Issue link: http://winesandvines.uberflip.com/i/480754
what may be an evolving dichotomy in the wine market, where lower priced wines are flat or decreasing in sales, and higher priced wines are growing—sometimes dramatically. The latest IRI data show that dichotomy clearly in the accompanying graph of Off- Premise Growth by Price Segment (above right). This graph includes both domestic and imported table wines, but excludes sparkling, and covers 52 weeks. It's an issue of special interest to California grapegrowers and winer- ies, since California accounts for 73% of table wine sales in IRI's data. Every price segment from $8 and up per bottle experienced at least 7% sales growth, while the price segments below $8 lost sales. However, the bottle-price segment with the highest total sales in the stores measured by IRI was $5-$7.99 (see graph above left). It remains to be seen when and if the high growth rates for higher priced wines will change the balance of total sales between the segments. —Jim Gordon METRICS April 2015 WINES&VINES 11 Direct to Consumer DtC Shipments up 4% in February, 14% in 12 Months T he value of direct-to-consumer (DtC) ship- ments bounced back in February from the traditional January slump, growing 4% compared to the previous February. Volume in- creased by 11%, according to the Wines & Vines/ ShipCompliant Model. The 12-month growth rate was 13% by volume and 14% by value. February DtC sales totaled $132 million. For the third month in a row, the overall value of wines shipped direct to consumer during the most recent 12 months surpassed $1.8 billion. To offer some perspective, this was higher than winery revenues from U.S. wine exports, which totaled $1.49 billion in 2014, according to the Wine Institute. The average bottle price for DtC shipments was $36.87, a decrease of 6% from February 2014. The highest monthly bottle price during the previous 12 months was logged in November, when it reached $45.44. The lowest was in July, when it dipped to $29.57. July is also typically the slowest month in DtC volume. The highest monthly volume was recorded in October. Small wineries—those with annual produc- tion of 5,000-49,999 cases—took the largest market share in DtC shipment value during the 12 months ending in February. The value of their sales was $883 million, representing 48% of the total, and the volume was 1.8 million cases. Medium-size wineries—those producing 50,000-499,999 cases per year—were second (23% of all DtC sales), with $428 million in sales and 1.3 million cases. A close third were wineries Source: , Wines & Vines. Total table wine in glass packaging, 52 weeks through Feb. 22, 2015, multiple-outlet and convenience stores. Source: Wines Vines Analytics/ShipCompliant model. 12 months through February 2015. Bottle Price $ Billions 0 $.5 $1.0 $1.5 $2.0 $2.5 $3.0 OFF-PREMISE SALES BY PRICE SEGMENT $20+ $15-$19.99 $11-$14.99 $8-$10.99 $5-$7.99 <$5.00 Percentage Bottle Price -5% 0 5% 10% 15% 20% OFF-PREMISE GROWTH BY PRICE SEGMENT $20+ $15-$19.99 $11-$14.99 $8-$10.99 $5-$7.99 <$5.00 DTC SHIPMENT VALUE BY WINERY SIZE Very Small Medium Small TOTAL VALUE $1,823 million Limited Production Large DTC SHIPMENT VOLUME BY WINERY SIZE Medium TOTAL VOLUME 3,995,672 cases Small Limited Production Very Small Large producing between 1,000 and 4,999 cases, with $389 million and 21% of the market. Limited-production wineries making less than 1,000 cases per year and large wineries making more than 500,000 cases nearly tied as the smallest contributors to the DtC ship- ments pie. Limited-production wineries shipped $58 million worth of wine directly to consumers, while large wineries shipped $64 million in the DtC channel. The market-share pie in volume was slightly different. While small wineries claimed 45% for the biggest slice, medium-size wineries were not far behind with 32%. Large wineries also did slightly better in volume share than in value. —Jim Gordon Large 500,000+ cases Medium 50,000-499,999 cases Small 5,000-49,999 cases Very Small 1,000-4,999 cases Limited Production < 1,000 cases