Issue link: http://winesandvines.uberflip.com/i/776679
Direct to Consumer G rowth in off-premise sales held steady at 3% in December 2016 versus the same month a year earlier, reports Chi- cago, Ill.-based market-research firm IRI. Sales for the month in IRI channels totaled $845 million, a robust finish to a strong year. IRI said 12-month sales through multiple- outlet and convenience stores for the period ending Dec. 25, 2016, topped $8.7 billion, a 5% increase from 2015. Chardonnay and Cabernet Sauvignon were the top off-premise buys, with $2 billion and $1.7 billion in annual sales, respectively. Spar- kling wines gained 8% versus 2015, with total sales of $996 million. Sauvignon Blanc made the biggest leap, rising 24% to $566 million. Pinot Noir rose 6% to become the sixth most-purchased variety, a step ahead of Merlot, which saw sales weaken 6% to $621 million. A strong economy in 2016 is generally cred- ited with Pinot Noir's rise, as consumers feel they can afford a slightly more expensive wine, especially one purchased off-premise. —Peter Mitham Off Premise Off-Premise Wine Sales Rise 3% D irect-to-consumer (DtC) shipments ended 2016 with robust growth, ris- ing 5% in December over December 2015. Data from Wines Vines Analytics/Ship- Compliant indicate annual sales rose 18% in 2016 versus a year earlier, extending the gains of previous years. Sales totaled $187 million in December 2016 and $2.3 billion for the year. December shipments typically moderate, but case volumes remained above average at 464,868 cases (the monthly average for 2016 was 418,279 cases). December volumes showed a 9% increase over December 2015— stronger growth than dollar sales. This reflects rising demand for lower priced bottles. A comparison of average bottle prices un- derscores the shift. While $60-plus bottles form the single largest segment of DtC activity, the average bottle price is $36.28, down 6% from 2015. The shift is tough to see month by month, with average bottle prices decreasing in just five out of 12 months, but the trend stands out in annual sales data. With annual case shipments rising 17% in 2016 to 5 million, the increased activity is clearly driven by cheaper wines, as reflected in lower average bottle price. Small and mid-sized wineries (those pro- ducing 1,000-49,999 cases) account for 74% of DtC shipments. Wineries producing 50,000 cases and up accounted for the remainder. —Peter Mitham Source: Wines Vines Analytics/ShipCompliant, 12 months ending December 2016. ANNUAL DTC SHIPMENTS 2012 2013 2014 2015 2016 $ Millions $2,500 $2,000 $1,500 $1,000 $500 0 OFF-PREMISE SALES BY VARIETAL Chardonnay Cabernet Sauvignon Sparkling Pinot Gris Red Blends Pinot Noir Merlot Sauvignon Blanc 0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 Millions n 2016 n 2015 n 2014 Source: , Wines & Vines Analytics. Domestic and imported wine sales through multiple-outlet and convenience stores; 52 weeks through Dec. 28, 2014; Dec. 27, 2015, and Dec. 25, 2016. METRICS February 2017 WINES&VINES 11 December DtC Shipments Strong; Grow 18% in 2016 ANNUAL OFF-PREMISE SALES $ Billions $10 $9 $8 $7 $6 $5 $4 $3 $2 $1 0 2012 2013 2014 2015 2016 Source: , Wines & Vines Analytics. Domestic table and sparkling wine sales in multiple-outlet and convenience stores; 52 weeks through December each year.