Spending more time indoors, Brazil rediscovered wine. The drink, previously associated with special occasions and high prices, became more sought after by Brazilians during the pandemic. Eyeing on this, Fabenne, a wine startup based in São Paulo, wants to take advantage of the momentum and popularize the wine consumption: forget special occasions, any Tuesday night is good enough to drink wine.
Data show the rise of wine during the pandemic. According to Ideal Consulting, wine consumption in Brazil rose 30% in 2020, which means 2.78 liters of the drink per adult, a Brazilian record. Last year was an atypical year not only for drinkers but also for Brazilian wine producers. Thanks to the prohibitive dollar quotation and a good harvest of national grapes, Brazilian wines reached 6% of the market.
It is still modest, but some companies have seen this huge potential untapped. Among them is Fabenne, founded in 2017 with a very specific product: “bag-in-box”. The American technology developed in the 1970s to transport lithium batteries was adapted in Australia to conserve wine and became a worldwide success. Adriano Santucci, co-founder and CEO at Fabenne, says that in Australia the bag-in-box accounts for almost 50% of the wine consumed in the country. “The two largest wine brands in the world, the American ones Franzia and Bota Box, are bag-in-box,” he says.
The highlight of the bag-in-box is its durability. Inside the box, the wine is packed in a special resin layer and has an airtight dispenser, which prevents air from entering when a glass is served. Thus, the wine lasts up to 30 days maintaining the quality.
Each Fabenne bag-in-box contains 3 liters. For now, the portfolio has three fixed varietals – Cabernet Sauvignon, Moscato Giallo (white) and Rosé -, all coming directly from the cooperative Vinícola São João, in Farroupilha, in the Rio Grande do Sul. Fabenne’s forecast is to increase the portfolio to eight varietals by the end of 2021.
From restaurants straight to the consumer’s home
In its first year, in 2018, Fabenne tried several business models: they sold to restaurants, events, weddings, retail, emporiums, and direct to the customer. In 2019, the startup chose food service and direct selling, attracting customers through the website. At that time, food service accounted for 75-80% of sales.
At the end of 2019, Fabenne received an investment of BRL 1.7 million from family and friends. With the restrictions imposed by the pandemic, the startup had to rethink its business model once again and invest in e-commerce.
Adriano and his two partners, Arthur Garutti and Thiago Santucci, opted for e-commerce because Fabenne’s product is highly recurrent and predictable, that is, Fabenne can manage its stock so that the product never runs out for the customer. “Friday night wine is always guaranteed,” jokes Adriano.
The choice was right. In 2020, Fabenne served 10,000 customers and had a revenue of BRL 4 million, an increase of 315% compared to 2019. Much of this growth came from direct sales, although a small base of partner restaurants, around 350, continues to buy. Restaurants, which used to be the bulk of Fabenne’s clientele, are now only 10%.
For 2021, Fabenne’s goal is to quintuple the operation, reaching 50,000 customers and BRL 16 million in revenue.
Wine can be good at any time
Adriano believes that the increase in Brazilian wine consumption is mainly due to the pandemic, which has driven behavioral change.
Fabenne, says Adriano, believes that the Brazilian only does not drink more wine because it is expensive. Therefore, the startup wants to make wine more accessible and demystify this common idea that wine can only be consumed on “special occasions.”
“The bag-in-box is a great way to consume wine because it deconstructs that common sense that you need a ritual to open a bottle of wine, that you need to harmonize with the meal. The box format is uncomplicated and the price per glass is better. “
Each bag-in-box with 3 liters costs BRL 99.00 and yields about 20 glasses, a cost of BRL 5.00 per glass. With that price, Adriano believes that the Brazilian starts to consider drinking wine more often. The prolonged durability of the bag-in-box is also a facilitator compared to the bottle, as it is not necessary to consume all the wine under the risk that the drink will spoil.
Adriano emphasizes that Fabenne does not want to compete with bottled wines. He argues that the two products can co-exist: the bag-in-box for the most frequent consumption and the bottles for special occasions.
“I grew up with wine served for Sunday family lunch, without frills. We want to show the Brazilian that this is how wine is taken worldwide,” says Adriano, referring to European countries where wine is served everywhere and the cup costs € 2.
For Fabenne’s CEO, wine in Brazil is reputed to be an expensive product and wineries and importers reinforce this stigma, which sometimes alienates potential consumers.
For this reason, the startup does not yet have plans for international expansion. “Our initial mission is to be one of the leaders in changing the behavior of Brazilian consumers about wine.”
Translated by Carolina Pompeo.