Fewer folks popping bottle tops as champagne sales fizzle

— -- There will be little celebration for champagne makers this year.

After last year's strong 4% sales gain, the biggest since the buying frenzy in 1999 to ring in the new millennium, champagne makers are feeling the impact of the sour economy from $5 sparkling wines to $100 bottles of champagne.

"I don't have a bright outlook for champagne this year," says Frank Walters, research director for Impact, which expects the category to be down 1% to 4%, from about 900 million glasses sold in 2007.

"Luxury items are getting hurt, people are looking for value, restaurants are getting clobbered and with unemployment rising, people are watching their shekels."

Other factors stealing the fizz:

•Consumer spending. Scaled back spending hurts champagne hard. The segment racks up 60% of sales from late October to January.

•Shorter season. An early Thanksgiving gave champagne makers five fewer days than last year to get products into stores.

•Image problem. Many domestic sparkling wines are called champagnes even though the grapes don't originate from the Champagne region of France. Trade group Champagne, U.S.A, began an advertising campaign "Unmask the truth" in November to call attention to those products that are not officially champagnes.

Still, champagne and wine makers and retailers are trying to spur buying.

"Grocery stores are lowering prices almost to cost to get people in to buy," says Gary Heck, president, Korbel Champagne Cellars. "Most stuff is down by $2 to $3 across the board."

Marketers for Martini & Rossi Asti Spumante, which sells for $10 to $13 a bottle, are focusing on store shelves. "We want to make sure our brand is there for consumers to see when they shop," says Celio Romanach, Martini & Rossi's brand managing director.

Luxury brands are trying to reach the still-rich with super-expensive products. Moët & Hennessy bundled its bubbly with high-end gift boxes and packages including a Dom Pérignon Power Trio, a boxed set of three Dom Pérignon vintages with a price tag of $1,500.