Greg Sherwood MW: Are wine ranges going to expand or contract?

The past few weeks seems to have been a pretty busy time in the London wine trade as numerous international producers descended upon the capital to pound the pavements, meet and greet and generally reinvigorate their various business and consumer channels after a noticeably sluggish and cautious start to Spring for many merchants, restaurants and retailers.

Customers, on the other hand, certainly do seem to be fairly thin on the ground at the moment as many families have taken the opportunity to travel further afield for a proper Easter break after the pandemic disruptions of the last two years.

Undoubtedly, the onset of the international wine judging season with the commencement of the International Wine Challenge tastings and Decanter World Wine Awards in the next couple of weeks has also acted as an additional attraction for many visiting wine trade professionals who join the various tasting panels for several days or longer. But with the uncertainties of the 2023 global economy becoming more and more apparent, many wine merchants are going to have to up their work rate and improve their offerings if they are going to match let alone exceed the wine sales of the past year or two.

What is not in doubt is that every producer visiting the UK is desperate to try and increase their sales in a noticeably unresponsive consumer market. But for many of these wineries, what exactly is the most expeditious way to try and achieve this? For numerous producers from South Africa that I have met up with over the past weeks and months, many seem to be seriously considering rationalising their offerings to the UK market with an added focus on fewer but more premium high-quality brands, while the other half seem to be contrarily contemplating the merits of further value brand extensions, primarily for the more affordable end of the wine market. So who is pursuing the correct strategy, or could they both possibly be correct?

The list of premium South African producers who set out with the express intention to keep things small and compact, especially when it came to their wine ranges, is long indeed. Some of the most famous include the Polkadraai Hills winery De Toren, who famously set out to produce only one flagship wine in the form of their five varietal Bordeaux blend Fusion V, only to decide that the numerous off-casts, as there were obviously always going to be when undertaking such an ambitious large scale blending endeavour, where far too good to sell off to other wineries, thus leading to the birth of the now famous Edition Z right bank styled Bordeaux blend.

Admirably, super focused premium producer Mike Ratcliffe of Vilafonté has stuck to his guns, more or less, focusing almost exclusively on his impressive Series C and Series M creations, well, that is of course until his Seriously Old Dirt brand that also started life as off-casts of Vilafonté, took on a life of its own to grow from an initial 12 000-bottle production to currently over 200 000 bottles with its own dedicated winemaker, all the while tapping into new and unexplored consumers segments.

Another very notable producer to follow the unexpected expansion route is Duncan Savage, who famously swore blindly that he only wanted to ever make two scalable wines, namely his Savage White and his Savage Red. But we all know that for someone as ambitious and inquisitive as Duncan, two wines were never going to suffice as indeed his now rather superb eight-wine range bares testament to today.

Brand extension has indeed been a popular way to grow one’s market share and market presence, with Naudé Family Wines introducing his Langpad Old Vine Colombard, the Oupa Willem Cape Heritage red blend and his soon to be revealed Colombard / Chenin Blanc white blend. Then of course there is the dynamic Sakkie Mouton who certainly “got his cray on” expanding his range beyond his initial Revenge of the Crayfish Chenin Blanc cult release, to include a Chenin Blanc-based white blend in the form of his Full On Misfit, a Vermentino under his Sand Erf label and more recently a very impressive old vine Colombard under the Vloedvlak brand. For a youngster like Sakkie, brand expansion seemed a very natural course to follow with all the incredible old vine fruit he had instant access to in the Vredendal and Koekenaap regions and the market has certainly embraced these high-quality new editions.

The brand extension route has also not been the sole preserve of the more traditional, classical brands like Taaibosch and their Le Chant red brand or Waterford with their Antigo red blend offering, as I was thrilled to discover when I met up recently in London with Chris Groenewald from the resurrected Swartland Smiley brand, in which he has now become a business partner with Michael Roets. The super juicy Smiley Fresh Non-Vintage brand (primarly from the 2022 vintage) not only has an equally iconic cartoon style label as the original Smiley NV, but the quality in the bottle is impressively well made, accessible and commercially attractive. After all the trials and tribulations with this project, a reset and resumption of marketing in the UK has certainly been long overdue. Let’s hope that consumers are as receptive to these impressive new releases as they were to the original ground-breaking Smiley NV releases all those years ago.

What these producers all seem to believe is that they can grow their business and market share by growing their ranges, with greater market penetration through not only quality offerings but also increased volumes of more diverse wine offerings. None of these producers can however be accused of letting quality standards slip as all the product range additions have been well planned, of high quality, and importantly, visually very well-conceived new brands that have found a welcoming consumer market with relative ease. No suggestion that a shotgun approach has been adopted to hit more targets, rather intelligent segmenting of the market and then creating products that these producers believe will be well received.

Expand or rationalise to grow? That seems to be the question on every winemaker’s lips. Segmenting the market and segmenting your offering more acutely can certainly lead to a more coherent and effective brand strategy. It certainly worked for Chris Alheit who banished the demons of diversification when he eventually canned the Flotsam & Jetsam Cinsault and Chenin Blanc range and doubled down on his efforts to grow and improve the quality and presence of his Cartology brand. In a similar vein, Eben Sadie followed a similar strategy when he decided to discontinue the much-loved Sequillo red and white brands.

These decisions undoubtedly made sense within the context of these producer’s broader brand strategies. But whichever decision producers follow, whether it is to expand their ranges to grow or rationalise their offering to channel growth, knowing and better understanding your consumer will remain one of the most important and valuable tools to growing one’s wine sales in a potentially depressed marketplace.

• Greg Sherwood was born in Pretoria, South Africa, and as the son of a career diplomat, spent his first 21 years traveling the globe with his parents. With a Business Management and Marketing degree from Webster University, St. Louis, Missouri, USA, Sherwood began his working career as a commodity trader. In 2000, he decided to make more of a long-held interest in wine taking a position at Handford Wines in South Kensington, London, working his way up to the position of Senior Wine Buyer. Earlier this year, he moved across to South African specialist merchant Museum Wines to become the Fine Wine Director. He qualified as a Master of Wine in 2007.