SHARI MOGK-EDWARDS Vice-President, Products, Sales

CALIFORNIA WINES
AT
SHARI MOGK-EDWARDS
Vice-President, Products, Sales & Merchandising
Toast to California Trade Luncheon
April 11, 2016
REST OF
CANADA
ONTARIO
SALES OF
$4.2B
TOTAL
$2.2B
$6.4B
WINE IN CANADA
Source: Statistics Canada
Net sales of
+$5.2B
in 2014/15
LCBO transferred
+$1.8B
DIVIDEND
to Government
of Ontario
for 2014/15
Ontario's
beverage
alcohol market
worth
$10B
LCBO holds
51.7 %
of Ontario
beverage
alcohol market
654
7,850
Stores across
Ontario
Employees
7.8
Million Shoppers
each Year
3,200
+130
Million
Transactions
Annually
Suppliers
$7.0
$6.0
$5.0
Annual
Sales
Growth in
Billions
+3.9%
+2.2%
+4.3%
+6.4%
+4.9%
$4.0
$3.0
$2.0
$1.0
$0.0
2012/13
2013/14
2014/15
2015/16 (A)
2016/17 (F)
MERCHANDISING
STRATEGY
Be the retailer of choice for
beverage alcohol for
customers of Ontario – with
a focus on Spirits, VINTAGES
and Craft Beer, while LCBO
Wines and Beer drive turns
and traffic.
Wine Sales at LCBO
LCBO
Wines
$1.44B
VINTAGES
$0.51B
26%, +7.4%
74%, +4.5%
Total = $1.94B
R13 P13
Total Wine Sales by Category
Ontario
Wine
$456M,
+8.0%
New World
Wine
$813M,
+5.1%
European
Wine
$671M,
+4.3%
Total = $1.94B
R13 P13
Millions
Wines Price Band Trends
$450
+13.1%
$400
$350
LCBO &
VINTAGES
+4.1%
-5.7%
+2.8%
$300
$250
+2.8%
$200
$150
+7.3%
$100
+3.5% +3.6%
$50
$0
+11.0%
<$8.00
$8.00 <$10.00
$10.00 <$12.00
$12.00 <$15.00
$15.00 <$20.00
$20.00 <$25.00
$25.00 <$30.00
$30.00 <$40.00
$40.00+
R13 P13
California Wine
at
LCBO Average Retail Price for Wine
$20.00
$15.83
$18.00
$16.00
$14.00
$12.00
$12.45
$13.33
$14.26
$14.89
$15.10
France
Italy
$18.59
$15.61
$10.00
$8.00
$6.00
$4.00
$2.00
$0.00
South
Africa
Ontario
Austalia
Weighted average – 750mL
Spain
California
New
Zealand
R13 P13
California Customer Favourites
Cab
Sauv
+14%
$115M
Red Blends Chardonnay
+4%
$47M
+11%
$40M
Pinot
Grigio
+9%
$18M
Merlot
+11%
$13M
R13 P13
California Wine Sales at LCBO
$268M
In Millions
300
250
$235M
$207M
+9.4%
200
150
$294M
$326M
+12.3%
+14.5%
+20.1%
+13.4%
2012/13
2013/14
2014/15
2015/16
2016/17 (P)
LCBO Wine California Sales
In Millions
200
160
$139M
$121M
+11.5%
120
80
$155M
$172M
+14.8%
2012/13
+11.3%
2013/14
$179M
+4.1%
+11.3%
2014/15
2015/16
2016/17 (P)
Market Share Breakdown
Other
0.7%
Ontario
29.8%
PNW
0.4%
France
8.0%
Germany
1.6%
Italy
17.2%
California
13.6%
Australia
10.5%
Chile
6.1%
Argentina
New
3.9%
Zealand
1.8%
LCBO Wines
Portugal
1.8%
Spain
2.4%
South Africa
2.2%
R13 P13
VINTAGES California Wine Sales
$100
$86M
$96M
$114M
$121M
$147M
In Millions
$75
$50
+4.2%
+11.4%
+19.2%
+6.4%
2013/14
2014/15
2015/16
+21.3%
$25
$0
2012/13
2016/17 (P)
Market Share Breakdown
Ontario Other PNW
4.9% 2.4% 2.3%
France
16.6%
California
25.4%
Italy
18.4%
New
Zealand
8.7%
Chile
3.1%
Argentina
3.8%
VINTAGES
South Africa
Australia
1.4%
5.6%
Germany
0.3%
Portugal
1.6%
Spain
5.6%
R13 P13
California Events
with
Structured Tasting, Reception & Dinner
June 13 & 14
Robert Mondavi Winery
50th Anniversary
Walk-Around Tasting
September 2016
California Walk-Around Tasting
The Changing Marketplace
Premier’s Advisory Council
“We believe that
the LCBO should set
itself the goal of
being the BEST
RETAILER OF LIQUOR
IN THE WORLD.”
-Ed Clark, President and CEO,
TD Bank Group
24
Grocery Store Sales
Over the next decade
• Up to 300 Ontario grocery stores
selling wine
•
•
150 Universal
150 Co-located winery retail stores
(existing, grandfathered)
•Up to 450 grocery stores selling beer
and cider
25
Grocery Store Sales
Phased-in implementation
•60 beer licenses issued last year
•70 beer/wine/cider by end of
2016
26
New Opportunities for Importers
•New sales channel for wine, cider and beer
importers in grocery
•End of Bag-in-Box moratorium on imports
•Products of the World: Greece, Portugal, Spain,
Kosher wine, more to follow
•Launch of e-commerce later this year
27
4 Keys to Success at LCBO
1. Share Information
2. Invest in LCBO Programs and ABTL
3. Partner with a strong agency with a
proven track record in the market
4. Bring us your best
5 Key Opportunities
LCBO Wines
o Premium Reds
o Aggressive Discounts
VINTAGES
o Strategic Pricing for Ontario Market
o Zinfandel
o Diversity from Chardonnay
Price
is what you pay.
Value
is what you get.
-Warren Buffet
.................
THANK YOU!