Interview with Denis Rudenko

Interview with Denis Rudenko

Russian wine-taster speaks on current situation in the wine market and on consumer habits
April 10, 2015

Denis Rudenko, Russian wine taster, the founder, and the head of the Center of degustation “750 ml” in Moscow, is one of the most famous Russian wine critics. We asked him to tell us a little bit on what he believes are the future of the Russian market.

Is the situation on the wine market is still stunned by the sanctions and the collapse of the ruble?

The impact of sanctions does not affect the wine market. The collapse of the ruble. According to the agreements, the importers were receiving payments from distributors on average between 30-60 days. The wines were delivered in November with the prices established at the exchange rate 1/40 rubles. At the Christmas time, the euro rose to 90 roubles. According to the contracts which I’ve seen, the importers couldn’t alter the list prices but with a minimum notice of 40 days. All importers have taken this “risk”.

Since the end of January, the exchange rate is more or less stable. The market is recovering. For example Aroma, with 200 stores “Aromatnyj Mir”, including 100 in the capital and in the surrounding region.

But also Azbuka Vkusa, with 78 supermarkets, 4 minimarkets, 2 hypermarkets “Market” and 3 wine specialist.

The latter behaves in a very wise: on its shelves 60-70% of the wine is directly imported and are all positions, from wine to 400-500 rubles to the luxury segment.
Others have their hands tied, they can not change prices and still with the change dancer should gamble. Therefore they tend to reduce the risk by reducing imports and distribution costs.

How final-user lives this situation?

Honestly, I expected a worse situation. I am the founder of the Center for tastings and at first I thought it would be a disaster. However it is not: nowadays we have the same 4-5 weekly tastings and close the registrations for all places no longer in 15 minutes (as it was before), but in an hour, and still remains full.
With the growth of prices known to the consumer tries to find wines that cost a bit ‘less, or buy 2 bottles rather than 3, but it has not stopped to drink wine or not it is right to beer, for example. Perhaps those who drank Chianti reserve, try to buy something simpler, to stay in Tuscany. You do not see that catastrophe, as it seemed at first.

But consumers in search of wine that costs less, does not begin to drink Chile, abandoning Italy? They remain loyal?

I see that there is a large percentage of loyal consumers. Who was buying Italian wine, not going anywhere. Perhaps they are moving from Piedmont to expensive wines of Lazio, Puglia and Abruzzo.

In my opinion, France and Italy will remain the market leader in wine. Because, frankly speaking, were not cost countries: Australia is expensive in terms of logistics, the price of 1 liter of wine in Chile has been growing steadily for the past 10 years. Perhaps, the only fear is Spain, the country psychologically closer to Italy. For the consumer it is very simple ask the question: “If we drank wines Italian why not try the Spanish ones? They also cost less. ” But Spain has a big problem: none of the manufacturers has bothered to create an image of himself and his wines. As we all know, if there is no picture, there is no distribution. In Spain there are many tempranilio noname, people may also appoint rioja, but do not know any manufacturer perhaps, except Torres. Spain does not have the big names, Italy instead.

In your opinion what to do producers who imported in Russia and have invested in the name and picture? Wait?

I would say that if you want to keep the niche and the image of their wine in a crisis situation, you can not have the same expectations of gain, as before. This should be a decisive choice. I personally see only three possibilities. First, it does what already was done with a result foreseeable and a decrease in volumes. Second, decrease the gain to keep the recess. The third possibility: step down in quality, at the risk of worsening the image, but partially preserve both niche is gain. I personally as president and founder of the Center have made a decision to decrease the gain, without a substantial increase in prices. I did it for a simple reason – with the sharp rise in prices in the long-distance will lose more customers. We all know that it takes little to ruin what you have built in 10 years.

I assume that from May to June we get used to the new euro / ruble and the new prices. I do not know for sure, I am not a prophet, every day out news and no one knows what will happen tomorrow, but I believe in the future. I do the same lessons and tastings with the same quality wine and I hope that in the meantime the situation will become clearer and more transparent.