Australian Vintage is on a roll. Last month it announced record results with profits up by 79%. Despite being less than 30-years-old, it s become a major force in the global wine market and one of only two publicly listed wine companies in Australia. The September/October issue of Drinks Trade features an interview with Cameron Ferguson, who was recently promoted to Chief Operating Officer for Australasia and North America, about why this is just the beginning of the journey. Here's an excerpt:
How does Australian Vintage plan to build on its record results?
Having such positive numbers puts us in an excellent position to increase investment back into the business and our brands. This year our three core brands – McGuigan Wines, Tempus Two and Nepenthe grew by 14 per cent globally. We are also investing more into the next wave of our ‘Bring a McGuigan’ advertising campaign, which is back this month for an extended 12-week run, reaching 3.6 million consumers across Australia. In China, our three year compound annual growth rate is impressive and, for a late entrant into the region, I’m extremely pleased with the progress we are making and the partnerships we’re building. The right strategic building blocks are now in place to give us a long-term, sustainable business with credible distribution across the market.
What challenges do you see in the Australian wine retailing market?
Consumers want new experiences, and wine is no different. People want to try new varietals and styles as well as having the established wines that put Australia on the map. As a company, we have taken some brave decisions in terms of new vineyard plantings and selecting which grapes we believe will be making waves five-to-ten years after we’ve put them in the ground. It’s a gamble, and not always easy to predict, but we’ve had some great success with Malbec and Tempranillo and to a lesser extent Montepulciano and Gruner Veltliner. European varietals are really coming to the fore, but with an Australian twist, and I find that very exciting for consumers and how wine companies like ours can really take drinkers on a journey.
Restaurant wine lists demonstrate the evolution happening in terms of consumers’ changing tastes and this trend is certain to filter down to the retail space, which will influence the wine styles and product mix on shelves in the future.
Which of your brands have you had the most success with this year?
McGuigan Black Label remains our biggest selling range, but we took the strategic decision to pull away from deep discounting to protect its long-term viability. In the end, if we don’t respect our brands, no one else will. As a result, our growth has slowed slightly in the short-term as the impact of that price realisation has come through. However, we have found our customers incredibly supportive and it has strengthened our relationships across the board, opening new opportunities as we looked for new growth opportunities.
The move has accelerated the development of our retailer exclusive sub-labels under McGuigan together with renewed focus and investment across Tempus Two and Nepenthe which are growing at 38% and 15% respectively across Australia.
What are your ambitions for Australian Vintage in the short to medium term?
We are very single-minded as a business with several key strategies under-pinning all our activity. Crucial to our ongoing success is growing exports further as well as pushing our branded sales and developing new products. We are committed to growing Tempus Two considerably further and see huge potential for it in Australia and globally. Nepenthe is growing its footprint beyond its South Australian heartland and the launch of the super-premium Apex range last month adds another layer of depth at the top end of the market.
Read Ferguson's full interview by clicking here.
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