Devil's Advocate - Wine Producers and Supermarkets: an Unbalanced Relationship

When wine producers rely on big supermarkets to sell their wine, do they pause to consider whether those retailers share their business aspirations?

Reading time: 4m 15s

Robert Joseph - the Devil's Advocate
Robert Joseph - the Devil's Advocate

‘I thought that you’d want what I want.

Sorry, my dear’

Stephen Sondheim wrote some really great lyrics but this one – from ‘Send in the Clowns’ – has universal resonance for almost anyone who has been in any kind of relationship.

What has always struck me is not the misunderstandings, but the failure to acknowledge them. I often see versions of this kind of gap in the wine industry. There’s the presumption by those who have fallen in love with wine and are fascinated by it that all of their fellow human beings have a latent interest in and passion for the subject that simply needs to be ignited.

There’s the presumption by those who have fallen in love with wine and are fascinated by it that all of their fellow human beings have a latent interest in and passion for the subject that simply needs to be ignited.

They struggle with the notion that for many, including close friends of mine, fermented grape juice is, and will always be, simply a pleasant alcoholic beverage. This is similar to the quasi-religious belief by many of these same people that wine — all wine — has to reflect the spot on the planet where the grapes were grown. Again, this is something that is true for them, but not necessarily for others who would be as happy to accept wine blended from different places as they are to buy ‘Italian-style’ coffee and English Breakfast Tea.

Serious misunderstandings

These misunderstandings may be relevant to the way wine producers communicate, but there’s another gulf that has deeper implications for many in the industry: the one between the way they see wine and the way it is perceived by the big retailers who have to sell it to the end user, the consumer.

It is not unlike the gap between a parent’s aspirations for their child and the role that same human will fill for the company that employs them or the army for which they may find themselves fighting.

Retailers have different priorities

That highly-qualified buyer from the big supermarket who is considering buying a few pallets or containers of your wine may share your interest in the particularities of the growing conditions that shaped its flavour and the number of bottles you were able to produce.

The buyer’s colleague, the negotiator, on the other hand — the one busily tapping away at a calculator  — is focused on different imperatives. All that matters to them is the profit your wine will or will not generate for their company. Which is why they may well suggest shipping the wine in bulk and/or switching to a lighter bottle. These moves will be justified on environmental grounds, of course, but everyone will be aware of the costs they will save. When it suits them, the retailer may happily allow the use of heavier-than-necessary packaging if that’s what customers are shown to appreciate.


Most wineries make every mistake when they sell their wine. With a new generation of consumers now quickly moving on to spirits and cocktails, the world of wine better solve the problem soon, or it will be left far behind. Paul Wagner wrote a book about it.

Reading time: 4m 50s

Building footfall

Supermarket employees higher up the food chain may be looking at issues that go beyond the profitability of your wine, however. Their job is to encourage as many as possible of the right kinds of shoppers to come into their stores and fill baskets and trolleys with a range of stuff that is collectively profitable. For them, what matters is ‘building footfall’; a proven way to do this is to offer attractive discounts on daily luxuries like wine.

In an era when we are increasingly promiscuous in our shopping habits, it may only take a newspaper critic’s recommendation for a bargain bottle of Chianti or Chilean Cabernet Sauvignon to prompt a shopper to go to store X rather than store Y. And while they’re there, they’ll hopefully pick up a few other items whose margins will more than make up for the scant pennies the retailer is making on the wine.

To be fair to the supermarkets, some at least have tried to help the broader wine sector. In the UK, in the late 1980s, Sainsbury, M&S and Tesco all published attractively produced and priced wine books they hoped would help to 'educate the consumer'. Oz Clarke wrote the - excellent - Sainsbury's Book of Wine and, to declare an interest, I was the author of the Tesco Essential Guide to Wine. Sadly, too few of their customers shared the chains' enthusiasm for wine education for the project to survive.To be blunt, the shoppers preferred to spend their money on a discounted bottle than a book.

Winners and losers

The tried-and-tested discounting model works well for the shopper who’s getting a bottle they’ll enjoy for a price they're happy to pay, and for the shop that’s making a profit for its shareholders. But it is less good news for the wine producer and the perceived value of their wine. Ask most people the ‘right’ price for many of the wines they carry home from the supermarket, or order online, and there’s a high chance they’ll recall the amount they paid rather than the one from which it was reduced.

This is not to say that smaller retailers are all on the side of the winery, or that producers should avoid selling to the big retailers that rely on this kind of promotion, though some have indeed made that choice. In most countries where supermarkets are legally permitted to sell wine, they have at least a 70-80% share of the market and may be the only route to market through which large wineries are able to sell their wine. But producers of any size whose wines are on supermarket shelves need to understand the nature of the relationship. The chains that buy and sell their wine rarely share their desire to build and strengthen the value target consumers place on it.

The chains that buy and sell their wine rarely share their desire to build and strengthen the value target consumers place on it. 

This task is down to the brand owner, and them alone.

The only problem is that brand building requires an effective marketing budget — which is not, given low industry margins, a piece of ammunition most non-sparkling wine producers tend to have at their disposal.

Worse still, the supermarkets will want to use any spare cash producers may have, to finance the discounting that makes effective brand building and value perception so much more necessary in the first place. It’s a classic vicious circle. 

Breaking it isn’t easy but, when it comes to wine, you just have to face the facts: these retailers may be very good at getting bottles into people's homes and onto their dinner tables, but they aren't in the wine business. So, I’m sorry my dears, they really have no reason to want what you want.


As distributors get bigger, they require brands with bigger volumes to service their markets. This will reduce opportunities for small-to-medium-sized wine producers. Liza B. Zimmerman reports.

Reading time: 4m





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