Red wine is Systembolaget’s largest wine category in terms of sales volume.
Red wine is also the largest of all categories in terms of number of items in the range.
It's a mature category.
A clear premiumization trend has been going on for many years, but during the pandemic year 2020 has led to further accelerating premiumization.
Italy's very large market share is slowly but surely declining, although the volume is still more than 3.5 times larger than the second largest country, Spain.
The 10 largest countries
Most of what Systembolaget is looking forward for a fixed range is from the 10 largest wine countries.
For the largest wine countries, the focus is on launching news where there are clear gaps.
For example, in the absence of the most well-known regions and areas in the various countries.
Or where a country's "signature grape variety" or grape blend is missing.
For regions or styles that are already well- or over-established, price gaps may need to be addressed.
In all cases, main focus is to fill the gaps with a more sustainable alternative – a climate smarter packaging or higher demands on environmental impact and social responsibility.
Climate smarter packaging
In the shelves with red wine, dominate glass bottles as packaging. Unfortunately, too many of those glass bottles are severely overweight.
Because the range of red wine is so large, red wine is a key category to reduce the climate impact from packaging.
Systembolaget will increase demand for cardboard packaging, PET bottles and can even in the higher price segment.
The minimum requirement will be to at least have as light a glass bottle as possible, will be set consistently with fewer and fewer exceptions for fixed-range launches.
At the same time, continuing to expand the offer of smaller-format boxes.
White wine is a stable category without major surprises.
However, it continues to take shares of red wine.
Still, white wine's average price is about SEK 10 lower than for red. There are clear price limits. Wine under SEK 100 has strong demand.
In the higher price segments, the origins are of great importance.
Up to 119 there is a pretty good width both in styles, origins and grape varieties, but when you get over 120 it becomes clear that the customer is looking for safe choices and then turns to classic origins, such as Chablis, Burgundy and Sancerre.
In 120-149, Albariño has crept in as a contender.
We also see here that Grüner Veltliner from Austria, Sauvignon Blanc from New Zealand and exclusive, dry Riesling from Germany have strong customer demand. In higher price ranges, only well-known producers from Germany and the US have a demand that can match the safe origins a little bit.
We are seeing an increased interest in the small boxes.
The more expensive segment that has been around the longest has been a bit difficult for a while but is now starting to increase in demand.
For the cheap, small boxes, pretty much all the launches have had strong customer demand.
This has meant that they are taking shares from other box segments, although they have also experienced growth in 2020.
For the big boxes, we see a continued slide from the cheap box segment towards the middle segment.
The expensive segment has growth but not at the same level as the entire category and therefore not ready to further supplement with something new. In the price situation above 100/l, the customer is looking for a slightly smaller package, 1.5 or 2 liters.
Focus will be to increase in the proportion of sustainable packaging. It should be either cardboard or PET.
All glass bottles should be lightweight bottles, which cannot be a big problem to solve.
For segment 80-99, we see opportunities to increase the number of PET and cardboard packaging at the same rate as demand is increasing for these packaging.
There should also be no problem here that the glass bottles are of a lightweight model.
In terms of range, there is a good breadth, and we see an increasing interest in aromatic and spicy grape varieties, not only Sauvignon Blanc, but also other grape varieties.
The clear trend for Pinot Grigio we have seen in the UK, for example, is now beginning to show here, although the change is not dramatic.
In price ranges over 100, there are many challenges to keep a good width. It is quite clear that Sancerre, Chablis and other white, Burgundy dominate the segments over SEK 150 and have strong representation even in the cheaper ones.
Competitors are New Zealand Sauvignon Blanc, German Riesling, Grüner Veltliner from Austria and Alvarinho/Albarinho from both Spain and Portugal.
The US also has strong demand up to 150. Here there will be both additions of highly requested origin and origin/grape varieties that are missing to create breadth in the range.
Many of the launches will rely on TSVs, as they often have stronger demand as temporary products. Probably because that customer is looking for new things and doesn't want to buy the same wine.
This is especially true for wines +200.
Rosé wine is still a clear seasonal product.
Today we see a start to the season from the end of April and a clearer end of the season from the end of August.
However, we have seen an increase in sales even during the off-season.
Even before the pandemic hit, we could see a clear increase in volume in January, which then persisted with a small exception in March/April.
Otherwise, it is difficult to assess whether the strong growth is due to the pandemic and that many chose to drink rosé at home instead of in cafes and restaurants abroad.
In any case, June is still the biggest month for rosé.
Still a challenge
The category still places great demands on flexibility in the range. The buying patterns change from high season where, for example, bottles 100+ sell significantly better than in the off-season.
The opposite applies to cardboard packaging and cheap boxes that have significantly more even sales over the year.
Stable fixed range
The pace of renewal in the fixed range is slow as the need for products for the whole year is limited to certain segments.
Definitely not bottle 100+.
It is mainly in the volume segment that there is a need for products in Ordinary Assortment.
It is also quite clear that consumers who drink rosé in the off-season are not so interested in new products.
Temporary assortments important
On the other hand, the temporary ranges have a clear need for renewal. There are currently a number of products in TSV that have a steady clientele during high season and where the buy-back share is quite large.
We see here a need to ensure a renewal and thus a greater influx of new products on the market. This may mean that the repurchase limits may be increased in order to make a renewal possible.
For TSE there are a few products in limited quantity that qualify for the range.
These are products where Systembolaget cannot get the allocation they want and thus not cover the needs of the TSV.
Systembolaget will continue to launch rosé in TSE but the demands for uniqueness will be very high.
We will continue to see new products, especially from Provence, that will take their place on the shelves during high season.
Sparkling wine has had a long-standing strong sales increase.
For champagne, sales are concentrated in the larger cities in general, but Stockholm in particular.
On the other hand, sales of sparkling from other origins have achieved a much more even distribution across the country.
Although there are two clear sales peaks per year – one in June and one in December – sales have gradually become more evenly distributed over the year.
Sparkling wine is no longer a drink just for very special occasions and holidays, but for a large proportion of customers has become a natural alternative to other wine categories and beer and cider.
Sales volumes are heavily dominated by Italy, Spain and France. Unlike red and white wine, customer demand is to a very small extent driven by country of origin or grape variety.
Here, it is mainly four dominant regions, the type of sparkling and the price situation that are key factors for customers' choices.
The sale of champagne shows the clearest signs of maturity. Sales growth has slowed for several years. The range is both wide and deep with few real gaps.
However, the more interested customers expect news, which is mainly offered in the temporary ranges, TSE and TSV.
In a fixed range, Systembolaget continue with moderate renewal rates with a few launches annually.
Cava has for a couple of years been the strongest sales increase and is the main origin of sparkling wine made according to traditional method.
This is probably because many customers who have first started consuming simpler sparkling wines have "matured" in their taste preferences, and that cava is also found within a wide range of prices.
Here, too, the range is relatively comprehensive with few real gaps. FSN and TSV offer an even flow of news.
Like champagne, sales growth has slowed.
For many customers, Crémant is the clearest alternative to champagne – but mostly at a significantly lower price.
Burgundy followed by Alsace dominates, with the Loire as the third largest region.
In fixed ranges, Systembolaget will renew when gaps arise from these areas, or when price gaps arise.
Systembolaget will regularly launch Crémant in higher price positions, and to some extent from other regions, mainly in TSV and TSE.
The region with the greatest growth over the last 10 years, which has now slowed down.
The range shows no gaps, rather an over-establishment within a narrow price range.
The exception is the new Rosé Prosecco, where we will follow the development and reception from customers with any further launch in fixed range in different price modes if necessary.
All other countries, as well as sparkling from the other
Either based on quality-grade interesting offerings in lower fixed range price locations or based on specific/unique types and narrow origins that can appeal to more interested customers in TSV and TSE, less often in fixed ranges.
Climate smarter packaging
The single biggest challenge for sparkling wine is the lack of climate-smarter alternatives to heavy glass bottles.
Alternatives such as canned or PET are very welcome, but the range globally is scarce.
For the time being, the most accessible way to reduce climate impact is to reduce bottle weight as much as possible.
A large proportion of existing items in the range have unnecessary overweight.
Today, there are many possibilities to offer sparkling wine using traditional method in bottles weighing about 800 grams.or wines with the tank fermentation method, the equivalent is about 600 grams.
Systembolaget urge every distributor to review the available options for their sparkling wines and as soon as possible switch to a lighter bottle than they have today.