By Denise Purcell

research spotlight

Value-priced imports and premium domestics are just a few of the factors driving sales in the wine category.

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The U.S. wine industry’s efforts to make wine less intimidating and more of an everyday drink have paid off with greater consumption, says Mintel International. Total wine sales reached $32.5 billion in 2008, a 20 percent jump since 2003 in inflation-adjusted figures. The way Americans think about wine has changed; there is growing interest in value-priced fun brands and curiosity about New World wines.

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THE MARKET

Key Points
• Domestic premium wines are helping drive category growth because they’re considered by many an affordable luxury in a tough economic climate.
• Volume sales of domestic wine lag behind imported wines that are offering both value pricing and fun, accessible brands such as France’s French Rabbit or Australia’s Yellow Tail.
• Recent innovations have focused on packaging designed to be more eco-friendly and/or to keep wine fresh longer (turn to p. 104 to read more).
• Other trends include organic/green wines and celebrity wines such as those from Martha Stewart, actress Lorraine Bracco and the late Paul Newman.


Wine sales topped $32.5 billion in 2008. Growth was driven by an increase in the frequency of drinking imported wine, which grew 11 percent from 2003 - 2008. Domestic wine drinking frequency increased 2 percent during the same time period. Strong sales of domestic premium wines—considered by many an affordable luxury—also drove growth. These wines accounted for nearly one-third of retail table wines sales in 2007. 


Imported wine’s volume growth was driven by the introduction of value-priced brands like Yellow Tail that attracted a new group of consumers and kicked off a wave of other user-friendly brands like Little Penguin, Monkey Bay and Funky Llama. Growing consumer interest in New World wines has also given a boost to import sales. Volume sales of domestic wines are up due to increasing availability at Wal-Mart, the nation’s largest retailer, as well as in convenience stores.

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THE CONSUMER

Key Points
• Nine out of ten wine drinkers agree that “good wine doesn’t have to be expensive.”
• New World wines are of increasing interest to younger consumers such as adults aged 25 - 34.
• High consumer awareness of wine’s health benefits has boosted sales. Nearly nine out of ten wine drinkers surveyed believe that drinking wine in moderation is good for overall health. Positive health associations are stronger for red wine (83 percent) than white (41 percent).
• For everyday wine, respondents pay an average of $13.50 per bottle. For special occasions, respondents will spend an average of $24.30.


Table Wine Consumption by Key Demographics, February 2007–March 2008

Wine consumption tends to increase with age, especially with domestic wine. Consumers ages 25 - 34 are likely trying imported New World varieties, or those from emerging, wine-producing countries like Argentina. Zinfandel, Merlot, Chardonnay and Cabernet comprise the “big four” in the domestic wine category. Table wine consumption is higher among women (38 percent) than men (32 percent), who generally prefer beer over wine. Wine consumption is highest in the Northeast followed by the West.



Attitudes Towards Fun Names and Packaging Types by Age, August 2008
Base: 866 internet users aged 21+ who drank wine in the past three months
SOURCE: Mintel

Younger consumers, especially ages 25 - 34, are more open to trying new types of wine, including New World varieties with clever names and eco-friendly packaging like Tetra Paks and screwcap bottles. Marketing to this group requires a shift for winemakers, who’ll need to use tactics beyond television and print to reach an increasingly online population.

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Editor’s Note:
Specialty Food Magazine is pleased to be working with Mintel on Research Spotlight. Mintel is a leading supplier of competitive media, product and consumer data. A 33-year reputation for delivering dependable and original market information has allowed Mintel to maintain Business Superbrand status in the U.K. Mintel’s product line includes: Mintel Reports, a renowned market intelligence report series, publishing more than 600 reports annually covering the U.S. and Europe; and Mintel’s GNPD, the Global New Products Database, which monitors worldwide product innovation in consumer packaged goods markets. For more information call 312.943.5250 or visit www.mintel.com. NASFT members may purchase Mintel’s wine report at a 10 percent discount.

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