Wines & Vines

July 2015 Technology Issue

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Merlot in off-premise sales in 2013 to become the third-largest varietal wine category in value after No. 1 Chardonnay and No. 2 Cabernet Sauvignon. Its rapid growth has continued. The 52-week growth rate for the varietal was 9%, including both domestic and imported brands. The varietal's total sales were $848.1 mil- lion in IRI's data from multiple-outlet and con- venience stores, which include supermarkets, drugstores, mass-market retailers, gas/conve- nience stores, military commissaries and select club and dollar retail chains. While not growing at as fast a rate as Sau- vignon Blanc (14%) or red blends (13%), Pinot Gris has a much larger base. The accompanying bar charts show that the $5-$7.99 price seg- ment is the largest in sales for the varietal, and that it accounts for more than half of the rev- enue in IRI's data. However, the fastest-grow- ing segment for Pinot Gris is $11-$14.99, where it gained 35% more dollars than in the previous 52 weeks. Other winners in terms of growth by vari- etal include Pinot Noir, which grew by 9% during 52 weeks, Cabernet Sauvignon by 8% and the leader Chardonnay, which grew by 3%. The latest data show that Merlot sales de- creased by 4%, Syrah/Shiraz by 13% and white Zinfandel by 7%. All the figures above are based on sales in terms of dollars, but the picture looks less rosy in terms of volume. Domestic wine grew just 3% in terms of 9-liter cases, according to IRI, and imports shrank in case volume by almost half a percentage point. Pinot Gris from all sources increased by 15% in case volume. —Jim Gordon METRICS July 2015 WINES&VINES 11 OFF-PREMISE PINOT GRIS GROWTH RATE BY PRICE SEGMENT OFF-PREMISE PINOT GRIS SALES BY PRICE SEGMENT Source: , Wines & Vines. All table wine in glass packaging, 52 weeks through May 17, 2015, multiple-outlet and convenience stores. Percentage 0 5% 10% 15% 20% 25% 30% 35% Source: , Wines & Vines. All table wine in glass packaging, 52 weeks through May 17, 2015, multiple-outlet and convenience stores. $ Million Bottle Price 0 $100 $200 $300 $400 $20+ $15-$19.99 $11-$14.99 $8-$10.99 $5-$7.99 $3.50-$4.99 <$3.49 T he regular summer swoon for direct-to-consumer shipments is well under way, but May's numbers are still higher than the previous year. DtC shipments rose 4% compared to May 2014, and the 12-month total also increased 14% to $1.9 billion. May's shipments totaled $141 million in value, which is about $6 million more than May 2014 and 17% more than the total in May 2012. The total cases shipped in May grew 3% over the previous year to 347,440. Total shipments have been higher in every month of 2015 compared to last year, and the five-month total is 1.7 mil- lion, 10% more than 2014. By value, 2015 DtC shipments are also up overall compared to 2014. The year-to-date total for 2015 is $784 million, about 11% more than at the same point last year. This month, Wines Vines Ana- lytics focused on Napa County for additional metrics analysis. DtC shipments from Napa County in the past 12 months totaled $948 million. Cabernet Sauvignon ac- counted for 48% (or $174 mil- lion) of total shipments, followed by shipments of red blends, which made up $164 million (or 17%) of the total. Sauvignon/ Fumé Blanc had the largest share of the "others" category with $25.2 million, which just beat out Zinfandel's $25 million. —Andrew Adams Direct to Consumer DtC Shipments Increase in Value, Volume Bottle Price $20+ $15-$19.99 $11-$14.99 $8-$10.99 $5-$7.99 $3.50-$4.99 <$3.49 Source: Wines Vines Analytics/ShipCompliant model. 12 months through May 2015. DTC SHIPMENTS FROM NAPA COUNTY WINERIES Red Blends Chardonnay Merlot All Others Pinot Noir Cabernet Sauvignon Total shipments have been higher in every month of 2015 compared to last year. DIRECT-T0-CONSUMER SHIPMENT VOLUME Cases (Thousands) 600 500 400 300 200 100 Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Source: Wines Vines Analytics/ShipCompliant 2015 2014 2013 2014

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