The French wine industry is under increasing pressure, in France and abroad, but it still has options. So how will it adapt to the changing landscape?
Wines and spirits constitute the second French export after aerospace. Although France undoubtedly produces the best-known wines, the commercial aspect of things, like any business, is subject to its market. As most business leaders will tell you, the market is dependent on marketing, and France has some of the strictest alcohol marketing laws.
Under the Évin Law of 1991, alcohol advertising is not permitted on television, and liquor companies are prohibited by law from sponsoring cultural or sporting events. The law has been widely criticized for its child protection purpose, several studies having concluded that “the 2015 version of the French Évin law does not appear to effectively protect young people against exposure to alcohol advertising in France”. An amendment, proposed in 2015 by Emmanuel Macron, sought to distinguish between advertising and ‘advertising in order to help promote wine production associated with a region in France’, but the bill was censored. Macron also recently spoke out in favour of new changes to the law that will deregulate wine tourism advertising in France, but without changing “either the philosophy or the objective” of the law. The reasons for these changes are essentially economic and aim to help regional wine producers in France.
French wine producers and exporters have recently faced several other major challenges, including increased competition. With the rapid development of New World production, competition is intensifying and many traditional French producers find it difficult to adapt to the profiles and tastes of modern customers.
The effects of climate change are also undeniable, considering recent changes in harvest times and unpredictable weather conditions. In 2017, French wine production fell by around 20% due to various climatic phenomena, which had a significant effect on its export capacities for the next decade.
Two of the biggest importers of French wine are China and the United Kingdom. In 2018, figures also showed a 25% drop in French wine shipments to China, and the British currency is weakening – by around 20% since before the referendum, making importing French wine much more expensive. Jason Yapp, an independent wine merchant in the UK, believes French wine will become up to 25% more expensive in the next 12-18 months .
“I think it’s a disaster. Only two producers we deal with have made price concessions following the devaluation of the currency.”
So a great solution to all these challenges seems to be diversification. Wine tourism helps offset fluctuations in wine production and sales, is not subject to alcohol advertising laws, and helps redistribute income and jobs to areas of the country that typically have more modest incomes, but benefit from an attractive climate and landscape. Recently adopted economic reforms concerning the French labor market and the reduction of bureaucracy were undertaken with the aim of reducing costs for companies and making them more competitive in the global market.
Initiatives such as ruedesvignerons.com are designed to help winemakers approach the international market, providing them with the platform and network they need to present their wines and offerings.
Of course, budding wine tourism hosts will have to invest, in their land and buildings, but also in their staff, to develop the language skills and customer service of their team. Most wine tourists come from the USA and Northern Europe, so speaking English is a must (a little joke for wine makers).
Welcoming guests builds a relationship that lasts long after the bottle of wine is gone
Winemaking is a beautiful and ancient profession. The world deserves to know more about it.