Independent South African commentators have been strident in their criticism of Wines of South Africa (WOSA), South Africa’s generic wine marketing agency, directing an overdose of vitriol in particular at CEO Su Birth and Communications Manager Andre Morgenthal.
There is a reasonable argument that the criticism is no longer constructive and has become damaging. It is also broadcasting a potentially divisive image to wine buyers and influencers in major export markets.
Many questions arise, including the challenges wine marketers face on the international stage. Not least – as noted by Neal Martin of the Wine Advocate – are the perceptions created in customers’ minds from decades of negative publicity surrounding apartheid, crime and corruption, not to mention scandals like illegal wine additives.
Martin, who was recently in South Africa to judge for the Old Mutual Trophy Wine Show, feels that memories of negative events still linger and are bound up in the mental processes that precede the decision to buy.
“You need to be a bit more positive about your own wines and have a bit more confidence in them, because in the end that is what people want to hear about. You need to sell personalities, people buy stories,” says Martin.
These are the perceptions WOSA and its exporting members must face – that’s after they have overcome a global recession, a strong Rand, global oversupply, retailer and producer consolidation and a highly competitive and dynamic export market.
Despite this, WOSA’s achievements are considerable, not the least of which is the diversification of risk over the past decade by helping the industry reduce dependency on traditional markets like the UK and Netherlands.
WOSA has done pioneering and widely acclaimed work through the Biodiversity and Wine Initiative (BWI) and the sustainability seal – a world first. The Cape now boasts more land devoted to conservation than to vineyard and where they meet specific environmental and employee guidelines, producers may use – following an independent audit – the sustainability seal. By 2010, 60% of producers had qualified to use the seal.
WOSA has made possible the funding of the Wine and Agricultural Industry Ethical Trade Association (WIETA) via the Common Customs Tariff (CCT) rebate afforded to a percentage of South African wine exported to Europe and the United Kingdom. Many of the UK retailers benefiting from this rebate have agreed that this saving be returned to South Africa to fund various developmental initiatives in the wine industry for 2011.
WOSA is also the architect of the ‘Variety is in our Nature’ positioning, which is supported, for example, by DNA, a booklet for marketers on how they could present Brand Wine South Africa.
Other achievements include the training of wine stewards for the Soccer World Cup in 2010; the Sommelier World Cup; and Cape Wine Braai Masters, a compilation of winemakers’ barbecue recipes that has been picked up by a publisher for a commercial version and from the sales of which WOSA will receive royalties.
WOSA innovations include themed wine workshops held in importing countries and more recently the tasting pods at the London Wine Trade Fair so well received by respected commentators like Tim Atkin MW and Jamie Goode.
CEO Su Birch has garnered two international awards: 2005 Lanson Woman In Wine Trophy, and in 2009 the Drinks Business Woman of the Year Award, and in May 2011 she was listed in Off Licence News as one of the top 75 most influential people in wine. WOSA won the Drinks Business Award for the Best Consumer Campaign for the Great Wine Trail in 2008.
The primary role for WOSA is to build up a positive image for South African wine. It is not a sales organisation and has no sales staff. Its job is to put a positive light on South African wine at all times, no matter what is happening in the trading cycle.
As a non-profit organisation, WOSA must also function with one of the smallest and least-government-subsidised budgets among its competitors including Australia, New Zealand, Chile, Argentina and California while the likes of Germany and Spain have far larger budgets than the New World countries. Meanwhile the EU has made generous allocations for marketing member countries’ wines in Asia and the USA, among the fastest growing markets.
Like WOSA, most of the generic wine marketing organisations are run by boards so, for example, no one individual makes material decisions about strategy and budget allocation. Of course such organisations will contain diverse members with diverse interests so conflict is inevitable and countries like Australia have discovered just how damaging this can be in the absence of compromise and cooperation.
Meanwhile, retail discounters have gained significant share during the recession and even in the UK the traditional supermarket groups have lost share to the discounters. As a result these groups are putting huge pressures on suppliers as they endeavour to regain or retain market share without a dramatic loss of margin.
Volumes into the UK declined quite sharply in 2010 as producers were no longer able to supply wine at the price points and promotions demanded by the supermarkets that dominate the trade.
Like the rest of us, WOSA does make mistakes and cannot keep all its members happy all the time. For example, Birch says that although they are faced with some apathy from producers, internal communications could be improved upon.
2010/11 sees some exciting prospects for WOSA including exploring new markets in Africa and Asia. WOSA is working with the Department of Trade and Industry in China, Japan, India, South Korea and Singapore and facilitated the first generic tasting in Angola this year. Other markets earmarked for growth include Nigeria, Norway, Russia and Japan.