Issue link: http://winesandvines.uberflip.com/i/131907
METRICS Wine Consumers Trade Up at Retail Value of domestic wine grows 6% while volume is flat R etail sales of domestic table wine grew 6% through April 21 this year, generating $87 million more than during the same period in 2012. The numbers reflect a continuing, long-term expansion of the off-premise wine market as measured by market research firm IRI. The expansion reflects only a slight increase in volume—0.6% so far this year— meaning that consumers are not buying more bottles but rather adding more expensive bottles to their shopping carts. "With the dollars being up, with the economy doing well, it shows that a lot of people are trading up," said Curtis Mann, IRI director of wine and spirits insights. "Definitely, the industry is very healthy right now. New folks entering the wine category are entering at the $8 to $11 level, and once they enter, they are not trading down as much as they did threefour years ago. That's a pretty big step for American wine consumers to enter at that price level and stay there." The highest rates of growth by price segment continue to be the most expensive. Domestic wines from $11 to $14.99 per bottle grew more than 10% so far this year; those from $15 to $19.99 increased 5%, and wines priced at $20 or more ballooned by 19%. Sales of premium boxed wines also grew by 19%. These categories are not as big in sales as the $5-$7.99 segment, but they now account for bigger slices of the pie than two years ago, and their success is lifting the overall business, Mann observed. He said it's not the case that many brands have raised their prices but that wineries have introduced new brands at higher price points, and consumers have stepped up to them. "Looking at the major brands and the long-term price situation, nobody has taken any significant price increases," Mann said, though a few have tried and then retreated. "It's a concern for the wine industry. People won't pay more for the same brand they've already been purchasing. They have more disposable income, and they are moving into $20-plus, but not buying more wine. Essentially they are driving the price mix up, but pricing is not increasing." —Jim Gordon Long-Term Growth of Off-Premise Sales $ Millions $500 $400 $300 $200 Source: IDL_Dir11 Jun 07 Dec 07 , Wines & Vines 11/18/10 4:21 PM Iván D. Lessner Jun 08 Dec 08 Jun 09 Dec 09 Jun 10 Dec 10 Jun 11 Dec 11 Jun 12 Dec 12 Off-premise sales of domestic table wine at major U.S. food and drug stores. Page 1 IDL Process Solutions Inc. Process & Product Development Alcoholic & Non Alcoholic Beverage Industry Equipment Sales ■ R. WAGNER: Rapid SO2, TA ■ ERBSLOEH: Fining & Treatment Agents, Yeasts, Enzymes, CelluFluxx (D.E. Replacement) ■ TRUST: Quality Hungarian Oak Barrels & Chips ■ EMD: Reflectoquant Analyzer & Kits 1164 Lee Street, White Rock, B.C. V4B 4P4 Canada Phone: (604) 538-2713 Fax: (604) 538-4517 www.idlconsulting.com Clean • Sterilize • Humidify "We can do it all" ... • Bottling Lines • Barrels • Tanks • Floors and Walls • Winery Equipment • Vineyard Equipment Built by • Sterilize bottling lines • Clean stainless steel tanks • Clean and maintain barrels • Sanitize floors and walls • Steam clean equipment We'll get you all steamed up. ARS/Pressure Washer Company We work well under pressure. We work well under pressure. 800-735-9277 or www.cleanwinery.com Win es & V i n es JU NE 20 13 11