Gallo to make £5.99 central price point

Published: 07 April, 2009

E & J Gallo hopes to drive premium Californian wine sales in the UK with the national roll out of its Redwood Creek brand and a commitment to make £5.99 and upwards its central price point for the UK.

E & J Gallo hopes to drive premium Californian wine sales in the UK with the national roll out of its Redwood Creek brand and a commitment to make £5.99 and upwards its key price point for the UK.

Whilst its 2008 activity centred around high profile awareness campaigns such as the sponsorship of Channel 4's F, its 2009 focus will be on converting more wine drinkers to Gallo brands through concerted in-store, point of sale and direct marketing activity.

Redwood Creek, already a two million case brand in the US, is to be rolled across all grocery and impulse channels after success in the on-trade and listings at Morrisons and Thresher. Retaling at £6.99 it is aimed at the ABC1 35-65 year-old consumers who like outdoor pursuits, walking and trekking.

It will sit alongside its existing premium brand, Turning Leaf, which is being re-launched as a stand-alone brand with new packaging and better wine quality with more focus on the "leaf" motif.

The moves are part of Gallo's overall strategy to capitalise on the gap in the UK market for hero wine brands. "The market is crying out for bigger wine brands," said Iain Newell, E & J Gallo's marketing director for Europe. "The number one brand only has a 5% share."

The summer will see new packaging and improved 07 and 08 vintages for its flagship Gallo Family Vineyards range with a cleaner, more premium design and bigger focus on the wine's varietal. "We want to make consumers who are aware of the Gallo brand to pick up a bottle," added Newell.

It is therefore investing the bulk of its 2009 marketing spend - which Newell says is on a par with 2008 - on in-store activity, point of sale promotions and better use of targeted online direct mail activity.

A Taste Tour roadshow will put more Gallo wine into consumers' hands around the country and it will be running a series of competitions to win so-called "Gallo Gatherings" for friends and family be it a dinner party with your own chef and sommelier or BBQ or summer party.

Nick Elkin, E & J Gallo's sales director, confirmed the company would be prepared to sacrifice some volume in the UK market if it meant driving more value into the business through sales. But it was a case of getting the balance right between using price discounts to "convert more sales" without over promoting. He expected "slightly" less promotions in 2009.

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