The relationship between producer brands and retailer brands in the UK table wine market
Back in the early 90s at Southcorp we were having trouble getting UK supermarkets interested in our Penfolds and Lindemans brands. The Australian sector was in its infancy and therefore of relatively little importance to them. Jacob’s Creek was the go-to brand, and there were few Aussie own-labels.
At that time I was a classic brand marketer. My business school training and marketing education within the Courage Group had taught me that “proper” brand owners should focus on building their own brands – not supply own-label and certainly not countenance retailer exclusives. Both would represent a sign of weakness.
Own-label back then represented around 35% of all table wine sales in the off-trade, much as it does now, but becoming a supplier of, say, German own-label at the same time as building the Black Tower brand was not an option we considered. The strategy was very simple: invest in consumer advertising to build a franchise and make the brand a must- stock line. The supermarkets were simply one route to market; developing relationships with them was important but not to the extent that one offered them cross-category solutions.
My “road to Damascus” experience came at a meeting with Sainsbury’s, who were more committed to own-label than most. They were concerned that Jacob’s Creek was getting too important and wanted to develop an Australian range that brought it down to size. We came up with a cunning plan.. We would supply a number of own-label wines to sit under JC and a few Penfolds/Lindemans wines to sit on top: Jacob’s Creek would become Jacob’s Squeak. The result of ‘Project Anaconda ‘ was interesting. We did extraordinarily well, but so did JC as Sainsbury’s developed a reputation as a retailer of Australian wine