Market Trends of Middle East & Africa Wine Industry
This section covers the major market trends shaping the MEA Wine Market according to our research experts:
Changing Lifestyle and Consumption Habits of Wine
In most countries, wine is considered a part of the diet, and in a few others, the consumption of wine is not encouraged. The reasons might be religious or health-related concerns. According to the World Health Organization, spirits are the most popular alcohol in the United Arab Emirates and Africa, followed by wine. Further, rising westernization in the country opens room for opportunities for wine market players as wine is considered in the premium category.
Most of the population belongs to the high-income group, and thus, they seek quality wine without any price barrier, thus propelling the market growth significantly. The younger generation has enthusiastically embraced sparkling wines, including, but not restricted to, champagne. This indicates that sparkling prosecco continues to expand its global reach, overtaking champagne. According to the United States Department of Agriculture (USDA) 2020 report, white wine grape varieties contribute 66% of the total wine grapes produced in South Africa. White wine varieties, such as Chenin Blanc, are the most widely grown white wine grape variety in South Africa.
Moreover, sparkling white wine is highly consumed among Arabians as compared to any other category because of the high popularity of Friday brunch with sparkling wine. Further, sighting the rising demand for wine in the United Arab Emirates, the two largest premium liquor distributors, Maritime and Mercantile International (MMI) and African + Eastern, launched the first home delivery service, wines, spirits, and beer in Dubai in 2019.
Supermarket/Hypermarket Holds a Prominent Share in the Market
The supermarkets/hypermarkets segment accounts for a significant share of the market owing to the relative availability of a variety of wines of different types and brands, diverse price ranges, and attractive promotional offers, which augments the product's sales via these channels. The dedicated shelf space at these channels allows consumers to compare wines' origins, review critics' ratings, and choose whatever suits them. Additionally, supermarkets have an increasing presence in urban areas, which ensures higher footfall. Such services at these stores are driving the demand through supermarkets/hypermarkets.
The bottled wine at these stores is often bulk wine sourced from the producer in large containers and later filled into retail bottles. Due to the COVID-19 pandemic and the restrictions on physical movement and social gatherings, many consumers shifted to supermarkets for grocery and wine shopping, thus, significantly accelerating wine sales and market growth. The leading hypermarkets and supermarket retailers in the Middle East and Africa region are Shoprite, Carrefour, and LuLu Group. According to a survey by Edge by Ascential, Shoprite is the leading hyper-store and supermarket retailer in the Middle East & Africa regions, with sales estimated to be worth USD 8.3 billion in 2021.
