Supermarket wines

We investigate the sale and marketing of private label wines at Coles and Woolworths.
 
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03.Lack of labelling

Consumers have a right to know the heritage and background of products they’re being sold.
- Stephen Strachan, Winemakers Federation of Australia

While consumers may baulk at buying no-frills liquor, there’s no easy way for them to know who makes their wine, short of searching online or checking the Australian trademark database. 

Charles Sturt University’s associate professor Anthony Saliba is a program leader at the National Wine and Grape Industry Centre. He believes supermarketproduced wine ought to be labelled as such. 

“When you buy a generic product, you don’t know much about it. Has it been ethically or sustainably produced? It’s impossible to track down if you only know basic information such as the variety and a broad region.”

Stephen Strachan of the Winemakers’ Federation of Australia agrees. “Consumers have a right to know the heritage and background of products they’re being sold.” The reason for not labelling private label liquor as such is clear. 

“It wouldn’t be popular if it were called ‘Woolworths Select’ or ‘Coles Smart Buy’,” says one wine producer. 

“With wine you want it to have a premium feel, it’s not something like sugar. Wine you sit on the table and enjoy with friends. You want it to look premium and have a premium feel and packaging.”

Is it a cheaper alternative?

The lure of a cheap, decent bottle of vino might appeal, but according to IbisWorld, the consumer is unlikely to see an overall benefit economically. 

“While the supermarket giants are expected to continue engaging in price wars, this will take the form of cutting flagship products… in an effort to increase store traffic and boost sales of other products, rather than across-the-board discounting. As a result, average selling prices are expected to increase over the year, boosting revenue and margins.” 

Are the wines sold under private labels of similar quality to proprietary brands? Generally, it’s difficult to tell the difference – even wine connoisseurs may not be able to pick a generic from a branded product. Lawrie Stanford, executive director of Wine Grape Growers Australia, believes the supermarket home brand wine is of a lower quality, but is being sold at a premium. 

“At the end of the day they access wine cheaply from growers and processors. At the same time they are marketed as proprietary labels and achieve the same premium price on the shelf. So the tendency over time will be for poorerquality wine to be sold for the same price as high-quality labels, leading to an undermining of the quality proposition.” 

Interestingly, a number of our sources tell us that many of the private label wines are actually identical, but sold under different brand names, in different packaging and at different price points. 

“Many are just the same wine repackaged,” says Paul Rogers, a wine taster and holder of the Australasian Wine Masters Award from the International Wine Academy. “The only way you can tell is if you’re very astute in wine tasting, which isn’t an exact science.”

Case study

Bill (not his real name) is the owner of a boutique vineyard in Margaret River, WA. He refuses to deal with the supermarkets after being on the receiving end of some nasty tactics, and instead sells directly to independent liquor retailers. 

“Either you’re with them or you’re against them,” he says. Bill’s wine was previously stocked in the Woolworths-owned Dan Murphy’s. 

At the time, the buyer responsible for his account threatened him with drastic action if it showed up elsewhere for less. The buyer told Bill that if he saw the wine cheaper in a different liquor store, Dan Murphy’s would “go it”.

“That means they’ll put it in a $9.99 bin… If you upset them, look out – you’ll find yourself advertised in the catalogue for less than your wholesale price. Then independent stores ring up and tell you they don’t want to do business with you anymore either.” 

Bill also says the staff at supermarket-owned stores push private label products above the brands. 

“There are hundreds of them, and the customer doesn’t know. They don’t have the chance to understand that this is a private label brand and not a mum and dad vineyard that’s grown the grapes.”

 

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