Wine Trends in Italy: Declining Consumption and Digital Challenges
1. Decline in Wine Consumption in Europe
Wine consumption in the European Union continues to decline, a trend that has been underway for some years. This decline is attributed to increased health awareness, alcohol consumption preferences among young people and competition from other beverages. Red wines in particular have been hit hard by this trend.
2. Forecast of Further Decline in Consumption
According to the European Commission's Outlook, wine consumption is expected to decline by around 1% per year until 2035, leading to an average of around 20 liters of wine per capita, a decrease of 2.4 liters compared to the period 2018-2022. However, this forecast assumes that the decline in demand for some types of wine will be offset by growth in demand for white, rosé, sparkling and alcohol-free wines, along with the industry adapting to new demand patterns.
3. Impact on EU Wine Production
Reducing wine consumption in Europe is affecting EU wine production. Production is expected to decline by 0.6% per year, reaching 145 million hectoliters by 2035. This has led to an increasing dependence on exports.
4. Italian wine exports in decline
Italian wine exports recorded a decline of -1.9% in the first nine months of 2023 compared to 2022. This decline was influenced by several factors, including increasing competition in international markets, especially in the sector of low- and medium price. Some traditional EU export markets have reached saturation levels.
5. Digital Growth of the Sector
In parallel with the challenges of consumption and exports, the Italian wine sector is investing more and more in digitalisation. Wineries are improving their online presence and using social media, particularly Instagram and LinkedIn, to reach consumers. Additionally, the growth of e-commerce channels is becoming increasingly relevant for direct-to-consumer sales.
6. Languages for Export: English and German in First Place
Regarding exports, English and German are the predominant languages used in corporate communications. This demonstrates the importance of these markets for the Italian wine industry.
In summary, the wine sector in Italy is facing significant challenges related to declining consumption and decreasing exports, but is also leveraging digital opportunities to reach new consumers and markets. Adaptability and innovation will be crucial to the future of this sector.
The Wine Net: Cooperating for the Present and Future
The Wine Net, a cooperative alliance of Italian wineries, recently held a press conference moderated by Fabio Piccoli on December 1st, where they shared their values and goals in a period marked by discontinuity and complexity. This alliance represents cooperatives from Italian regions renowned for their exceptional wine production, such as Pertinace and Cantina Colli del Soligo in the north, Cantina del Morellino di Scansano and Cantina Frentana in central Italy, and La Guardiense and CVA Canicattì in the south.
Giovanni Greco, President of The Wine Net and CVA Canicattì, emphasized that the network now spans six wine regions, with over 5,200 hectares of vineyards and 22 million bottles sold. Their mission is to highlight the best of Italian terroirs and the people who work them, fostering not only initiatives and investments but also a sense of community and shared values.
Luca Castagnetti, who has been involved with The Wine Net for about seven years, highlighted its distinctive approach as a genuinely shared growth strategy, not a temporary aggregation formed only for exhibitions. Trust has been the cornerstone of their success, cultivated from the very beginning, leading them in 2021 to acquire legal status, enabling joint management of both promotion and product commercialization.
As we reflect on a year marked by climate change, Sergio Bucci, Director of Cantina del Morellino di Scansano, noted that adapting to discontinuity has become the norm. Coops like his, with 700 hectares of vineyards, have seen families actively cooperate during crises, minimizing quantity losses and maintaining product quality. They employ techniques like ground cover crops to preserve soil freshness and increase foliage coverage for protection against excessive heat.
Representing Abruzzo, one of Italy's regions heavily impacted by adverse climate conditions, Felice Di Biase, Director of Cantina Frentana, stressed the importance of mutual support in a rapidly changing market. When faced with a 70% drop in production, even with technological advancements, the need for cooperation becomes evident. In such times, nobody can stand alone, and resilience is key.
Domizio Pigna, President of La Guardiense, mentioned a 50% reduction in quantities produced, but through the network's collective efforts, both domestically and abroad, they have maintained a strong position in the market. Their international performance is particularly notable, with growth in the number of importers and access to new markets. In Italy, their local commercial network has helped counteract consumption contractions.
From the Barbaresco region, Cesare Barbero, Director of Pertinace, described the past two years marked by drought and significant hailstorms in 2023, resulting in a 30% yield reduction. The economic impact is felt by all members, prompting direct interventions like hiring an agronomist and implementing weather stations and frequent vineyard monitoring. They also pursue environmentally-friendly cultivation and certifications to protect the territory.
The past year witnessed significant increases in raw material costs. Cantina del Morellino di Scansano faced notable cost hikes, particularly in glass prices. Rather than passing on the cost increases to consumers, they chose to absorb them to maintain competitive prices. Similar challenges were seen at Cantina Frentana, especially in electricity costs, and they emphasize the importance of cost control in the current market dynamics.
The alcohol industry is facing increasing scrutiny, with the World Health Organization advocating for reduced differentiation between abuse and moderate consumption. Andrea Curtolo, Director of Cantina Colli del Soligo, emphasized the need for the industry to voice its support for moderate drinking. Recent debates have highlighted that the concept of "no safe level" proposed by the WHO is being questioned in scientific circles.
Looking at The Wine Net's development over the years, it has been a platform for open and honest discussions, facilitating interactions even beyond their regional scope. This collaborative approach has helped them navigate challenges successfully. Looking ahead, the network aims to identify new markets, both within and beyond wine-savvy countries, satisfying curiosity and fostering knowledge about Italian wines.
In conclusion, The Wine Net has become an appealing cooperative alliance in the wine industry, considering potential new members to further enrich its representation of Italian terroirs.
Focus: 2023 Analysis of the Digital Evolution in the Wine Sector
Social Media Channels
The Wine industry has seen significant growth in its social media presence in 2023. LinkedIn is now used by 20 out of 25 wineries (up from 13 in 2022), with a combined follower increase of over 260% compared to 2022. Instagram has continued to grow, with a 28% follower increase compared to 2022 (up from 20% in 2022 compared to 2021). Facebook, however, experienced an 8% decrease in followers. YouTube is used by 19 wineries, while X is used by 10. Wikipedia is a useful platform for 9 wineries, while TikTok is utilized by only 5.
Wine companies have shifted their social media strategies from solely product-focused content to a more holistic approach, encompassing the broader aspects of wine culture, including territory, employees, and sustainability. Content updates are increasingly structured and planned through editorial calendars.
After a surge in the number of wineries with their own e-commerce platforms in 2022, there was a pause in growth in 2023, with 13 out of 25 wineries maintaining their online shops. While user experiences have not significantly evolved, there's a clear trend among major players in the industry to guide consumers through all phases of brand-person relationships. In 2014, only 2 out of 25 wineries had their own e-commerce platforms.
With pandemic-related easing restrictions, wineries are now focusing more on in-person experiences, reaching wider and more diverse audiences. In this context, 60% of the analyzed wineries (15 out of 25) offer various types of in-person experiences, with 56% returning to prioritize on-site experiences. These include educational initiatives for students, sensory workshops, health-focused charity events, and even music tours. This shift also changes the tone of communication on social media, moving beyond product sales to encompass information and education about the region, values, and wine-related professions.
Content: Tastings, Indigenous Grape Varieties, and ESG
In 2023, 14 out of 25 wineries favor in-person activities, with 68% mentioning indigenous grape varieties on their websites, up from 14 in 2022. The level of detail in this regard varies, from mere mentions to dedicated sections and extensive descriptions. Wineries continue their efforts in environmental sustainability (Environmental), with 24 out of 25 wineries mentioning projects related to vine protection, fertilizer control, recycling, renewable energy, and collaboration with local and international entities.
There's also an increased focus on social impact (Social), with 19 out of 25 wineries mentioning their involvement in cultural support, educational initiatives, charity, and social inclusion. Governance practices (Governance) are highlighted by 18 wineries, emphasizing organizational models focused on innovation, territorial spirit, ethics, and employee treatment.
Languages and Chat
Apart from Italian, English, German, and Chinese are the most common languages on winery websites. In 2023