Gallo bullish about 2013
Gallo is launching a low-alcohol white wine, a pink Moscato and an ultra-pre- mium red blend into the UK off-trade in a bid to increase its share of a volume declining wine market.
Nielsen figures show the Californian firm’s flagship brand, Gallo Family Vineyards, has experienced a 4.4% volume decline in the off-trade (52 weeks to 29 Dec 2012).
But managing director Bill Roberts told OLN he was bullish about its off-trade prospects in 2013.
He said: “Much of our success in the UK is driven by Gallo Family Vineyards Summer Red.
“So we are very excited about the launch of Gallo Family Vineyards Summer White.”
The 5.5% abv wine will be rolled out across the UK in Tesco, Sainsbury’s, Morrisons and Asda – and will also be available from impulse and convenience stores – with an rrp of £6.99.
Roberts said: “To support the launch we are investing £1 million in a social media and press campaign and TV sponsorship.”
He added that in the US Gallo brands are up 8% year-on-year in a market that is in growth.
He said: “In the UK it is not surprising that volumes are declining. The biggest barrier is the duty escalator that keeps going up and driving the price up. That poses problems. But I am an eternal optimist and I think the UK market will recover.
“A lot of growth in the US is coming in the red blend category and the Moscato category.
“Moscato is now the third largest-selling white variety in the US, behind Chardonnay and Pinot Grigio, so it is bigger than Sauvignon Blanc now.”
To replicate its US success, Gallo is launching a pink Moscato under its Barefoot brand. It will be rolled out this month in Morrisons, followed by Tesco in April and Sainsbury’s and Asda in May, with an rrp of £6.99.
Roberts said: “We want to make Barefoot the biggest-selling brand in the world. Last year it was up 55% in the UK.” The brand has increased UK awareness by sponsoring Pride events, cleaning UK beaches and supporting UK charities.
It is also bringing a red blend called Apothic Red, with an rrp of £9.99, to the UK. It is made up of Zinfandel, Merlot, Syrah and Cabernet Sauvignon.
Apothic has been sold in the US and Canada since 2008 and Roberts claimed it is now the largest-selling SKU in Canada’s entire wine market. Gallo also hopes to build on its Gallo Film Club initiative. Last year 21,000 consumers signed up to receive DVDs with wine purchases, and the firm hopes to attract another 25,000 drinkers through neck collars in 2013.