BFM Business Interview | What have wine lovers been buying in confinement?

With signs that the Covid confinement will be gradually ending soon, Angélique de Lencquesaing talked us through her analysis of how consumer habits have changed during this period with Guillaume Sommerer on the BFM Business channel.

So how have consumers reacted during the confinement period? Are they still buying?

Not in the traditional auctions, that’s for sure! Any sale taking place in person has had to be postponed or cancelled, meaning that clients have been focused more on online auctions. And they’ve certainly spent quite some time doing this! On iDealwine’s auction platform, traffic increased by 30 to 40%, and even as much as 50% in the hours and minutes leading up to auction closures.

Traffic might have increased, but does this equal an increase in sales?

The interest that people have shown in the auctions is a really good sign, it shows that people are confident in the future. As we know, this is a key factor when it comes to investing. If these consumers were pessimistic or worried, they wouldn’t be buying, they’d be quite happy to enjoy the bottles they already have in their cellars. Yet they are still making purchases!

Not everybody has a well-stocked cellar…

That’s true. But we have noticed a clear increase in the number of younger clients among our buyers (those under 35). These are clients who haven’t been able to go to wine bars or restaurants recently and haven’t yet built up a wine cellar. And at the same time, interest from our more ‘mature’ clients, if I can say that, has remained high. To give you an indication, the rate of unsold bottles in our auctions has dropped by 40%.

And the stocks of wine we put up for auction have been flying off the shelves. For several weeks, we were unable to visit clients wishing to sell their wines on or to accept bottles at the warehouse either. We are gradually returning to normal service, starting by accepting ‘contactless’ drop offs.

Is it particularly French clients who have carried on buying?

I think that, during the confinement period, the French have shown a particular attachment to everything gastronomy and cooking, and this includes wine! The proportion of French buyers has been over 50% recently – a loyal bunch, especially during difficult times, that much is certain! We saw this during the 2008 financial crisis, the summer of 2011, and now again. A big thank you to them!

What are Asian wine lovers buying at the moment?

Competition is fierce in Asia right now, since local sellers have extensive stocks to get shifted. They’re prepared to sell for low prices in order to kick their business activity back into action. Buyers in Asia are wise to this and are looking out for a good deal. They probably won’t be overbidding for a while.

Looking at some of their finest purchases, it’s clear that big names have retained their desirability: white Burgundy cuvées from Domaine Coche-Dury (whose prices are stabilising at the moment), mature vintages from Bollinger, and collectors’ bottles like Jacky Truchot in the Côte de Nuits and Gentaz Dervieux in Côte-Rôtie. From this latter domain, now no longer in existence, a 1989 vintage was sold for €2,088!

And what’s happening in the United States?

In the US buyers have returned, a nice surprise! They don’t seem to be discouraged by the Trump tax that has been applied to imported wine or by the current crisis. However, unlike our Asian clients, Americans seem to be leaning far more towards more ‘on-trend’ wines, especially those produced naturally.

This includes bottles of Arbois from Domaine Overnoy (Jura), the modest production from Domaine des Miroirs (Jura), Tavels from Domaine de l’Anglore (Rhône), Echézaux from Domaine Bizot (Burgundy).

Have buyers elsewhere in Europe taken a break? Particularly in Italy which has been hit especially hard?

Not from what we’ve seen. Their making more classic choices in their purchases, with big names just as coveted as ever. A 2010 Montrachet from Ramonet auctioned at €1,719. Italians are also buying wine from their own country through our platform, including fine Barolos from producers like Rinaldi and Super Tuscans like Ornellaia.

You’ve just published your wine auction Barometer – is it already out of date due to the severity of this crisis?

No, it isn’t out of date at all! In the Barometer, we’ve analysed the biggest trends of 2019 as well as outlooks for this year. And it was all finished off at the beginning of the confinement. Of course, at that time it was impossible to predict the extent of the repercussions on the fine wine market, but the trends we’ve researched are deeper ones that concern the mid-long term. Not only have we taken this opportunity to look further at the evolution of the market over 20 years, we’ve also provided extensive information about up and coming domains to keep an eye on. This is still very much relevant, and invaluable for anyone looking to invest in wine!

You’re currently holding a charity auction in aid of the Protège Ton Soignant collective. Which of the lots are the best investments?

The donations we’ve received come from over 100 domains. The lots to look out for in terms of investing are: those that stand out for their size (we have a Salmanazar, which is the equivalent of 12 bottles!), lots from exceptional vintages, and of course bottles that will be a safe bet because of their producer.

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