Chile comes into its own

Then I saw the recent article in Harpers, "Own label is damaging Chile, says top producer" where it states it is "retailers' own label products, not price promotions that were most damaging to Chile's image".

Well I would suggest you look back over the growth of Chilean wines in the UK over the last 10 years and identify the forces that originally drove the growth of Chilean wine in the UK.

Bereft, at that stage, of any key brands, the single, most significant vehicle in growing the Chilean wine category, was the enthusiasm for, and the belief in the Chilean wine potential by the grocery multiples.

Whilst Australia and South Africa had strong brands from the outset, this was clearly not the case with Chile; yes there were a few brands, however, they did not set the stake in the ground and spearhead the campaign at that stage; now that Chilean market share, at over 6.5%, and growing way above category average, is focussing our attention, we need to analyse why.

Quite simply because the consumer now believes in Chile, and has developed confidence; in fact, in various surveys, Chile is identified as the wine producing country delivering best value for money at the 5 price point.

And why? Because retail buyers saw the potential and value in Chile, identified the lack of strong brands at that stage, and set the ball rolling, through own brand so please, don't bite off the hand that fed the Chilean wine industry in the UK a few years ago!

Looking at stats, Chile is one of the least brand dominated sectors in the UK at present - yes brands are now growing, but historically weak .. and I am delighted to see a strong generic campaign, and a focussed approach by Chilean brand owners to drive the branded sector of the category, particularly above the 5 mark.

However, at the risk of enraging brand owners, who can look back a few years, I firmly believe that the growth of the Chilean category was driven by the focus and attention given by retailers on their emerging ranges of Chilean wine - great quality, great value, and five years ago, own brand dominated brand within this sector and was the driving force.

Multiple grocers are the quickest route to market; multiple grocers and convenience chains are where over 70% of the wine buying public buy their wines.

Own brand is a crucial part of that mix, and in the case of Chile, has played a vital and integral part in the development of this sector in the UK. The consumer is happy with Chile at around 4-4.50 why?

Because supermarkets have delivered range and value for money in droves, for Chile. As an ex-buyer, my mantra was always - "be objective, think of the consumer" and this is exactly righthowever, I would hazard a guess that I, and several of my fellow, grocery multiple buyers have a less than well hidden admiration for Chile, because it does deliver at the crucial 5 mark, and its average price point is already considerably ahead of South Africa.

Criticise promotions? Potentially. Criticise what the retail industry has done and is doing for Chile, via own brand? Categorically no! Before the welcome advent of Michael Cox and Wines of Chile, and before the realisation by UK importers that Chile was a brand on which to build, own brand dominated the Chilean sector in the UK, with potentially the best value and quality throughout the own brand range.

Own brand, and the inherent quality and value for money that it offered is what first gave Chile a helping hand onto the UK market so let's not "diss it" now. And retailers are firmly focussed on driving this category, on communicating to consumers and to get their faithful, and trusting own brand supporters onto the bandwagon. Tesco have just launched 24 new variants to its Finest Range, Morrisons have just pushed the price point with the relaunch of The Best

Own brand plays a vital part in the marketing and consumer education for mainstream wine buyers, and no one should forget this. On-trade and specialists form an important part of the critical mass, but in terms of developing Brand Chile', then this is the role of the retail outlets.

Where brands are strong, focus on these, as long as quality delivers; where brands are embryonic, use whatever power you have to convey the message.. Consumers who trust a retail brand, will trust a retail wine brand my plea to retail buyers now, is to maintain quality, especially in this area, where own brand still dominates..

The UK market can be compared to shifting sands at the moment, both in terms of trade and consumer; There will be seismic changes within the industry, in all aspects within the next two years.

However, given route to market, and having identified where most of our consumers are spending their money, I would be loath to criticise own brand and I would urge brand owners to review the role of own brand within total category, before sharpening spears! And I promise to write about life outside retail next month.