A bargain in a bottle
By Rhys Haynes
March 20, 2005
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SALES of table wine under the $10 mark have boomed over the past five
years as bargain-hunters have entered the Australian market.
The most recent AC Nielsen data shows that sales of table wine under $10
grew seven per cent during that period, compared with wines over that
price which saw sales increase four per cent.

The increase in sales of wine under $10 is concentrated on 530 brands,
or about 30 per cent of the Australian wine market of $2.75 billion in
the year to April, 2004.

NSW Liquor Stores Association general manager Jayson Westbury said
consumers were using the $10 price tag as an important psychological
benchmark for what they consider a "good" bottle of wine.
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"The consumer is becoming far more savvy in terms of what a value
proposition is, and I think a lot of people do buy wine on the basis of
its price point," he said.

"I think there is anecdotal evidence to suggest that, when a wine is
under $10, the consumer's expectation of that wine is completely
different to when the wine is above $10."

But consumers should not necessarily expect less by paying less,
McGuigan Wines managing director Brian McGuigan said.

In the past five years, the market has changed dramatically in favour of
the under-$10 wine buyer, Mr McGuigan said.

"A lot of products which are $9.99 used to be as high as $14.99, but
there has been a decrease in the price of those premium products down to
that level.

"For the consumer, Australian wine offers great value at the $10 mark,
and Australian consumers can buy terrific wine at an attractive price,"
Mr McGuigan said.

Mr Westbury says consumers are slowly learning that there are plenty of
good wines under $10.

"People obviously have a palate expectation, for whatever reason, that
when something is under $10 it is more than likely to be a bit of a
quaffer," he says.

"But once a wine arrives to market and word gets out among consumers
that it's a good drop, and it has a price under $10, it will become a
screamer."

CommSec senior analyst Craig James said consumers are happy to buy
lower-priced wine, if the occasion suits.

"It is wine for purpose-buying - some people only want a wine to go with
a barbecue and there's a fair bit of competition at that lower end," he
said.

"But if you are going out to a good restaurant, you don't want it
spoiled by a bad bottle of wine. It comes down to research - people try
and buy, and once they have found something they like they stick with it."

So there's no easy answer to finding a wine you like - just do your
research and keep your ears, and mouth, open. Tastings are a good
opportunity to let the wine do the talking, Mr Westbury said.

"A lot of smart retailers provide tastings because, so often, people
perceive that if the wine is under $10 it will be average, but once they
taste it they think, 'Gee! That's like the other wine we've sometimes
bought which is $12 or $13, so we've discovered a good buy ... and I'll
have a case.'

"There are plenty of wines under $10 that I'm aware of that are very
good drinking wines, and there are plenty in that $10-$15 range that are
also very good, so the consumer needs to take a broad-brush approach,"
he said.