10 years of premiumization — and all the damage that has been done

Higher prices are strangling wine to death, so that we may have lost a generation of wine drinkers

This is the first of two parts looking at premiumization’s grip on the wine business. Today, Part I: A decade of higher prices has chased away wine drinkers. Friday, Part II: Is ultra-premiumization the next logical – and terrifying – step?

More than once over the past decade, I’ve predicted the end of premiumization – and I’ve been wrong every time. Today, as we mark a decade (more or less) since premiumization took hold of the wine business, we can see the results.

It is strangling wine to death.

The numbers are as stark as they are depressing. The Wine Intelligence consultancy reports that in 2020, only 18 percent of those aged 18-34 in the U.S. were “regular” wine drinkers. That compares to 28 percent in 2010. In other words, wine may have lost an entire generation, if not more.

Meanwhile, the company that owns the Wine Spectator – and which never fails to gloss over what it doesn’t want to be true – has finally admitted that “the wine industry in the United States is expected to suffer a 0.5% volume decrease this year … volume growth has been modest at best in each of the past ten years due to fierce competition from whiskies, hard seltzer, and other ready to-drink brands.“

Yes, there are dozens of reasons why that’s the case. But, in the end, it’s difficult not to believe that price matters the most. People don’t buy something if it costs too much, and wine’s average price has increased by about one-half, from $6 or $7 a bottle in 2010 to close to $10 today.

We can argue all we want whether quality has improved by that much (and no, it hasn’t). But when you can buy a six-pack of decent beer for less than $10 or a more than adequate bottle of whiskey for $15, why pay $10 for supermarket plonk? Who pays $10 for a fast-food hamburger?

No one, and certainly not if they’re younger and have less money – and especially in today’s corporatized economy, when they have fewer prospects than their parents and grandparents did. So bring on the hard seltzer!

This is about the point, on the old blog, when people would send emails or leave comments telling me I knew nothing about wine, and that $20 or $30 or whatever was affordable and to shut up because you’re hurting wine and I’m canceling my free subscription.

Of course, if they were paying attention, they would have noticed that I was about the only one left who was drinking wine with them.

Photo: “CPR in J’bad” by Todd Huffman is licensed under CC BY 2.0