UK: Discount-seeking threatens Champagne profits
An increasing array of discounts and multi-buy promotions is tempting some people to buy Champagne more often than the traditional once or twice a year.
But in a worrying development for Champagne producers, a significant proportion of core, regular Champagne consumers are seeking out a discount every time they shop for Champagne and will go to great lengths to buy their fizz cheaply.
The findings are contained in a new report from market research specialists Wine Intelligence.
The report also shows that despite the increasing association with discounts, most people retain a very high perception of Champagne brands. In fact, many people interviewed in the survey, which took place in branches of Sainsbury's, Majestic and Oddbins over Christmas and New Year 2002-03, didn't remember that they were getting a discount on their Champagne purchase despite having a discounted bottle in their basket.
As well as cataloguing the behaviour of serial discount fans, the study identified two desirable consumer segments that are highly brand loyal and do not require discounts to prompt a purchase.
'Brand Advocates' are a small, but influential, group of Champagne consumers who know their favourite brand by name and are unlikely to buy any other brand; they tend to be married, in their forties and fifties, and predominantly male. 'Socialites' on the other hand are far more concerned with the image their Champagne consumption projects, and will most often buy it in the off trade; they tend to be younger, single professionals.
Commenting on the findings of the report, Richard Halstead, managing director of Wine Intelligence, said: "This research confirms the Champagne sector's worst fears about the importance of discount in the marketing mix. Having said that, this report shows there are still a lot of opportunities for intelligent marketers to target desirable audiences in the Champagne market."
The report is available as an electronic (.pdf) download from Just-Drinks.com for the price of £489 excluding VAT.
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