Jo Gilbert looks at how Champagne is balancing prestige with price in a pressured market

Champagne has long been the ultimate symbol of celebration – a luxury product that commands premium pricing power across the globe. But as UK consumers navigate tighter budgets and cost pressures continue to mount for producers, the category finds itself at a crossroads: how to maintain its prestige and profitability without alienating the very customers who keep its bubbles in demand.

Offering a sobering opening perspective, Phil Innes, MD at Loki Wine, says: “The Champagne market is definitely under pressure. Customers are still buying sparkling wine, but baulk at the price. We are also seeing a resurgence of Cava (and Corpinnat) and English sparkling now looking like good value for money against most of the major Champagne brands.”

Latest figures from the Comité Champagne show that shipments to the UK fell to 22.3 million bottles in 2024, a decline of 12.7% on 2023, with turnover dropping to €518.7 million (-5.7%).

Adding to the picture of a category in decline, Jean-Benoît Hery, export manager at Famille Moutard, points out that non-vintage Brut remains dominant – accounting for more than 80% of UK shipments. However, volumes of NV Brut have been in gradual decline for 15 years by an average of 3.7% annually.

Globally, he adds: “We’ve seen markets diversify towards more premium cuvées, including vintage, brut nature and single vineyard styles. This trend is emerging in the UK, albeit gradually.”

Retailers report that, while sparkling wine sales overall remain buoyant, growth is being driven by alternatives. “Most categories of sparkling are increasing, whereas Champagne is decreasing,” says Innes.

“The main factor is down to price point and people having a set idea of the price they want to pay when they come into the shops.”

Rising costs, margins squeezed

Speaking of the economics of production, Adam Guy, MD of Laurent-Perrier UK, says: “Champagne is notoriously expensive to create – Laurent-Perrier’s Champagnes spend between four years and over 25 years in our cellars before release. They have become more costly to create in recent years as there has been significant inflation in grape prices, dry goods, logistics costs and new EPR costs.”

Meanwhile, grape prices have risen sharply by 5% in 2022 and 10% in both 2023 and 2024 (Comité Champagne), marking them out as the single largest cost driver. Glass, labels, cardboard and energy prices have followed suit, squeezing margins.

“Some of the decline in sales of Champagne in the UK will be related to customers cutting back due to cost of living pressures,” Guy admits. “However, demand for Champagne is still there, and Laurent-Perrier’s trade customers remain committed to serving that demand.”

At Famille Moutard, Hery says the business has opted for minimal price increases to protect relationships. However, he admits that, across the region, “higher prices have impacted sales and producers are currently carrying higher levels of inventory”.

Protecting prestige

For many producers and retailers, protecting Champagne’s image means resisting the temptation to discount. This is the case at Master of Malt, where buyer Michael Monte instead advocates for suppliers “to review pricing in order to adapt to the market”.

He continues: “I would say we are experiencing a ‘market correction’ for Champagne, but also across the drinks industry. Yet, we should always aim to offer the fair and actual price rather than heavily discounted offers.

Champagne’s Appellation d’Origine Contrôlée status and strict production rules give the category powerful tools to manage supply. For the 2025 harvest, the Comité Champagne set yields at 9,000kg per hectare – among the lowest since 2020 – to balance supply with softer global demand and maintain pricing power.

“This controlled production avoids oversupply and maintains value,” says Hery.

But retailers are doing their part too. Innes remains committed to selling premium Champagne by the glass and giving Champagne a prominent position on shelf.

Innovation & storytelling

If price is a sticking point, storytelling and innovation are the levers by which producers, suppliers and retailers are maintaining consumer engagement. Laurent-Perrier for example has focused on its three pillars of “savoir-faire” to achieve an innovative and diversified portfolio.

First, there is the focus on assemblage of reserve wines via the brand’s prestige cuvée Grand Siècle and its Héritage Champagne released last year. Second, mastery of maceration for rosé Champagne. Finally, there is the zero-dosage style via Laurent-Perrier’s Ultra Brut and Blanc de Blancs Brut Nature.

Famille Moutard has taken a similar approach, using rare varieties and limited editions to differentiate. “Our Cuvée des Six Cépages, a unique Champagne created from a blend of six of the permissible grapes, is also produced as a limited edition in a gold bottle. Our Vieilles Vignes Arbane remains the only 100% Arbane old vine Champagne in the world,” says Hery.

Cautious confidence

Despite near-term headwinds, Champagne remains a powerful symbol of luxury and still dominated by two customer groups: high-net-worth individuals and consumers buying for special occasions, which drives consumer buy-in at the top end.

“I don’t think that is going to change in the future,” says Innes.

Guy is similarly (cautiously) optimistic going forwards, sharing that in the year to date, Laurent-Perrier UK is trading ahead of last year. That is encouraging, although he acknowledges that “it is difficult to predict how the year will turn out for the category in the UK with a lot of economic and geopolitical uncertainty”.

Monte adds a note of realism to the outlook, pointing to “modest signs of recovery” but adding: “However, I do not think we will ever go back to Covid lockdown sales figures. Key decisions on harvest yields and stock management will be critical for the future of the category.”

For Champagne’s stakeholders, the road ahead is punctured by challenges. Sustainability is key to this future trajectory, both on the economic side and the environmental. On the latter, it seems that it is not yet a major purchase driver for UK consumers, despite it being a key priority within the industry.

If Champagne is to continue to command prestige – and as it jostles for position from traditional method upstarts such as Cava, English sparkling and Cap Classique – it will have to face those headwinds head-on, from rising production costs to inflation and cautious UK consumers.

However, producers are working to protect Champagne’s premium positioning by avoiding discounting, managing yields and investing in innovation, while retailers lean on education and storytelling to communicate value.

Now the category must balance price, provenance and relevance to engage younger, more sustainability-minded drinkers in order to take its legacy forwards.