How does the humble New Zealand and Australia division of a Fortune 500 wine, beer and spirit company with a market capitalization of US$45 billion become so critical to the company’s global success?
With an outstanding New Zealand wine brand that makes Americans weak at the knees and a nimble entrepreneurial mindset.
United States-based Constellation Brands has winemaking facilities in the Napa Valley, New Zealand and Italy, and sells its premium wines around the world. Its portfolio includes Napa Valley icons Robert Mondavi Winery and Schrader Cellars alongside Casa Noble Tequila and High West Whiskey.
“We’re like this small, nimble partnership for the organization. Our parent company is a big Fortune 500 providing us with the capital to develop our brands, vineyards and wineries.”
When Stephen Cheadle joined the company in 2017, he was solely focused on improving the Asia–Pacific and Canadian divisions’ operations. Nearly seven years later, he’s the Managing Director of Constellation Brands New Zealand & Australia, and also sits on the international leadership team that governs the company’s sales and operations outside of North America.
“The NZA division has been doing well over the past two years,” he tells The CEO Magazine.
“Constellation Brands has more than 11,000 employees across the world with around 270 of us across New Zealand and Australia; the majority in New Zealand. We’re like this small, nimble partnership for the organization. Our parent company is a big Fortune 500 providing us with the capital to develop our brands, vineyards and wineries.”
Prized Vines
Constellation Brands’ flagship wine brand is New Zealand’s very own Kim Crawford, known for its complex Marlborough Sauvignon Blanc and elegant Hawke’s Bay Chardonnay.
“Kim Crawford is the number one selling New Zealand wine in the United States and Canada by a country mile,” Cheadle explains. “The NZA team is laser focused on ensuring great quality and consistency for our bestselling wine. We sell 2.5 million cases of Kim Crawford globally and we’re exceptionally proud of the brand.”
Despite having Kim Crawford and several other lucrative brands under his belt, Cheadle admits the current market is challenging.
“Wine consumption is in decline around the world, there’s no two ways about it,” he admits. “This implies a trend toward purchasing higher-priced wines or choosing wines with a lighter/better-for-you profile.
“This trend provides significant opportunities, particularly with our Napa Valley portfolio, and also creates a platform for fostering innovation in the betterment space.”
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The launch of environmentally friendly low-alcohol wines using the traditional French piquette method under Illuminate by Kim Crawford, along with the introduction of Robert Mondavi’s Private Selection tiers and a decadent buttery chardonnay, offer a distinct taste experience.
These are just two examples of how these innovative products have positively influenced the local wine market over the past 12 months, setting new trends and standards.
According to Cheadle, Constellation Brands’ next frontier is to introduce Australians and New Zealanders to the joys of American fine wines.
“Less than two percent of the wine consumed in New Zealand and Australia is American. We own some really prestigious brands in the United States – Robert Mondavi, Mount Veeder, To Kalon Vineyard Company – which retail between US$32 and US$1,650 per bottle in Australia,” he notes.
“In the past 12 months, we’ve launched our fine wine strategy for New Zealand and Australia, and we’re having launch events across both countries to get American fine wine on the map.”
Raising Spirits
The liquor giant is also breaking into the Australian and New Zealand markets with its impressive American spirits portfolio.
“One of our key items is a Utah-based whiskey company called High West and it’s been going nuts in Australia,” Cheadle confirms. “Our master distiller, Brendan Coyle, recently travelled around NZA meeting key retail trade partners and the region’s best bartenders. Last year, High West won Dan Murphy’s North American ‘Whiskey of the Year’.”
“There’s a genuine shift happening and we have to constantly innovate.”
Some would say that Constellation Brands’ goal of doubling its fine wine and spirits business in the next three-to-five years is a lofty one within such established markets, but Cheadle believes Australians and New Zealanders are ready to level up.
“New Zealand and Australian fine wine is elegant and approachable, so we’re going to introduce our super-high-end VIP luxury wine experiences that people know well globally, but have not had the chance to enjoy over here yet,” he says.
“With our United States powerhouse behind us, we can leverage global insights to bring a new experience we know NZA consumers are ready for.”
Fast Facts
Constellation Brands dates back to 1945 when 21-year-old Marvin Sands purchased Canandaigua Industries in upstate New York. The company sold 757,000 liters of wine for a total of US$150,000 in its first year.
By 1961, Canandaigua Industries’ gross sales were US$8 million.
In 2013, Constellation Brands acquired an exclusive perpetual brand license to import, market and sell the Corona and Modelo beer brands in the United States.
In 2024, Constellation Brands has more than 100 brands in its portfolio and a market capitalization of US$45 billion.
