Sparkling wine is at a crossroads. While it has shown more resilience than other alcoholic drinks categories, an over-reliance on developed markets and a relentless push towards premiumisation threaten to reverse its growth trajectory under a more uncertain macroeconomic landscape. Champagne and other sparkling wine are shaped by different dynamics. Champagne acutely faces the challenges of an economic slowdown and a focus on traditional consumption occasions, while other sparkling wine benefits
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Key findings
Heavy reliance on developed markets and premiumisation create challenges
Despite a resilient performance post-COVID, global sales of sparkling wine remain heavily skewed towards mature developed markets, which may limit growth prospects. Modest volume growth opportunities encourage a continued premiumisation, although this trend is increasingly challenged by low levels of consumer confidence in key developed markets, notably in Europe.
More casual and diverse consumption occasions spur innovations
Other sparkling wine is less associated with consumption for celebrations than Champagne and is more frequently drunk for casual social occasions, which brings potential for more varied products, thereby encouraging innovations. In a fragmented category, the largest players see increasingly intense competition from private label.
Other sparkling wine benefits from downtrading but faces price pressures
Other sparkling wine such as Cava, Crémant and Prosecco recorded robust global sales growth, as the category continued to focus on premium wines, benefitting from trading down from Champagne and from their perception as an affordable treat. However, intense price pressures in major European markets may indicate a malaise whereby discounting could be needed to maintain sales.
Champagne faces multiple challenges due to macroeconomic conditions and climate change
Champagne sales, a barometer for consumer sentiment, are vulnerable to an uncertain economic landscape. Low consumer confidence in European markets hit growth and rising geopolitical tensions as US political forces disrupt global trade flows may curb Champagne sales further. Climate change could create more challenges by boosting the competition from other wine areas.
Competition from RTDs and non-alcoholic wines also brings opportunities
In developed markets, sparkling wine faces long-term challenges linked to a more moderate alcohol consumption among young adults compared to previous generations, alongside their growing preference for other types of drinks including RTDs. This may prompt sparkling wine brands to innovate and offer non-alcoholic wines and wine-based RTDs using cocktail recipes.
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Key findings
Global sales see brief post-COVID sparkle but fails to expand its global reach
Global sales remain heavily reliant on highly mature and crisis-hit markets
Resilience expected in most large markets; Germany and Spain set to face saturation
Other sparkling wine forecast to outperform still wine, strong headwinds for Champagne
On-trade channel set to face continued headwinds linked to socioeconomic shifts
Perception as affordable treat helps growth amid price pressures but slowdown looms
Germany: A “canary in the coalmine” showing pervasive downtrading trends or outlier?
US: P opularity of other sparkling wine driven by shift to casual consumption occasions
Champagne at a crossroad s as brands shift more clearly towards premiumisation
France: P rice polarisation shapes competitive landscape amid volume sales declines
UK: Champagne brands focus on exclusivity amid challenges and price polarisation
Champagne as a bellwether for global economic growth but faces unique constraints
Other sparkling wine: M ajor players retain a solid lead despite private label challenges
Oetker Group makes gains outside Germany helped by shifts in consumer attitudes
Champagne: Major brands retain halo effect of on-trade presence but face price battles
Shift in consumption habits, celebrity backings and wine tourism may fuel innovations
Hampton Water Bubbl y rosé targets democratisation and casual drinking occasions
Scavi & Ray targets a relatively untapped niche with a low - alcohol Prosecco extension
Ruinart Blanc Singulier 2019 vintage communicates around climate change’s impact
Nicolas Feuillatte targets a younger audience with a new bottle designed by singer Mika
Launch of Leonardslee helps build consumer awareness of premium Sussex wine
Climate change: C hallenges for incumbents amid rise of emerging countries of origins
Looming US import tariffs and potential trade wars may lead to downward spiral
Ageing consumer base expected to fuel innovations to capture rising demand for RTDs
Key takeaways and recommendations
Alcoholic Drinks
Alcoholic drinks is the aggregation of beer, wine, spirits, cider/perry and RTDs.
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