The answers are probably surprising to those of you who aren ?t regular visitors here. Syrah and shiraz? If you like those wines, you don ?t want to know. Sweet red wine? Do you even have to ask?
More, after the jump:
Tag Archives: wine sales
So long, Champagne, it’s been good to know you
The wine business continues to do things no one expects, and the latest Champagne sales numbers are a striking indication of what ?s going ?s on.
This French wine service story is stunning in its conclusions: ?Champagne was dominant 10 to 15 years ago, but the world has changed. ?
The story, though written for the European market, is well worth reading because it documents the trend we ?re been talking about here for several years (and not just because I ?m trying to put together The Cheap Wine Book). Today, when consumers have a choice between two quality products, they ?re more likely than ever to buy on price. Champagne exports declined 2.8 percent last year, while non-Champagne sparkling wine accounts for 70 percent of the European market.
In other words, we ?re buying more cava and prosecco and so are the Europeans — and that it ?s not Champagne doesn ?t seem to bother us.This is shocking news, and especially for the Europeans. Their market never, ever worked that way.
This also demonstrates the continuing evolution of the wine market into two tiers ? everyday wine drinkers, who are mostly ignored by the Winestream Media, and a much smaller, score-driven minority that still buys wine the old-fashioned way and is doted on by most of the wine world.
And how cheap are these wines? Cava costs ?8 (US$11) or less in most European retailers, while prosecco ranges from ?5 to ?15 (about US$7-$20). Those of you who buy either in the States will note that ?s pretty much what we pay for it. Call it the pricing power of the biggest multi-national wine companies (cava giant Freixenet ?s annual production is about two-thirds of the entire Champagne region), and they ?re more than willing to trade margin for market share ? another theme we ?ve discussed in detail here.
Holiday wine trends 2012
The one consistent from last year? Consumers are still looking for value, and they ?re still worried about prices. Or, as my pal Gil Kulers, who works for Atlanta ?s Tower Wine and Spirits, one of the largest retailers in the southeast, described it: ?If it ?s a choice between spending $1 more to get a better wine, and not spending the $1, I had a customer who didn ?t want to spend the $1. ?
The good news is that prices remain consumer-friendly, save for some higher end wines and Champagnes. In addition, the retailers I talked to said we ?re looking for value in places that we haven ?t necessarily looked for value in the past. The details are after the jump:
Is Amazon getting back into the wine business?
Amazon, the world’s largest on-line retailer, wants to insert itself into the wine direct shipping picture without actually shipping any wine.
The on-line retailer isn ?t commenting. But Wine Industry Insight and the Wall Street Journal reported last week that Amazon will allow some California wineries to participate in its third-party resellers program, in which Amazon lists the items for sale but doesn ?t actually sell them itself.
Needless to say, the wineries were agog at the opportunity to be part of Amazon, which is the fifth most visited website in the U.S. and does almost $13 billion a year. Lew Perdue at Wine Industry Insight wrote that he was contacted by ?numerous ? producers who wanted to know who to call at Amazon so they could sign up.
The legal experts I talked to were less enthusiastic. They asked not to be quoted by name, since they didn ?t know exactly how Amazon wanted to put the program together — though it is apparently based on a 2011 decision by California Alcoholic Beverage Control to allow this sort of thing.
But all agreed that the program could still encounter any number of problems, given the complexity of the three-tier system, which governs alcohol sales in the U.S.; the legal quagmire that is direct shipping law, with 50 laws for 50 states; and newly aggressive state regulators, who might be inclined to sue Amazon just because.
Said one high-profile liquor law attorney: ?It has a lot of moving parts and there are lots of semi-vague statutory commands buried in there, and so lots of problems to work through with even the best intentioned regulators. For those who just don ?t want it to work, there are lots of opportunities to provoke expensive and time consuming litigation. ?
Which, of course, was the reason Amazon got out of the wine business in 2009, after a mostly failed test program that showed just how complicated direct shipping was. Why the company decided to do it again, given those difficulties, could be even more interesting than actually doing it.
Drawing courtesy Appellation America, using a Creative Commons license
The Coppola alicante bouschet mystery solved
A tip o ? the Wine Curmudgeon ?s fedora to two of the blog ?s regular readers, Rich Liebman and Denise T., who emailed me with the solution to Friday ?s Coppola alicante bouschet mystery. World Market was selling the new vintage of the wine for $9 over the weekend, and sent an email telling its customers about the sale.
Apparently, people who received the email did a Google search and came up with my four-year-old review, and the blog numbers over the weekend took an appropriate upward tick. For which I am most grateful, since late summer weekends are usually pretty slow. Hopefully, the review helped the new visitors make up their mind about whether to buy the wine (and that they’ll come back more often).
In this, it speaks to one of my favorite subjects ? how Americans buy wine. The alicante was a $9 wine from a well-known producer that was being sold by a trusted retailer, but that didn ?t stop people from searching for a review. They couldn ?t decide to buy it without a third-party opinion, and if I ?m a boss at Coppola or World Market, that would worry me. If my brand isn ?t enough to sell a cheap wine, something may be wrong with my brand.
In fact, the alicante in the ad is the 2008 vintage ($9, purchased),and it’s starting to show its age. Much of the fruit is gone, and what’s left is dark and plummy, with a bit of a sour edge. But, given when it was made, that’s not surprising. The other thing this demonstrates is that Americans, faced with a wine that isn ?t cabernet sauvignon, merlot, or chardonnay, get confused. And we have the wine business, with its unending commitment to consumer education, to thank for that.
Sweet red wine by the numbers
Sweet red wine continues to burrow its way into the consciousness of the U.S. wine drinker, according to two recent reports that looked at sales data. I ?m still not sure anyone knows exactly what this means, but I am willing to guess that it has a lot of people in the wine business dazed and confused.
The latest numbers from the SymphonyIRI Group, considered one of the two most important companies that track wine sales, notes that Apothic is the 10th biggest table wine brand in the $8-$10.99 range. It saw sales grow 129 percent in the 52 weeks ending July 8, totaling $31.3 million. Why is this so significant? Because Apothic, for all practical purposes, sells just one wine ? a sweet red. In this, consumers bought more Apothic over the last year than they did Smoking Loon and Columbia Crest, more typical brands that offer the usual range of varietals and that were 12th and 13th in the report.
Or, to look at it another way, Apothic, owned by E&J Gallo, sold some 300,000 cases of wine over that 52 week period. That ?s almost one-half of one percent of all of Gallo ?s volume ? not bad for a brand that ?s just a couple of years old in a category that has traditionally been ignored by the wine business. How much back slapping and high fiving do you think went on at Gallo headquarters when those numbers came out?
The other study was released by Technomics, best known as the leading restaurant consultancy in the country (and that it is doing wine reports says something about how important wine is becoming). Technomics tracked the top 250 wine and wine-like brands, and discovered that Apothic was the fastest growing brand in 2011, up 566.7 percent from 2010. That ?s even better than the top premixed cocktail brand, and premixed cocktails are currently all the rage among the liquor trade cognoscenti.
One caveat: If you click on the links, you ?ll notice that Technomics and SymphonyIRI report different sales numbers for the same product, which is something that those of us who pay attention to these things have learned to accept. Counting the number of cases of wine sold is not an exact science.
What makes these numbers even more significant is that they ?re only a hint of what ?s going on. Most wine companies are privately owned, so sales figures are closely held. We don ?t know how well sweet reds from other brands did, since they ?re just one wine among several and studies like these don’t differentiate between different wines from the same company.
Cupcake Vineyards, for example, was No. 2 in the SymphonyIRI report and fourth in the Technomics. Most of Cupcake ?s wines are best-sellers, but I ?d love to see how much of that growth came from its Red Velvet, a sweet red that is only a year or two old. If it sold anywhere close to what the Cupcake chardonnay or pinot grigio did, we are truly in a different world than most of us think.
How people really buy wine
The wine business ? and especially wine writing ? is dominated by the idea that consumers buy wine based on scores, reviews, and the good taste that those in charge share with the masses.
Which, of course, is so far from the truth that I ?m surprised anyone still believes it. Or, as I saw last week at a World Market in Dallas (and yes, the Wine Curmudgeon was chuckling as he watched):
20-something woman: ?I need to buy some wine for a party. ?
Store employee: ?We have this wonderful pinot noir, great scores, won a gold medal. ?
20-something woman: ?Do you have something that costs $8 a bottle
One more time, for those of you not paying attention ?- only 60 percent of Americans drink wine. Of those of us who do drink wine, 20 percent of us account for 9 out of every 10 bottles sold. And we ain ?t drinking first growths, as anyone who has bothered to look at sales studies would know.
Which means there are more consumers like that 20-something woman out there than many of us want to admit.