Dr. Liz Thach, MW

Overview of the US Wine Industry in 2018: Stable Growth Forecasted – Based on 2017 Stats

Many of the statistics for 2017 US wine sales are in and the results show steady growth, but with increasing competition from imports and other beverages. The outlook is still positive because it is expected that 2018 will continue to see steady growth pattern of previous years, at around a 2% increase in US wine sales value. According to Wines & Vines and BW166 (2018), total US wine sales were $62.7 billion in 2017, with $41.8 billion in sales from domestic wine and $20.9 billion from imports.

Positive Revenue Stats for US Wine Industry in 2017

2017 US Domestic Wine Vs. Imports by Volume

25th Year of Volume Growth: 2017 is the 25th consecutive year of growth for US wine sales, though a bit slower in 2017 than previous years. 2017 volume was 1.3% compared to 2.6% in 2016 (Brager, Nielsen, 2019).

Activity in Major Wine Sales Channels

Off-Premise – estimated at 78% of US market with an average bottle price of $10. According to Nielsen (2018) volume grew at double digits in the $15-$19.99 price segment this year with negative growth below $8 per bottle. Despite this, 55% of wine sold in the US is still under $8 per bottle, not including boxed wine. There are nearly 192,000 off premise wine retailers in the US market.

On-Premise = estimated at 20% of the US market with an average bottle price of $40, on-premise volume was up 1.3% and sales 1.9% as of October 2017, but still very competitive with spirits. There is some concern that too many new restaurants and bars have been established, with the current number of on-premise establishments around 373,000. (Wine Industry Insight and Nielsen, 2017, 2018).

Winery Direct to Consumer (DTC) = though still only less than 2% of the total US market in terms of volume, DTC sales continue to increase with 5.78 million cases shipped in 2017, estimated at $2.7 billion, an increase of 15.5% higher in value than 2016 (Sovos and ShipCompliant, 2018) – despite wildfires in California (SSU, 2018).

Note: Online wine sales in the US are now estimated at around 4% total volume, primarily from DTC sales and online retailer websites. The estimated total volume of global online wine sales in 2016 was 5% at $9.8 billion (Kedge, 2017)

 

Number of US Wineries and Export Figures

 

US Remains Largest Wine Consuming Nation by Volume & Value

 Hot Varietals and Trends Now and for 2018

The Five Most Popular Wine Varietals/Styles by revenue remain the same as in 2016: 1) chardonnay, 2) cabernet sauvignon, 3) red blends, 4) pinot grigio, and 5) pinot noir (WBM and Nielsen, 2018). This is expected to continue in 2018, but chardonnay has fallen to .9% growth, with predictions that cabernet sauvignon could overtake it as most popular varietal in the next year or two.

Fastest Growth Wine Categories continue to be Rose, Sparkling and Sauvignon Blanc – with Rose in the lead with a 59% increase in value from the previous year! Top selling Rose by country is France at 51% of the market, followed by the US at 37% and Italy at 5%. The largest Rose category by price point is the $11 – $15 bottle at 31% of the rose category (Brager, Nielsen, 2018).

Fastest Wine Growth by Country/Region is Oregon in first place, up over 15% in both volume and value. This is followed by France and New Zealand – both growing at double digits (Brager, Nielsen, 2018).

New Packaging – innovation in packaging seems to be well-accepted by Americans, with 49% growth rate of wine in cans, 37% wine on tap, 18.5% tetra-pak, 15.2% box, and 7.5% plastic. Considering that most of these containers –with the exception of boxed wine – are relatively new to the US market in the past few years (though available in other countries for decades), this is pretty amazing (Brager, Nielsen, 2018).

New Places to Drink/Buy Wine – another interesting trend is that wine is now available in more new locations in America. Off-premise it is now being sold in more natural/gourmet grocers (up 5.5%) and limited assortment grocers (up 8.1%). On-premise there is more wine available in theaters, sports stadiums, sports and up-scale premium bars, and fast casual restaurants. (Brager, Nielsen, 2018).

Top 5 Largest Wineries and Distributors by Volume in America 

Top 5 Top Selling US Wine Brands by Volume 

1)      Franzia
2)      Barefoot
3)      Robert Mondavi
4)      Sutter Home
5)      Carlo Rossi   

(Shanken, 2017)

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