The Hindu Business Line : Wine and winning

The mind has strange ways of delving into the past and bringing out associations. There I was, looking curiously at the name of the wine maker who had kindly supported an event I was attending. Curiously, because I had not heard the name till then (not that I am an oenologist of repute) and had just taken an appreciative sip of the deep red liquid. Also because it claimed an Italian lineage. I somehow thought every wine maker wanted to position himself as distinctly French. I was distantly aware that the cult of Bacchus had evolved in Italy and in the 1st century, wine was first exported from the Roman Empire to the rest of Europe. Yet, within 200 years, France became the dominant force in the world wine market for centuries to follow. The new world (USA) and the newer world (Australia, New Zealand, Chile, South Africa and good old India) are now emerging as names to reckon with in the wonderful world of wine.

Coming back to the wine I was savouring, Reveilo, the brand from Vintage Wine, stood for the bold new face of Indian wine makers. Here was a relatively new company charting a course in a domestic market that had three dominant players (Chateau Indage, Grover Wines and Sula) and a dozen smaller players. It had obviously positioned itself well, with its Italian lineage, and was committed to quality. Yet, I was teleported back to over 25 years ago when wine in India meant the thick, red very sweet Ruby Golconda from Hyderabad and some small producers indigenous to Goa. I recall tasting a wine called Adega Da Velha in Panjim (now Panaji) and wishing I had a regular source for wine in Mumbai.

Around 20 years ago or so, I remember regularly bumping into Kapil Grover on flights to Bangalore, and at the Windsor Manor in Bangalore. He was pioneering the wine industry in India, and one could scarcely believe that in just two decades he would have a distinguished brand like La Reserva firmly established in the market.

Globally, wine has always been a huge business. Positioning and marketing have been the all-important pegs on which the entire industry has always hung. Sure, historically, it had a great cachet. The Mesopotamians and then the Egyptians cultivated grapes and produced wine of the kind they loved to carry with them even into the after-life. When Jesus performed a miracle, he turned water into wine. The French used their first-mover advantage and quickly made sure that sparkling wine, even if produced by the methode champenoise, could not be called champagne unless the grapes came from the district of Champagne. The bubbly has gone on to become synonymous with celebration the world over, a heady salute to advertising and marketing.

Yet, even if you cannot tell your Bordeaux from your Beaujolais, you can raise a glass (Reidel if you can) to the wine revolution that has been sweeping across India. Gone are the days when you would walk into your hosts' house and he would ask the standard question "What will you drink?" and before you made up your mind, thrust a glass of Scotch and soda into your hand. Wine was only seen at Consulate parties and the inability to procure adequate quantities of it earned it the sobriquet of a "ladies' drink" in India.

All that is now history. One estimate has it that India's total wine market is around nine lakh cases. Of this, imported wine constitutes 1.5 lakh cases. In a global perspective, this is really minuscule. The wine market in the US is estimated at 250 million cases and in France, around 320 million cases. To the savvy marketer, this obviously translates into a huge opportunity.

Factor in changing tastes in India, the increasing awareness about wines, the massive younger segment that demography has gifted the country, the galloping economy and the increasing allocable surplus in the hands of ever-younger people, and you begin to see what a bonanza is waiting to be enjoyed by wine makers and importers in the country.

In money terms, one estimate claims that the wine market in India last year was Rs 200 crore. This year, it could be an estimated Rs 300 crore and is slated to hit a hiccupping Rs 1,000 crore by 2008.

Small wonder you have Seagram already in, Kyndal showing interest and Diageo looking hard at the Indian market. The king of good times, Vijay Mallya, is poised to enter the wine market as well, Karan Billimoria of Cobra has made a tentative entry with his General Billimoria brand, and there are a number of smaller players already existing, or waiting in the wings.

With the law prohibiting advertising, the marketing of wine takes on several subtle routes. Public relations, events and promotions are all big weapons in the armoury of the wine marketer. Chateau Indage was among the first to have set up wine bars that actively promoted wines and wine drinking. Wine clubs are sprouting in the major cities of India. Wine-tastings are organised by an increasing number of restaurants. In a more organised way, French wine by-the-glass is a promotion that is currently on in cities like Bangalore, Delhi and Mumbai. The idea is, of course, to get thirsty souls to sample the fare in smaller quantities at easily affordable process. The well-tested approach of inducing trial holds good in the wine industry and at this stage it is not difficult to get a wine sponsor for a high profile event.

A clear sign that wine is staking a big claim to the great Indian market is the fact that more and more magazines and even newspapers are introducing columns on wine, and we are witnessing the creation of a few "experts" who write regularly on wine. There is even a magazine dedicated to wine being published regularly. The social circuit has already embraced both sparkling and still wine. I was even invited to a `wine-tasting' party where all the guests were supposed to bring along a bottle of wine of their choice and then the contents of each wine would be `blind-tasted' to guess the dominant grape used in the particular wine.

Yet, I have a few concerns. A statistic I saw revealed that all the foreign wines are priced above Rs 500 per bottle and go up to Rs 3,000 a bottle (not to mention wines available at Rs 25,000 a bottle). All local premium wines are evidently available between Rs 150 and Rs 500 a bottle, except for three labels. Now consider the moves being made by the Minister for Agriculture to make wine available not just in "wine shops" (a misnomer for liquor shops) but even in grocery stores, and you would suddenly have a vastly increased accessibility to wine. However, while it is a sound strategy to keep the price low and get droves of first-time tasters into the fold, one must keep in mind the fact that wine has a certain `image'. And that image could fetch a handsome premium. I would be sad to see the day when Indian wines are the "Tetra Pak wines" that people guzzle outside football stadia all over Europe, and imported or phoren wines are the variety uncorked, or unscrewed in elite restaurants and homes.

Indian wine-makers would be well advised to have multiple labels at different price points to ensure a healthy bottom line. Meanwhile, let's sit back, relax and raise a toast to the good times ahead. Cheers, or as the Italians would say, cin cin!

(Ramesh Narayan is a communications consultant.)

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