Mini adventure

In the second part of our series taking the mystery out of selling wine, Adam Withrington looks at why ignoring this category could cost you sales - and how you can make the most of it. This week, the advantages of selling single-serve bottles.

If you asked the average man on the street the main difference between Irish and English pubs the chances are the word "smoking" would be mentioned (although not for much longer). However, something that he or she would be unlikely to say is that the Irish have fully embraced the concept of single-serve wines. And yet it is an undeniable fact. More wine is now sold in single-serve bottles in Irish pubs than in your average 75cl bottle.

However, the UK market has yet to see this as an opportunity. "At the moment there are better markets for single-serves out there than the UK," says Andrew Chapman, European sales director of Californian wine producer Sutter Home. "Northern Ireland is very good - single serves are actually sold in shops as well as in the on-trade. And 25 per cent of our sales in Ireland are through single-serves. In the UK that number makes up seven to eight per cent of our overall sales."

According to AC Nielsen statistics these smaller formats, which come in 175ml, 187.5ml and 250ml only represent approximately five per cent of all on-trade sales in the UK. However, it is important to note they are the fastest growing format with the 175ml measure, showing 67 per cent volume growth.

The idea is catching on but is still to make a big impact on the market. So why should you consider introducing single-serve wines into your pub?

Why single-serve wines?​

• They make you money​

According to research carried out by Pernod Ricard, which sells some Jacob's Creek in single-serve format, you can really improve your cash margin with single-serves. "Fractional bottles are a profitable way to retail wines in the on-trade… delivering more margin than RTDs at a similar retail price."

They save you money​

Geoff Read, chairman of Read's World of Wine, the company behind single-serve distribution and marketing brand the Minicellar, argues single-serves are a no-brainer when it comes to saving money. "Think of the money you save through no corkage, no returns and no wastage. Plus what you buy and sell is measurable (because you are not breaking it down with by-the-glass sales and resultant wastage)."

And the Pernod Ricard research concurs: "There is less waste, and therefore a better rotation of stock during less busy times of the day. Plus it means there is easier serve operationally at busier trading times."

They ensure quality​

There is no doubt that having smaller bottles almost entirely gets rid of the problems of corked and oxidated wines. As Clare Griffiths, vice president of brands marketing at Constellation Europe, puts it: "Recent consumer research we carried out into wine purchase habits in pubs revealed too that consumers have a real concern over the care of wine. The fact that nearly all minis are bottled under screwcap, and therefore free from cork taint, reinforces this care of wine to consumers."

They can help you grow the whole category​

Geoff passionately believes that a simple branded single-serve offer can act as the starting point for an impressive wine offer.

"You can start off with a simple offer and you will have the confidence that your wines will not go off," he says. "And once you feel your consumers are increasing in confidence then you can expand your offer and make things more complicated if you want to.

"We are not the only solution but we are part of an overall wine offer. It's not about stealing market share, it's about growing the whole market."

The smoking ban​

Almost every drinks category is claiming it will gain some sort of benefit from the smoking ban. But wine, with its association with eating and appeal to the more senior end of the family, is in a particularly beneficial position.And Geoff believes this is where single serves can come in. "We have to look at where this industry is going - look at Ireland since the smoking ban where beer sales are down six per cent and wine sales are up 10 per cent," he argues. "But not many people actually want a whole bottle nor do a group of people want to settle for the same wine."

How to market them​

• Back bar fridges​

For the last few years top shelves of the back-bar fridge has long been a no-go area for anything other than premium packaged lagers (PPLs) and RTDs. But the recent decline in the latter category has suddenly left the door wide open for a newcomer. While Magners has made a fairly significant claim already, single-serve wines fit the profile Research from Pernod Ricard concludes: "Display is a crucial means of growing wine category sales, therefore let consumers know you stock fractional bottles, and this will reassure them that wines are fresh."

On bar top​

One of the big problems with wine is how small the labelling is to the naked eye. Spirits are given a central marketing position on spirits rails. But to actually market wine directly to the customer is a tough one - behind the bar it can be hard to see and there really is nowhere for it to go on the bar top.

However, Geoff believes with single serves there is a solution. "You can also put single-serve whites into ice buckets and put them on the bar if you don't want to put them into back-bar fridges - this can look very attractive," he argues.

But...​

You need to make sure you have the right kind of pub for single serves. So you need to ensure you do a lot by the glass and that you will get through your stock quickly and regularly. Because as Andrew from Sutter Home points out, smaller bottles have less shelf-life than normal bottles.

"They are more fragile when it comes to shelf-life," he says. "They need to be gone within six months of bottling. Some wines from California take six weeks to get from bottling to the UK, so you've nearly lost two months already. You can't afford for them just to sit there."

Plus single-serve may not be to the taste of every licensee and retailer. You may prefer the sharing aspect of retailing normal-sized wine bottles.

Myles Doran, marketing manager of the Barracuda Group, is a great believer in the "sharing" proposition with wine.

"We do very little by the glass,"he says. "We love the idea of people buying bottles of wine, having ice buckets, and sharing them - it really adds to the atmosphere and ambience in the venue."

Take the single-serve plunge​

So if you are interested, get in touch with a supplier or your area manager, who can give you advice on stocking policy and the best way to market single serves.

Or you could use a resource like the Minicellar, owned by Geoff Read, the man behind Ballygowan in the 1980s. The company allows you to pick and choose which single serve brands you want to stock and gives you tasting notes and, if you want, branded bar-top stands to display the product. Single-serves look like being a major part of the future of wine retailing in pubs. They will make looking after your wine offer a much easier job. In many ways, it's a no-brainer.