Champagne Market - Growth, Trends, and Forecasts (2023 - 2028)

Champagne Market - Growth, Trends, and Forecasts (2023 - 2028)

The champagne market is projected to grow at a CAGR of 6.20% during the forecast period (2022 - 2027).

The COVID-19 pandemic adversely impacted the market due to multiple store closures, economic volatility, and an increase in unemployment rates, resulting in a fall in purchasing power and shifting preferences toward essential goods instead of alcoholic beverages like champagne.

Over the medium term, premiumization of the industry remains one of the major factors driving the alcoholic beverage market, particularly spirits and wine. A leading player such as Diageo, which elicits one-third of its sales from United States, is increasingly moving to dominate premium champagnes.

Product innovations by manufacturers regarding the usage of organic/natural and vegan ingredients, as well as eco-friendly packaging in case of champagne, are allowing deeper penetration and expansion to new markets across the globe.

Online retailing of alcohol, including champagne, is growing faster. The on-demand delivery apps, such as Drizly, are the driving forces of this segment. ​Recently, prominent e-commerce retailers also entered the market to cater to the increasing demand from consumers. A growing number of Champagne producers are launching direct-to-consumer portals in the wake of the Covid-19 pandemic to increase their online sales. Traditionally, Champagne brands have almost exclusively relied on distributors and retailers to sell their wines. Still, as the hospitality sector continues to struggle, direct-to-consumer (DTC) channels have become an attractive way for producers to recuperate lost revenue. For instance, in April 2020, Champagne Palmer launched its online direct-to-consumer (DTC) shop. Additionally, Uber Eats also expanded its home-­delivery services to alcohol. This factor, in turn, is anticipated to supplement overall sales of champagne through online retailing.

Being native to the region, Champagne witnesses high penetration in the area among other alcoholic beverages. As a result, globally, the European region holds a significant share in champagne consumption, whereby most of the champagne produced in countries like France, United Kingdom, and Germany, among others, is exported to more than 150 countries across the globe. Additionally, the growing prevalence of premiumization in the industry is boosting the value sales of the product. Champagne variants that use descriptors like no taste additives, gluten-free, low carb, vegan-friendly, organic, and paleo-friendly have been gaining prominence among European consumers due to the increasing focus on health-friendly beverages.

The champagne market is fragmented and highly competitive owing to the presence of multiple global and regional players offering various products. Key players in the market include Diageo plc, La Marca USA, F. Korbel & Bros., Cook's Champagne Cellars, and Champagne Taittinger CCVC, among others. These players have been embarking on mergers & acquisitions, product innovations, and partnerships, apart from expanding their production & distribution networks and strengthening their social media presence to garner a larger market share.

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