How COVID-19 reshaped the wine landscape forever – comment

Two years on from the start of the global shutdown, are we now living in a post-COVID world? On the one hand, very definitely not. Somewhat ironically, I'm writing this during a one-week isolation, following my second brush with Batflu in six months. [Apologies, then, if the logic seems somewhat foggier than usual.] That said, my latest infection was the result of a tasting calendar that is, arguably, the busiest I’ve ever seen it. After 20+ months in the deep freeze, the drinks industry has de-frosted and shaken the chill out of its bones with an understandable - if somewhat reckless - joie de vivre. Given both these facts, perhaps it's more accurate to say that COVID is still with us, but is increasingly being redefined as an annoyance rather than a tragedy. And yet, while there is reassurance in seeing some things returning to how they were, this is not the industry of 2019. COVID has left its mark everywhere. Take tastings. Two years ago, Zoom events simply weren’t a thing. Today, they’re an established means of conducting meetings, webinars and online tastings. Of course, people will get back to face-to-face meetings - winemakers will want to visit their key markets, and export managers to doorstep their key clients. But, our newfound familiarity with digital technology has allowed for more creative solutions. Next week, for instance, I’m hosting a discussion with four winemakers from around the world - from Australia, Europe and the Americas. Outside of a globally-relevant trade event, this kind of international panel would have been all-but-impossible to pull together. Zoom tastings have also proved to be a great way of connecting the trade (and consumers) all over the country. The domineering hegemony of big cities hogging all the best events will be, if not exactly over, then at least much reduced. Which is why, even though in situ catch-ups are now available again, virtual events will continue: they’re cheaper, better for the environment and way more convenient for everybody. And, while they’re no longer a replacement for face-to-face tastings, as they were at the height of the pandemic, they're still a valuable addition. There’s a probability that we would have got to this screen-based international interaction in the next five years even without COVID, but there’s no denying the pandemic hurried the trend along. It’s a similar story with online shopping. The decline of the high street has been long-reported, but the growth of digital has accelerated significantly in the last two years. In the process, it’s ushered in two big changes - both of which could have a big impact on the wine category. One of these is the decline of cash. With consumers unwilling to handle actual notes and coins, card payments - particularly contactless - have become ubiquitous in some markets and much more common in most. And, as physical money’s influence withers away over the next five-to-ten years, I wonder whether it might also take some of our traditional thinking regarding price points with it. After all, in many markets, 'five' and 'ten' have been key psychological barriers when it came to pricing for a long time - whether Euros, Dollars or Sterling. Brands waited as long as possible before crossing them, then took a deep breath, jumped and hoped for the best. Now that things are paid for with a wave of a card or phone screen, will this impact - and even that of the entire X.99 price concept - lessen? If so, this would mark a seismic sea-change in the psychology of retail. The other big shift for wine has occurred in the on-premise, which isn’t particularly surprising. Apart from travel, no business was hit as hard by the pandemic as hospitality. One London merchant told me that the on-premise side of their wine business fell by 60% in 2020. Staring into the abyss, businesses were forced to grapple with behaviours that would once have been unthinkable. From Melbourne to Manchester, sacred cows were turned into wagyu. Venue after venue started offering consumers food and drinks either delivered to their door, or for collection. Michelin-starred restaurants became take-aways; bistros became bottle shops. To an extent, this was a means of keeping at least some staff busy and motivated. Nobody was pretending that this approach was going to make up for their core business. But, some venues have seen sufficient benefit that they're continuing with their lockdown additions, even though things are more or less back to normal. Restaurant groups with large databases (or private members’ clubs) have seen it as a way of connecting with consumers who might not come to the physical venue that often. Shipping out parts of the wine list allows them to stay in touch and offers an added benefit to loyal consumers or members. In a business of famously slim margins, even an extra 5% turnover isn’t to be dismissed. Hybrid venues - already offering both off-shelf retail and eat/drink-in - used the quiet time of early lockdown as a means of improving websites and logistics and rethinking portfolios. Many claim to have come back stronger as a result. Interestingly, there’s one final on-premise development that, if it sticks, could perhaps be the most significant of all. Typically, restaurants have been highly reluctant to sell any wines that are on sale in multiple retailers, since it allows consumers a direct price comparison and makes it obvious how much margin has been added to the bottle. That this logic doesn’t seem to apply to a) a fillet steak or b) a bottle of Champagne has always been one of the more puzzling and easily-overlooked contradictions. With the boundaries between on- and off-premise (which were starting to blur anyway) disappearing almost entirely during the pandemic, however, it’s become harder to justify returning to a hard and fast rule that never made a lot of sense anyway. One premium South African producer, who only sold in hospitality, in order to protect his reputation with venues, told me he has been able to expand into the off-premise since COVID without any push-back from restaurants. If there's still a cloud on the horizon for the restaurant trade, it’s the changed working patterns engendered by the pandemic. Few businesses are expected to go back to five days in the office. A working environment of ‘TWAT commuters’ (Tuesday, Wednesday and Thursday) will put immense (and quite possibly fatal) pressure on city centre eateries; particularly those who have relied on business spend. The last two years have seen a fair bit of what we thought we knew about the wine industry thrown up into the air. The blocks are still falling, but the future will belong to those who react to the new order the fastest.