Concha y Toro targets double-digit growth
Concha y Toro UK has upped its marketing budget by 20% in a bid to drive double-digit growth in each of the next five years.
The subsidiary was set up in 2001 since when the Chilean wine producer’s UK sales have grown from 250,000 cases to 5.5 million. It has 60 staff.
But to ensure continued growth it conducted a review of its operations and decided to ramp up its advertising, conduct more targeted marketing and put in place a customer marketing team.
General manager Simon Doyle told OLN: “We have the right portfolio and the capability to achieve that. But we needed to make changes to the operation, to do few things a lot better.”
Around 80% of its business comes from the off-trade and Doyle said retailers will benefit from the overhaul of the operation by receiving more tailored and targeted help, in the form of POS and targeted advertising.
“We are being stricter and more disciplined with a tighter portfolio,” said Doyle.
Marketing includes sponsoring the Tour de France with Cono Sur’s Bicicleta range and an autumn TV campaign for Casillero del Diablo.
“We will be investing a lot in merchandising and making sure brands are at eye-level and are better displayed, so retailers and wholesalers will benefit from that,” added Doyle. “There will be more POS support and a more tailored service.”
The UK arm of Concha y Toro accounts for 20% of its global business and Doyle said the investment represents a vote of confidence for the UK wine trade.
Doyle said: “A number of people look at the UK as high volume, low price. But there are signs that consumers are prepared to pay for the brands that deliver. Every price bracket above £6 is showing growth. We have lost volume but at the sub-£4 level where we couldn’t sustain it.
“We have had a great 13 years and we really believe in this market. It’s a great statement of confidence in the UK market.
A lot of large producers have been hesitant but we are definitely saying it’s there to be developed.”
He added: “Underpinning the strategy is a recognition that we really want to push premium Chile via brands like Marques de Casa Concha. This is the opportunity for Chile to start making its mark. It has over- delivered in quality and price and there’s so much potential.
“Chile has better value for money than Old World countries at a premium price point – Marques de Casa Concha comes out on top in blind tastings against Burgundy. It’s our job to explain that. That’s where independents are invaluable.”
At the opposite end of the market it will push its Fontera range in the price point below Casillero del Diablo.