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The trends appear to debunk a myth used by wholesalers EDIT OR' S LET TER vember, and it appeared that the 2010 total would reach a sig- nificantly higher level overall than 2009. (See our new Wine Industry Data Center section on page 12 for more details.) DtC shipments brought wineries T $178 million in November alone, according to the Wines & Vines/ ShipCompliant Shipment Model. Most DtC shipments carry a high price tag per bottle—an average of $59 for Cabernet Sauvignon and $32 for Chardonnay—and we all know that the margins tend to be very favorable for direct sales. High sales and high prices add up to great cash flow in this channel for winer- ies that use it. Teen drinking at historical low Meanwhile, alcohol use among teenagers continued its long-term decline, according to results of the "Monitoring the Future" survey conducted by the University of Michigan for the National Institute on Drug Abuse. Drinking by teens, particularly instances of heavy drinking, reached historically low levels in 2010. The survey tracks teens' consump- Drinking by teens, and particularly instances of heavy drinking, reached historically low levels in 2010. tion of various drugs, alcohol and tobacco. It covers eighth graders, 10th graders and 12th graders. For 12th graders, 2010 saw the lowest level of alcohol consump- tion since the study began in 1975. For the younger two groups, it was the lowest use of alcohol since they were first included in the study in 1991. The survey authors note that since 1991 the number of teens who say they consumed alcohol within the past 30 days has fallen by about half among eighth graders, close to one-third among 10th graders and nearly one-quarter among 12th graders. I would argue that the rates are still uncomfortably high—27% of teens reported drinking alcohol within the past 30 days—and that wineries should continue to discourage teen alcohol con- sumption as much as possible. However, the survey results are generally quite good news for teens, parents and alcohol producers. Wine producers in particu- lar have a very positive message to convey about the healthful effects of moderate wine consumption. That the decline in teen 10 Wines & Vines JAnUARY 2011 QSEE US AT UNIFIED, BOOTH #1004g he news in December leading up to press time for this issue carried very positive stories for wineries: An im- portant segment of wine sales is up while teen drinking is down. Is there a connection? Direct-to-consumer (DtC) shipments from U.S. wineries rose a staggering 26% in value during No- DtC Sales Up, Teen Drinking Down alcohol consumption continues during an era of higher wine sales is especially remarkable. Is there a connection? The University of Michigan did not break down the teens' alco- hol consumption by wine, beer and spirits categories, so tying wine sales to decreased teen drinking is difficult. But the teen drinking survey does help debunk at least one myth in the ongoing battle to expand DtC shipping to all 50 states. The main opponents of inter- state DtC wine shipments are wine wholesalers. They have fought tooth and nail for three decades to main- tain their control of wine sales, and they continued to do so in Con- gress during 2010 with HR 5034. They have long used teen drinking as a trumped up reason to prevent direct shipping. In a recent post on Fermentation: The Wine Blog, Tom Wark writes that the decline in teen drinking during a time of increased DtC shipping pulls the rug out from under this wholesaler argument. Wholesalers have succeeded in barring or delaying DtC shipments into their states by saying, among other things, that only they can pro- tect the youths of those states from alcohol. Direct shipments could go illegally to teenagers, they warn, while sales at in-state retailers and restaurants (who buy from the wholesalers) are safer. This always sounded dubious, and the new sur- vey seems to confirm how specious an argument it is. The main reason is that the shipping companies can't leave packages of wine at an address without getting an adult signa- ture. I can personally attest to the tenacity of UPS and FedEx in this regard, as someone who receives wine shipments at home in California and is the parent of two teens. The survey also asked teens about their ease in obtaining alco- hol. All three age groups reported an availability level lower than ever recorded. With teen consumption down and availability more difficult at the same time that DtC shipments are up, the correlations look good for direct shippers and bad for the wholesalers' lob- bying efforts. Here's to even more good news in 2011 for win- ery-direct sales!