Assessing Competitiveness In Moldova's Economy - Economic Growth

Development Alternatives, Inc. Moldova Competitiveness Assessment: The Wine Cluster—Annex A
recently from 20–30 percent to 4 percent, since the beer market is getting saturated. A
common opinion is that people in Russia will always drink vodka. But those who prefer wine
usually drink less vodka, which is more popular in specific segments of the population; so
these products do not necessarily compete for the same market. And unlike wine, vodka and
beer consumption are seasonal, with vodka being more popular in winter and beer in summer.
Non-CIS Imports
Imports from non-CIS countries account for roughly 40 percent of total imports. This market
is highly structured and divided among a few importers. They usually focus on this segment
alone and do not compete directly with each other, often having exclusive distribution rights.
There are practically no new companies entering the market. On the wine market overall, 40-
45 percent of all brands are being sold through exclusive distributors.
French (14.4 percent of imports) and Italian (5.1 percent) wines are the leaders among non-
CIS sources. In recent years, the popularity of Italian wines has been growing faster than that
of French wines. They are considered to offer a greater variety of taste. Italian exporters have
organized a major marketing campaign, including exhibitions where lots of Italian producers
and winemaking associations participated. Italian restaurants are also widely popular. The
majority of French and Italian wines on the market cost between RUB 250 and RUB 500.
However, French wines are available in every price category from RUB 200 (not cheap, but
affordable) to RUB 1,000 and up. Spanish wine (4.2 percent of imports) has been gaining
market share in recent years.
The share of New World wines is the fastest growing in this category. More people now learn
about Chilean, South African, and Argentinean wines. These wines are new, exotic, and
popular. Price is more or less affordable and the quality is good. Chile and South Africa
occupy middle and higher price segments and target already saturated consumers.
Chilean wines typically cost between RUB 250 and 600/bottle; they are being promoted
aggressively through wine festivals, wine tasting, and so on. Californian wines find it hard to
compete with them on price and also with their aggressive marketing campaign. But
American producers also try to create an image of American wine in Russia and host festivals
of Californian wines. They do not expect to be able to challenge French wines, but they are
making consistent efforts to take a hold on the Russian market. South African wines are in a
similar category; with prices ranging from RUB 350 to 500 per bottle.
Recent Argentinean imports have targeted the low-priced segment, in part taking advantage
of the peso devaluation, with prices ranging from RUB 114 to 155 per bottle, in the same
category as Moldovan wine of a slightly more expensive type. While Argentinean wine is a
new trend on the market, it remains to be seen if it will be able to challenge Moldovan wines.
Importers feel that Chilean and Australian wines were known before the introduction of
Argentinean wines. Argentinean wine has been promoted, but to a lesser extent than Italian
and Californian wine; nevertheless, it occupies a spot next to the high-end wines in
promotional materials. A Russian producer of good quality Moldovan wines, with factories in
July 2004 • DRAFT Page 19