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Champagne sales have dropped a lot in the past year—down 15.2% from last year. This is worrying because summer is usually when people drink the most bubbly, with weddings, graduations, and outdoor parties.
During a quarterly earnings call, LVMH’s CFO discussed this decline.
Jean-Jacques Guiony said, “Champagne is quite linked with celebration, happiness, et cetera. Maybe the current global situation, be it geopolitical or macroeconomic, does not lead people to cheer up and to open bottles of Champagne. I don’t really know.” He added, “The matter of fact is, is that our volumes are down double digit.”
He didn’t say more about what he meant by the ‘global situation’. Was it civil unrest? Inflation? War? Who knows. But David Chatillon from the Champagne Houses lobby gave more details to Fox Business.
Chatillon explained, “The gloomy global geopolitical and economic situation, as well as generalized inflation, is weighing on household consumption. Champagne also continues to suffer the consequences of overstocking by retailers in 2021 and 2022.” Clearly, other factors might be at play too.
Think about it—Gen Z drinks less than older generations. A study found 28% of Gen Z doesn’t drink alcohol compared to 20% sixteen years ago. That’s just one piece of the puzzle.
Inflation plays a role as well. With prices rising for everything, people have less money to spend on luxuries like champagne.
And Jay-Z won’t be swooping in to save the day after his fallout with Cristal years ago.
Sean Goldsmith suggests in Fortune that people might be waiting for the U.S. Presidential Election to pop their champagne. But reports show Europe’s sales are hit hardest.
Is it just champagne or are people drinking less of everything?
A report from May stated wine consumption is at its lowest since 1996—even though there are 2 billion more people now.
It’s tough to pinpoint exactly why champagne sales are down. The industry needs to act before rising prices push people away from bubbly for good. Funny enough, writing this has made me want to pop a bottle myself. Maybe I’ll knock off early today and celebrate just because!
