The coronavirus pandemic has plunged the champagne industry into crisis – will it survive?
It’s seen as the preserve of weddings, parties, holidays, and expensive, oyster-laden dinners out. It's sprayed liberally by racing drivers on podiums and crates are lugged back to Blighty in car boots through the Channel Tunnel. It's no surprise, then, that champagne sales have taken a considerable hit due to the pandemic. None of these things were possible for a large chunk of 2020.
Despite this year’s ideal weather in the chalky fields of the eastern French region – lots of sun, just the right amount of rain – 2020 may prove to be far from a vintage year. According to reports from France, consumption of the bubbly drink has plummeted since the virus emerged. Reportedly, sales dropped by $2bn (£1.53bn), a decline of a third, and a greater fall than during the Great Depression and both world wars; 100 million bottles may go unsold this year.
Such is the concern that the region’s producers, which number around 16,000, have called a special crisis meeting for August 18, when they will discuss what to do with the excess grapes. The berries could be destroyed, or turned into hand sanitiser, to the horror of many – one producer, Anselme Selosse of Jacques Selosse Champagnes, called the potential hand sanitiser directive “an insult to nature”.
Yet it reflects the stark reality that, for much of 2020, people haven't been buying champagne. In France, where over half the world’s champagne is bought, sales fell by 70 per cent during the strict two-month lockdown. In the UK, Majestic reports an 11 per cent like-for-like decline. “This we largely put down to the lack of events and weddings taking place,” says Majestic’s head of PR and marketing, Jack Merrylees.
“We are experiencing a crisis that we evaluate to be even worse than the Great Depression,” Thibaut Le Mailloux, of the Champagne Committee, which represents the region’s growers, has said. It's nothing new, as champagne regularly takes a hit during an economic crisis, as people try not to appear out of touch. (Interestingly, reports from Italy suggest prosecco sales were stable, though in Spain there was a drop for cava.)
Sales of other sparkling wines at Majestic were stable, prompting the question: is champagne uniquely ill-suited to a pandemic? A big part of Majestic’s champagne business goes on events, weddings, shop openings, drinks receptions and gallery viewings. These have been all but wiped out since March.
The preconceived image of champagne is both its biggest selling point and a potential hindrance. This is something producers are acutely aware of, and grappling with, as the uncertainty continues. Paul-Francois Vranken, who founded Vranken-Pommery Monopole, has said: “Even if the bars and the nightclubs are closed for five years, we don’t plan on missing out on customers… There will be a very big change to our marketing that highlights the grandeur of our wines.”
This could focus on the region’s rich history, or its use of organic agriculture, reflecting that customers increasingly want an appealing story and have environmental concerns. It’s something Majestic have noticed, recently listing its first organic and biodynamic champagnes.
There is a theory that Covid has exacerbated long-term trends, such as customers experimenting with new regional sparkling wines, such as French crémant, Italian lambrusco and New World wines. English options, of course, are growing, with a Sainsbury’s report released this month stating that sales have doubled in the past decade, thanks to a rising interest in ‘drinking local’.
“Covid has indeed accelerated trends that were already creeping in,” says Richard Ellison, founder of Wanderlust Wine, which has seen champagne sales decline by a quarter since the beginning of lockdown. “One of them is a greater interest in new styles from new regions.” This is especially true of younger tech savvy and social media using demographics, which “allow for an exploration of ‘the next cool thing’ and also – very importantly – constant price comparison.”
Ellison says champagne must shed its perception as a celebratory drink, especially as people are often wary of splashing out on it during recessions – which Britain has entered. “It urgently needs to change its image from a luxury, festive pour to a wine in its own right, with a place at the table, alongside food, throughout a whole meal.”
Merrylees agrees, and thinks champagne is an “underrated gastronomic wine” that, since it is often consumed standing at drinks receptions, is overlooked as a drink with brilliant food-pairing potential. Many retailers, such as Majestic and Lay & Wheeler, have found that, though units of champagne sold may be down in places, averaged spend per bottle is in fact up. Catherine Petrie MW, a buyer at Lay & Wheeler, adds that champagne is too reliant on the restaurant industry.
What happens come Christmas is also a concern. Despite the recession, people will want to celebrate. With a backlog of champagne to sell, supermarkets may initiate a price war, selling it off at hugely discounted prices. One expert told the Telegraph this could be damaging in the long term: “once something loses the perception of prestige, it’s very hard to regain it.”
Yet champagne has survived multiple crises in its history. As recently as 2008, the financial crisis sent sales tumbling, yet they eventually recovered. “Champagne has always bounced back strong,” says Merrylees, who says sales are already picking up. “We’re sure it will again.”
