Since the Covid-19 emergency forced us all more or less to stay home, there has been a lot of talk about the growing role of food - also on a psychological and social level - in tackling "segregation". But what about the Beverage sector? For us Italians, eating well also means skilfully pairing a well-presented dish, prepared meticulously with quality ingredients, with a glass of good wine.

Sales figures remain positive

And this passion for fine wines, in moderation, is reflected in sales trends, as confirmed by Nielsen's findings. From the start of the epidemic (17 February) to the first reduction in measures (3 May), supermarket sales of alcohol witnessed two-figure increases for all the main product categories: wine (+11.0%), alcoholic beers (+12.8%) and alcoholic aperitifs (+14.4%). And if a glass of good wine is essential to a good meal, excellent coffee is its worthy conclusion: hence the two-figure increase in ground coffee (+17.3%).

However, some caution is required when translating positive sales figures into financial data. According to Mediobanca's calculations, net margins in the Beverage segment were only slightly positive in the first quarter of 2020 (+0.4%), but this is despite a 10.1% drop in gross margins, confirming the sector's ability to create added value. As far as exports are concerned, the Nomisma Wine Monitor reports that Italian wines enjoyed a positive performance in the first two months of 2020 but fell back in March, with some markets offsetting the losses of others. The US stocked up in view of the possible application of duties (+16.8%), easily offsetting the drop in China (-13.3%).

So could the solution be to focus even more on quality and value? Robertino La Monaca, chairman of Novaripa, explains: “In recent years we have paid very close attention to winemaking processes, as confirmed by BRC/IFS certification. With a keen eye on the global market, this has allowed us to make wines that are increasingly in step with the times, such as a coppery Pinot Grigio which is very popular with young consumers, or a very rare Viognier Abruzzese. Consumers are also increasingly attentive to organic and field-to-table products: we already produce organic wines and have been implementing a sustainable agronomic policy for several years now, with strict controls in the vineyards, because sustainability starts in the fields”.

The weight of Ho.Re.Ca. and alternative solutions

For wine, domestic consumption represents an important share which - also thanks to this quality sprint - has improved opportunities for home delivery during lockdown. The alternative solutions being investigated include an early harvest, customised bottles and the development of domestic wine tourism. The spirits market looks more uncertain, as it depends much more on out-of-home consumption. Let's consider “amari” (bitters), a category that is experiencing a successful revival, setting a trend. According to IRI data, in the last four years (2016-2019), Ho.Re.Ca. sales have grown 12.3% in volume and 16.1% in value, thanks to a marked upturn, especially in restaurants and daytime bars. These areas have been severely affected by the lockdown. A solution that is beginning to emerge could be represented by virtual “Amaro Bars”, portals that are trying to replicate the success of wine delivery services.

A similar dependency on the Ho.Re.Ca. channel will also have to be addressed by soft drinks. The trade association Assobibe estimates that the drop in sales for 2020 could be as much as 30%. In short, innovation, creativity in solutions and the search for alternative channels will probably be required by all segments of the Beverage industry if they are to recover in the second half of the year.