Premiumization Boosts Concha y Toro’s U.S. BusinessMarch 30, 2021
Concha y Toro’s U.S. subsidiary Fetzer Vineyards Co. saw sales increase by just under 20% to $177 million in 2020, driven by a more premiumized mix within the portfolio and boosted by exchange rate effects. Company volume was down 2% to 4 million 9-liter cases, according to Impact Databank. The U.S. and Canada account for about 20% of Concha y Toro’s global sales.
Fetzer’s U.S. gains were led by its premium stable, including labels like Casillero del Diablo Reserva, Bonterra, Marques de Casa Concha, and Cono Sur Organico, offsetting declines on lower-priced entries like Frontera. The company said fourth-quarter sales were especially strong for Bonterra (+32%), Trivento Reserve & Golden Reserve (+22%), Marques de Casa Concha (+500%), and Cono Sur Bicicleta (+31%). According to Impact Databank, Bonterra, known for organic wines, was up 9% to just under 500,000 cases last year, while the Concha y Toro brand held roughly steady at 2.1 million cases.
“Bonterra continues to drive organic leadership with quality offerings at a time when the organic wine category is up 25% in IRI channels over the past year,” Rodrigo Maturana, Fetzer Vineyard Co.’s senior vice president of marketing, told SND, adding that the brand’s Sauvignon Blanc, Chardonnay, and Cabernet Sauvignon varietals were all up by double-digits at retail.
Among Fetzer’s South American brands, Casillero del Diablo’s growth has been focused around Cabernet Sauvignon, Carmenere and Malbec, while the Argentinean Trivento label recently augmented its range with a Maximum Red Blend, named for winemaker Maximiliano “Maxi” Ortiz. “As recognizable brands from Chile and Argentina with accessible, quality offerings, their respective growth aligns with purchasing trends over the past year that saw consumers gravitate towards well-known brands with strong distribution in the off-premise space,” said Maturana.
Globally, Concha y Toro’s sales totaled just over $1 billion on a 17% increase last year, with wine volume up 4.6% to 35 million cases, owing to rapid gains in export markets and a solid showing in its domestic market of Chile. EBITDA for the company’s full fiscal year leapt 42% to $203 million.—Daniel MarstellerSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.