As an industry, we can’t complain that the emerging generation is drinking less when we are retreating into ‘super premium’ segments. We have always told ourselves that wine consumers start with affordable, sweeter drinks and as their palates mature, move to more complex and premium wines.
How do we expect younger consumers to drink entry-level wines when the brands aren’t being invested in?
In the 1990s, Southcorp Ltd, Pernod Ricard and Hardys invested millions of dollars in above the line marketing. Advertising of sparkling wines such as Minchinbury, Great Western, Seaview and Yellowglen was prolific. Jacob’s Creek was ‘Australia’s Top Drop’. Glass Mountain was advertising on TV, and wine drinkers were wondering ‘where will you hide your Coolabah’. Today the wine category barely registers on Nielsen’s alcohol ad-spend rankings.
Australia’s top 3 alcohol advertisers in 2019 were Diageo, Beam Suntory and Campari (all spirits); the highest-ranked alcohol player was only #20 on Nielsen’s all-categories list. No wine company appears in the top alcohol advertisers.
According to the Nielsen 2024 Food & Beverage Report: metro TV ad spend in F&B fell from $269.5m (2014) to $202.3m (2023), a ~25% drop. Digital surpassed traditional formats in 2023. Alcohol digital bookings rose 69% H1 2016 vs H1 2015, driven by spirits and RTDs, not wine.
And the funnel is shrinking from the bottom. The volume share of commercial wine in Australia has fallen from about 75% a decade ago to 67% today, and IWSR forecasts it to drop to 61% by 2028, premium volume growth is expected to replace less than 20% of the lost commercial volume. Australian per-capita wine consumption is around 25% below its 2012 peak, and per-capita alcohol consumption hit a 50-year low in 2022. The Federal Government’s 2024 Independent Review of the wine industry uses the word ‘crisis’.
Have private-label brands destroyed investment in the commercial end of the market? I understand that private-label brands, controlled by Coles and Woolworths, have grown, but these brands only compete on the shelf, not in the media. They are price-driven products, not brands looking to build brand equity.
The larger wine businesses are retreating from the commercial segment. Pernod Ricard has exited the wine category, completing the sale of Jacob’s Creek, Orlando and St Hugo to Australian Wine Holdco / Vinarchy on 30 April 2025. Treasury is focusing on luxury brands. It appears that spirits brands are leading the way with above the line advertising for their brands. There is a rise of non-advertising private-label brands taking over shelf space. And the entry rung that used to belong to Yellowglen, Seaview and Lindemans is increasingly occupied by Coles’ and Woolworths’ phantom-label brands, which by design never advertise.
In the last decade, spirits and RTDs have manufactured at least three category-creating cultural moments (the Aperol Spritz, the Espresso Martini revival, and the seltzer / RTD wave) through advertising, PR and on-trade activation. Wine has produced none. The closest is Prosecco’s growth in Australian retail, but no Australian wine major is in that race; it has come almost entirely from Italian imports.
If this was the 1990s and the larger wine businesses saw the growth of the Prosecco category, there would be a Yellowglen Prosecco, Wolf Blass Prosecco, or Lindemans ‘Bin 100’ Prosecco and there would be creative and well thought out advertisements all over billboards, sponsorships and TV (and these days, targeted social media).
Whether commercial wine still makes operational sense or not, the strategic question is the same: who funds the entry rung that creates the next generation of wine drinkers? Spirits has answered that question, through cross-subsidised brand portfolios and category-building cultural moments. Wine, post-Pernod, post-Treasury’s pivot, has not.
Sources
Nielsen, 2024 Food & Beverage Report (Australia), released November 2024 — for metro TV ad spend in F&B falling from $269.5m (2014) to $202.3m (2023) and digital surpassing traditional formats in 2023. https://www.nielsen.com/news-center/2024/nielsen-releases-2024-food-and-beverage-report-covering-a-decade-of-data-on-the-sectors/
Nielsen Ad Intel, 2019 ranking of alcohol advertisers (summarised by Drinks Trade) — for Diageo, Beam Suntory and Campari as Australia’s top three alcohol advertisers and the highest-ranked alcohol player only at #20 on the all-categories list. https://www.drinkstrade.com.au/news/australias-top-3-alcohol-advertisers-in-2019/
AdNews, “The Changing Face of Alcohol Advertising”, for alcohol digital media bookings up 69% H1 2016 vs H1 2015, driven by spirits and RTDs. https://www.adnews.com.au/news/the-changing-face-of-alcohol-advertising
Wine Australia, Market Bulletin 319, “State of the Wine Market” (August 2024), citing IWSR forecasts presented at the Wine Industry Update 2024 — for the volume share of commercial wine in Australia falling from ~75% a decade ago to ~67% today and forecast to drop to 61% by 2028. https://www.wineaustralia.com/news/market-bulletin/issue-319