Of all the state-controlled retail monopolies in the Nordic countries – including Sweden, Finland and Iceland – Norway’s is probably the most restricted. Unlike Sweden and Finland, the country is not a member of the EU, which gives the government the ability to make different decisions regarding the sale of alcohol, even if the EEA agreement in 1994 reduced the existing state control. The import of alcohol, the production of wines and spirits and the wholesale of alcohol from importers to the on-trade were privatised after the 1994 agreement, effective from 1996. Vinmonopolet, the retail chain, remains state-controlled and is the only retailer that can sell to consumers. No wines, spirits or beers above 4.7% abv are found elsewhere.
Norway’s wine-drinking culture is relatively young. In the 40 years from 1963 to 2013, registered consumption changed dramatically: spirits decreased from 71% to 15%; fortified wines went from 13% to a mere 1%; and wine rose from 16% to 85%. Norwegians have a long-existing love affair with Bag-In-Box packaging, particularly in the 3-L format. In the 12 months to February 2015, red wine in B-i-B represented 59.4% of volume, while whites represented 53.9%.
Outside Vinmonopolet
Sales from Vinmonopolet’s retail outlets do not account for the total consumption of wine and spirits in Norway. Consumers take advantage of cross-border shopping, particularly from Sweden and Denmark, where prices are far lower due to lower tax regimes and EU regulations. As Norway is a non-EU country, consumers also have the possibility of tax-free shopping at airports and ferries. Cross-border and tax-free buying of wine and spirits increased significantly in the second half of 2014, after increased allowances (six bottles of wine, if no tobacco or spirits purchased) became effective from July 2014. Norwegians travel a lot, both for business and leisure, and the long border with Sweden, along with the several daily ferries to Denmark, mean a large percentage of the population has access to duty free shopping on a weekly or monthly basis.
While it’s impossible to ascertain the exact volume of wine bought outside the monopoly system, it’s assumed that more than 30% of the wine and spirit consumption of Norway comes from products sourced outside the country. This is expected to move closer to 50%. Vinmonopolet has already registered a reduction in red wine sales (-3.6%) and spirits (-7%). The Swedish monopoly, Systembolaget, benefits from this extra volume of trade; several outlets close to the border serve, in reality, only Norwegian customers.
Duty free sales are mainly controlled by Travel Retail Norway, which is owned by Gebr. Heinemann in joint venture with Validus. It sold 2bn NOK ($258m) worth of duty free in 2014 at Oslo Airport Gardermoen. The large ferry companies are Norwegian Color Line, Danish DFDS and Swedish Stena Line.
Alcohol marketing
All alcohol marketing to end consumers is illegal, which creates difficulties but also opportunities for importers, wine and spirit producers. Since no advertising is allowed in consumer magazines, on restaurant menus, or in the state-controlled monopoly outlets, the big international brands have less influence than in ‘open’ markets. No one can pay for shelf space and no incentives can be offered to retail sales staff. Nor can wine producers or importers directly approach sales staff in Vinmonopolet, and tastings can only be held at pre-approved wine fairs or other events. End consumers cannot attend sponsored events and can only join wine tastings that charge an entrance price.
Listings for products are based on tenders set by the monopoly, giving small producers and importers the same chance to have their products listed as larger players. The listing guarantees them shelf space for 12 months.
Vinmonopolet
The monopoly is the only retail outlet for alcoholic beverages over 4.7% abv. The retailer is state-controlled and has 299 outlets offering seven categories of product. The biggest category offers about 1,850 wine, spirits and beer products.
Twice a year, Vinmonopolet launches a new marketing plan, and creates tenders focusing on different areas and style of wines. Those wines available in the 58 larger outlets are called basic listings. If Vinmonopolet decides to only buy one lot – for example, just 1,200 bottles – it’s called a One Lot listing. Tenders come from these two listings and are launched six times a year. All importers, small or large, can participate in the tenders and those products chosen will be listed in all the largest outlets for 12 months.
Importers can choose to make other products available for consumers and this listing is called To Order. These products are not available on the shelf but can be pre-ordered in the shop or at the Vinmonopolet website. Around 12,000 products are available. The pre-ordered products are then picked up at a selected retail outlet or post office, or can be delivered at home for an extra fee; however, Internet sales account for less than 2% of the volume.
Before the tenders are selected for the marketing plan, a team of six analyses sales, national trends and international trends. Eirik Andersen , the market and portfolio manager, gives final approval for tenders selected. All samples for tenders are tasted blind by another department, followed by recommendation given to the buying department which further coordinates final price and volume with the importer. A ranking system based on sales volumes for the product category defines which products remain listed as basic product in stores after the tender period.
If the new product has not achieved the expected volumes during the 12-month tender period, it is de-listed. The importer can then choose to offer the product further on the To Order list. Six times a year, every product is evaluated to ensure it’s reaching the minimum set volume for its category. If it’s de-listed, it allows new products to enter through tender. Full information about the Vinmonopolet system can be found at the vinmonopolet.no website.
Currently, Vinmonopolet also has seven specialty outlets that offer small allotments of fine wines.
Leading importers and wholesalers
Vinmonopolet buys from 403 different importers and wholesalers. Only registered and approved importers/wholesalers can deliver products to the Vinmonopolet. The larger players include groups of import companies that also operate in other Nordic markets.
As a result of the 1994 EEA agreement with the EU, the importing and production divisions of Vinmonopolet were privatised effective from 1 January 1996 under the name ArcusGruppen AS. The current CEO is Otto Drakenberg.
Arcus AS produces spirit brands like Linie Aquavit and several types of vodka and grape spirits. The wine division, Vingruppen, buys bulk wine from different countries and creates local brands for the Norwegian market, particularly in the popular Bag-in-Box packaging. It includes five different wholesale/import companies: Arcus Wine Brands; Symposium Wines (co-owned with Sebastian Bredal MW); Excellars; Vinordia; and Vinuniq. The Group Director Wine is Thomas Patay, and a team of portfolio and product managers handle import and producer contacts.
Another large player that also operates in other Nordic markets is the Solera Beverage Group, under CEO Stefan H. Norberg. This group includes 12 different companies that import wine, spirits and beer. Other import systems focus more on the on-trade than others, like Moestue Grape Selections AS, started and owned by Christopher Moestue. A few niche importers exist, such as Non Dos, focusing on biodynamic and organic producers. Other larger international brand companies like LVMH have their own importing company in Norway and a few large producers like Torres have joint ventures in the market.
Since tenders are the easiest way to get new products on the shelf, a small importer can be as successful as a bigger one. A full list of importers can be found on Vinmonopolet’s website.
Leading wine publication
Aperitif, Norway’s leading wine publication, celebrated their 20-year anniversary in March 2015. Members receive 10 paper issues annually, and the weekly newsletter has more than 70,000 members. Over 400,000 Norwegians visit aperitif.no each month. Since this is a trade magazine, the magazine is allowed to print alcohol advertisements.
The editor is Aase E. Jacobsen: She writes most of the articles in the magazine and selects the wines she suggests weekly in the newsletter. Her recommendations can increase the sale of specific wines, depending on the wine’s listing at Vinmonopolet and its availability.
Ingvild Tennfjord, a fairly new wine writer, has gained press attention for her two popular wine books. She has become a wine columnist for the regional Bergens Tidende newspaper, and her columns are reprinted in four other newspapers from the same publisher. These daily regional newspapers cover most of the country, except for the northern areas.
Arne Ronold MW is the editor of Vinforum magazine, which also has a website and newsletter. However, as this is available not only by subscription but also on newsstands, the magazine cannot accept print advertisements. Ronold has also written several books on wine and wine regions, and is responsible for the WSET Level 4 courses in Oslo. Several other larger newspapers, like Dagbladet, VG Helg, Dagens Næringsliv, and Finansavisen, have weekly wine columns, as do the smaller regional newspapers. There are also various trade magazines and wine blogs on offer in Norway, such as Christer Byklum’s mywinesandmore.
Leading on-trade distributors
Selling to the on-trade is not controlled by Vinmonopolet. Wholesalers and importers can sell directly to on-trade establishments holding an alcohol license, but most have agreements in place with drink distributors. Larger hotel chains often have agreements in place with supply organisations like GRESS, which have negotiated better prices and pay-back from specific wholesalers on behalf of their on-trade members. Members are loyal and normally only source alcoholic beverages through these agreements. On-trade establishments with alcohol licenses also have the ability to import wine on their own behalf, but few take advantage of this possibility because an extra license is required and the paperwork is onerous.
Leading restaurants
Since the end of the 1990s, Norway has seen a boom in restaurants, following the new ‘Nordic cuisine’ trend, although not as actively as Denmark. There are so many new restaurants opening (and closing) that it is hard to single out particular establishments. The most famous is Maaemo, which received two Michelin stars only a year after its opening in 2012. It is a true Nordic restaurant: the head chef is a Dane, Esben Holmboe Bang; the co-owner and sommelier is a Swedish-speaking Finlander, Pontus Dahlstrøm; and the co-owner Jon-Frede Engdahl is Norwegian. The wine list is dominated by biodynamic, organic and sustainable wines, in keeping with the restaurant’s commitment to using organic ingredients. Other popular restaurants include Renaa in Stavanger, Colonialen in Bergen and Credo in Trondheim. The decision makers are often the owners as for Renaa, owned by prize-winning chef Sven Erik Renaa.
