Fewer folks popping bottle tops as champagne sales fizzle
After last year's strong 4% sales gain, champagne makers are feeling the imopact of the sour economy .
Given the tough economic climate, will you cut back your New Year's Eve spending?
Perhaps you'll buy cheaper Champagne -- or spend the night at home rather than paying $100 for a fancy dinner. Or maybe you won't buy a new party dress or splurge on a manicure.
If you are planning on scaling back, our reporter Laura Petrecca would like to hear from you. Please include your full name, phone number and hometown.
There will be little celebration for champagne makers this year.
After last year's strong 4% sales gain, the biggest since the buying frenzy in 1999 to ring in the new millennium, champagne makers are feeling the impact of the sour economy from $5 sparkling wines to $100 bottles of champagne.
"I don't have a bright outlook for champagne this year," says Frank Walters, research director for Impact, which expects the category to be down 1% to 4%, from about 900 million glasses sold in 2007.
"Luxury items are getting hurt, people are looking for value, restaurants are getting clobbered and with unemployment rising, people are watching their shekels."
Other factors stealing the fizz:
•Consumer spending. Scaled back spending hurts champagne hard. The segment racks up 60% of sales from late October to January.
•Shorter season. An early Thanksgiving gave champagne makers five fewer days than last year to get products into stores.
•Bad PR. Advertising campaign "Unmask the truth," put out by trade group Champagne USA, calls attention to products that are not officially champagnes. Many domestic sparkling wines are called champagnes even though the grapes don't originate from the Champagne region of France.
Still, champagne and wine makers and retailers are trying to spur buying.
"Grocery stores are lowering prices almost to cost to get people in to buy," says Gary Heck, president, Korbel Champagne Cellars. "Most stuff is down by $2 to $3 across the board."
Marketers for Martini & Rossi Asti Spumante, which sells for $10 to $13 a bottle, are focusing on store shelves. "We want to make sure our brand is there for consumers to see when they shop," says Celio Romanach, Martini & Rossi's brand managing director.
Luxury brands are trying to reach the still-rich with super-expensive products. Moët & Hennessy bundled its bubbly with high-end gift boxes and packages including a Dom Pérignon Power Trio, a boxed set of three Dom Pérignon vintages with a price tag of $1,500.
For its Piper-Heidsieck Rare, Rémy Cointreau USA introduced a collectible bottle designed by a high-end French jewelry maker