects beer, wine and spirits progressively. This means that beer, which moves an enormous supply chain, going from production to the dense network of UK pubs, is safeguarded. Still, wine is particularly affected, while bubbles will enjoy even lower taxation. The results could even out for Italy in the future because out of the 380.4 million euros of wine exported, bubbles represent just under half the total: 167.8 million euros. Therefore, there are opportunities and obstacles for Italian wine producers, who are used to and have been struggling for decades in what is structurally the third destination market for Italian wine. And London, of course, is the hub by definition of consumption and trade, while the off-trade channel represents a significantly larger portion of total sales (86%). This is where, at a stone's throw from Westminster, the IEM - International Exhibition Management's “Simply Italian Great Wines” event took place in Britain, led by Marina Nedic and Giancarlo Voglino, in partnership with the UK magazine, “The Drinks Business ”. WineNews met Walter Speller - Italy correspondent for JancisRobinson.com - and the Master of Wine, Peter McCombie. It was a great opportunity to take stock of the short and medium-term prospects of the British market, as well as to talk about communication and promotion. “The key to continued success for Italian wine is quality, both for entry-level and high-quality wines. In spite of the problems we are experiencing, Great Britain is a market where it is essential to be present because it is still the centre of the world for wine. The press, wine merchants and consumers provide unique visibility, it is a springboard for many other markets”, Walter Speller said. Looking at the challenges of the 2023 vintage, the Italy editor of JancisRobinson.com, continued, “producers must not be afraid, nor make it dramatic, because they have demonstrated that they know how to manage the effects of Climate Change in the best way possible, for at least twenty years now. The press has often been accused of judging the quality of a harvest with excessive haste, so it is still early to talk and complain about 2023”.
Taking a closer look at the possibilities and spaces offered to consumers across the Channel, Peter McCombie, Master of Wine, said, “the strength of Italian wine is also its weakness: complexity. There are so many wines and so many territories that consumers often don't know where to start. It can be exciting when approaching wines like Barolo and Chianti Classico, but it is also confusing. The future, though, lies with fresher white and red wines that very often have been underestimated, but can offer excellent acidity, fine tannins, and great drinkability. They need food to best express themselves, because pairing remains a fundamental aspect, and Italian cuisine is still extremely popular. In addition to Prosecco and Pinot Grigio, there is much more to discover, but Italy's wine industry must work hard so that consumers can have access to such wealth”.
The number one marketing tool, however, remains Italy itself. It is “a great tourist destination, especially for people who live in Great Britain. Tourists who visit Campania will, in all likelihood, drink wines from Campania, while those who choose Tuscany will drink Tuscan wines, and so on. We need to work to create connections, and producers must enhance the possibilities created by these enormous tourist flows. I strongly believe that the best way to create a bond with consumers is through your own wine; it must be tasted in Italy, in your company or in a restaurant, and it's even better. We English love Italy, its food and fashion, for us it is the most glamorous country there is, but we need to keep this bond alive”, the Master of Wine, Peter McCombie commented.