Champagne is an amazing global brand.
Visit wine makers using the “méthode traditionelle” in the Loire valley (e.g. Vouvray) and the Languedoc (e.g. Blanquette de Limoux) and they will tell you Champagne can charge three times as much as than they can, just because of the name – the product in their eyes being very similar.
So here we are, approaching the festive season and I saw an ad this week for 50% discount on Louis Chaurey Champagne at M&S. Even better, they throw in another 25% off when you buy two cases, and delivery is free on orders over £50. That comes to £12.38 a bottle! You immediately think “wow that’s amazing, and I’m going to need some bubbly to get me through the next 30 days, let’s buy some. Get in!”
But pause… it might be a great deal, but it could also not be one.
There are various tactics that retailers may use to allow them to create such amazing discounts. In an excellent article by Suzanne Kapner of the Wall Street Journal, Nov 2013, most are exposed. Discounts are often already built into the product. Suppliers sell the product at a low price to the retailer, but state an RRP which is much higher. The retailer sells this product at the full RRP for a period sufficient to evade Advertising Standards Agency scrutiny, and then discounts the product to what appears to be loss making levels, when in fact they are still making a profit.
Champagne is an ideal candidate for this practice, for two reasons.
First as mentioned above, despite high production costs, the suppliers make excellent margins due to the premium value of the Champagne brand. As long as the RRP remains high they don’t dilute the brand, and in a partnership with a retailer, they can provide stock at a much reduced price if volume commitments are fulfilling enough.
Second, selling Champagne at a full, over-inflated price from mid-August to mid-November (post wedding and pre festive seasons) doesn’t hurt them that much, due to seasonality. Google trends show that the interest in Champagne during the year is on average a third of its peak during the festive season. AdWords corroborates this, showing December search volume for the term “Champagne” being more than twice the average of August to October.
Nevertheless, this doesn’t accuse M&S of misleading the public, as the deal might still be a good one – and I think in this case (‘scuse the pun), £12.38 a bottle is as good as you’ll get.
So here are my tips on how to cut through the potential misleading deals on Champagne (and more generally on everything else):
- Check out the product itself and look for signs of quality.
- The Louis Chaurey champagne is from the three main grapes of the region, Chardonnay, Pinot Noir and Pinot Meunier, not some obscure alternative. Tick.
- It carries the appellation “Champagne” which is heavily regulated and protected. Tick.
- It’s a non-vintage product, which means it will contain the produce of various years rather than just one. This is extremely common in Champagne. It just means it’s not a premium single vintage product. Fine.
- M&S have secured a direct deal with Philippe Launois, a French wine merchant. You can expect the grapes to come from various parcels which again is common but indicates this is not a premium product. Fine.
- Check about the origin of the product. Is the supplier renowned for quality?
- M&S are a reputable business typically working only with quality suppliers.
- Philippe Launois is on the Board of the Champagne wine merchants association (Syndicat Professionel Des Courtiers en Vin de Champagne) so he is very experienced and has a reputation to preserve.
- Perform some additional online research about the product, find out about historical pricing and look at product reviews.
- I have seen this champagne as low as £10 on hotukdeals.com 6 years ago and again at £12 a year ago, and the Telegraph also had a promotion 2 years ago at £16/bottle. Those deals have expired, but show it’s a product that definitely tends to be discounted, reinforcing the “discount built into the product” theory.
- Stock levels seem to have been an issue, some shoppers complaining that the deal was live, but when they went to buy, stocks had run out.
- Reviews overall tend to be good with a rating of 4.7 on the M&S site, 83.8/100 on celltracker.com and 3.6/5 on Vivino.
In summary, gut feel to me is that this is a good deal, but perhaps not an incredible one. If your friends and family aren’t too fuss about quality, and you need quantity, then you should jump on it.
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