Is the Prosecco Boom Sustainable?

Is the Prosecco boom sustainable? Or is it a bubble that’s eventually going to pop? That’s roughly the question that an Italian journalist asked me a few weeks ago and it is easy to appreciate the concern behind it. The market for Prosecco has blossomed, especially in the U.K., U.S., and Germany, the three largest export markets, and Prosecco producers are both excited and anxious about their future prospects.

U.S. Sparkling Wine Imports January-June 2018

usimports

A quick glance at data for U.S. sparkling wine imports January-June 2018 as reported by Wine-By-Numbers (see above) shows strong growth. Italian sparking wine (mainly Prosecco) imports grew 16% by volume and 28.3% by value in the first six months of the year despite rising average dollar import price. Only the Rosé import category is growing faster than Prosecco.

Beyond Bubbles for Birthdays

I am a wine-glass half-full kind of person, so my answer to the journalist’s query was optimistic. The question isn’t so much why U.S. and U.K. consumers are drinking more sparkling wine (and especially Prosecco) now — it is why they didn’t embrace bubbles more ardently in the past? Sparkling wine has always been an attractive option, but for some reason it became associated with special occasions. Bubbles aren’t just for birthdays and New Year any more.

But booms often contain the seeds of their own demise — either in the form of bust, fizzle, plateau, or something else. Prosecco may be no different. Having just returned from a quick visit to Prosecco-ville to speak at an award ceremony in Conegliano (see next week’s column), I can report that there is concern about this possibility within the industry.

Most of the Prosecco on the market is DOC Prosecco produced by makers that range from the very large such as La Marca, which is distributed by Gallo, to the relatively small. There are economies of scale in Prosecco-making, so bigger can be better from a profit standpoint. La Marca, for example is a second level cooperative — a cooperative of cooperatives — and its many members keep its pressurized tanks, used for the secondary fermentation, efficiently supplied with a river of base wine.

Pretty in Pink?

When quantity is the driving force, the focus can easily become one of chasing the market to increase sales, raise production, increase scale economies, and lower cost. Thus there is an incentive to look for incremental sales wherever they can be found.

This might be part of the movement to certify DOC Prosecco Rosé.  Bubbles are hot. Pink  wine is hotter. Pink bubbles should set the market on fire. The Glera grape that is used to make Prosecco is white, not red, but production rules allow the use of up to 15% of other approved grape varieties. If  those grapes are Pinot Noir, which is grown in this region,  the result is a pink sparkling wine. Pink Prosecco isn’t a thing yet, since the rules don’t allow this designation, but it might be permitted very soon.

Pink Prosecco — who could object? Well, many people, actually. The concern is that Prosecco’s identity is not well established — many consumers think Prosecco is the grape name and others are not certain exactly sure where it comes from. Prosecco’s success may come in part from the fact that consumers don’t fret about these things and simply enjoy the experience.

No One Laughed

tap

But some producers worry that by broadening the Prosecco category with a pink wine, winemakers will further dilute the brand identity to the point where it is just a generic sparkling wine, one of the ingredients in Aperol spritz, unable to command a price premium. The slope that runs down the commodity wine hill can be slippery.

At one point during our visit I joked that, since blue wines are getting some attention these days, maybe some Prosecco producers would move in that direction. Pink, Blue, White — all colors of Prosecco for all occasions. No one laughed. I guess blue Prosecco is nothing to joke about. It’s part of that slippery slope.

The concern that Prosecco’s brand may be undermined seemed particular strong in the Prosecco Superiore DOCG zone between Conegliano and Valdobbiadene. Supply is more limited in the DOCG zone and costs are higher because, unlike the valley vineyards where much DOC Prosecco is grown,  the hillside terraces aren’t all suitable for mechanical harvesting or as easy to maintain generally.

What a Mouthful!

Prosecco Superiore is therefore about value more than volume and maintaining product differentiation — of Prosecco versus generic sparkling wine and of DOCG Prosecco versus DOC production — is very important.  Wine marketing guru Paul Wagner, who led our small press tour, never got tired of pointing out what a challenge the DOCG producers set by branding themselves as Prosecco Superiore Conegliano Valdobbiadene DOCG . What a mouthful!

Prosecco Superiore suggests a premium product and is probably the right brand to try to build, although Americans have little experience with the Superiore designation for wines generally. The Conegliano-Valdobbiadene reference is meant to indicate that these are wines of origin — grown in a particular place, but most consumers don’t know what that place is or exactly how to pronounce the place names either.

Glass by Glass by Glass

I have done Prosecco tastings for non-profit groups and I note that consumers are often surprised when they taste the DOCG product, especially DOCG Brut. They like Prosecco a lot, but think of it generically as defined by DOC Extra Dry wines. They are surprised when they can taste a difference. (I’ve had the same reaction in tastings of Argentina Malbecs from different production zones).

Based on my very limited personal experience, it seems to me the key to differentiating Prosecco from other sparkling wines and DOCG Prosecco from the DOC wines is going to involve a lot of hard work. Consumers won’t understand the differences if you just tell them. You can’t tell people how something tastes. You have to show them, and let them experience it for themselves one glass at a time.

Is the Prosecco boom sustainable? Yes, I think it is, but it will take work to shore up its foundation and simply chasing market share, as tempting as that it, may not be the best long-term strategy.

3 responses

  1. Timely article (for me anyways!) 🙂 I’m studying for the Sparkling Wine Unit of the WSET Diploma and reading up on Prosecco today. Even for someone in the middle of studying this region, I find the name Conegliano-Valdobbiadene DOCG intimidating. And I always have to triple check that I’ve spelled it correctly! I think your average consumer doesn’t know what in the world this verbiage means, and as a result they are very likely to make a “safer” (read: easier to pronounce!) choice and opt for the big Prosecco brands like La Marca.

    I completely agree with your line of thinking here: “You can’t tell people how something tastes. You have to show them, and let them experience it for themselves one glass at a time.” But as for how to execute this for the DOCG . . . I’m not sure of an answer.

  2. Great article! I really wonder how Prosecco consorzio will decide about Pink Prosecco. It will be a big change for the market and for the producers. For sure it would be wiser if they drop the “Conegliano Valdobbiadene” from their designation and stick to simpler “Prosecco Superiore”. Check my article about Prosecco Cartizze sub-region at https://vinovino.si/2018/11/03/prosecco-cartizze/ (I was surprised to see how well Google Translate worked)

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: