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METRICS Wine's Biggest Winners and Losers Retail sales show red blends and Sauvignon Blanc way up, Syrah way down S an Rafael, Calif.—California and Washington wines drove the dramat- ic 26% retail growth this year for red table wines blended from diverse va- rieties. A handful of relatively new brands that blend the traditional Bordeaux varietals and/or mix Zinfandel, Syrah and others have caught the imagination of shoppers at major food and drug stores. Ménage à Trois, Apothic, Cupcake and 14 Hands led the Meritage/red blends category, according to the Symphony IRI Group, a Chicago, Ill.-based market re- search firm. "This category just continues to be the place to be," said Curtis Mann, SIG's director of client insights for wine. Mann explained that the fast-growing red blends reflect a change in the way consumers choose wine, going beyond a preference by varietal or place of origin. "The market structure in wine is usually 'flavor comes first,' so this is really a new approach," he said. "Now the attitude is, 'I am less worried about the flavor, but more that I drink that brand.' The brand has kind of flipped the hierarchy." Red blend/Meritage wines have sold $200 million this year through Sept. 9 in the stores that SIG analyzes. Scanning the most recent SIG data for the varietals with the fastest rates of change in sales, Wines & Vines found other big winners and losers. New Zealand Sauvignon Blanc The next hottest varietal was Fumé/Sauvi- gnon Blanc with $176 million in sales and Table Wine Sales by Package Type MILLIONS ($) 187ml glass bottle 500ml pouch 750ml glass bottle 1.5L glass bottle 3L glass bottle 3L box 4L glass bottle 5L box 83 23 2,890 809 45 105 42 197 CHANGE 13% 35% 6% -1% -10% 17% -7% 2% Major U.S. food and drug stores, year to date. Winners and Losers by Wine Varietal -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 30% 26% 14% 7% Red Blends/ Meritage Sauvignon Blanc Fumé/ Cabernet Sauvignon -16% -5% Merlot Syrah/Shiraz Change in sales, major U.S. food and drug stores, year to date. a 14% growth rate. New Zealand led this group, as its sales alone grew 29% and lifted the whole category. "New Zealand Sauvignon Blanc has been doing well for a really long time," Mann said, "but now it's on fire." The average price is a relatively high $11. California Sauvignon Blanc also has per- formed well in price ranges from $11 up. Cabernet Sauvignon is a much big- ger seller with $507 million—and it still grew by 7%, despite the inherent difficul- ty in achieving a fast growth rate from a big base. "That story is about premium, premium, premium. Cabernet is up more than 27% in the $20-plus category," Mann said. Syrah/Shiraz shrinks 16% Then there is Syrah. The category of Syrah/Shiraz was the biggest loser by per- centage of sales, dropping by 16% to $58 million. Australian Shiraz has declined along with domestic Syrah at most price points. Even powerhouse Yellow Tail shrank in Shiraz sales, while still doing well with its other varietals. One common criticism of Syrah is that wine styles vary so widely that consum- ers don't know what to expect when they buy a bottle. Another is that the U.S. hasn't developed a marquee winery to wave the flag for the varietal. "There's no Opus One of Syrah," Mann observed, "so I think it's more of a marketing problem than anything." One bright spot, however, was that Cali- fornia and Washington Syrah in SIG's high- est price segment, $20-plus, did grow well. Package types evolve Varietals and flavors were not the only elements that helped wines succeed this year by breaking with tradition. Consum- ers appeared happy to place different sizes and types of wine packages in their shop- ping carts, too. Sales of airline-sized 187ml packages increased twice as fast as the standard 750s, and 500ml pouches really caught on, growing by 35% from a small base as consumers embraced them for their light weight, unbreakability and convenience. The 3-liter box or bag-in-box also grew much faster than the norm and broke $100 million in sales this year to date. In contrast, the large formats in glass (including 1.5-, 3- and 4-liter bottles), all shrank in sales. Wines in traditional 750ml bottles still dominated all other formats, however, and grew by a respect- able 6%. Domestic wines up 7% U.S. table wines of all types kept their 7% growth trajectory with $5 billon in sales during 52 weeks, and tallied 3% growth in volume. The average case price grew by $2.36 to $69.66. Domestic wines ac- counted for 79% of sales, and California claimed 72%. —Jim Gordon WINES & VINES NOVEMBER 2012 11 -4% Riesling