The death of $10 wine, according to the wine pundits, is just around the corner. That corner, though, looks to be in a completely different part of town.
How else to make sense of U.S. sales figures for the 52 weeks ending Jan. 24, where 19 of the top 20 selling brands cost less than $10? And that eight of the top 20, all selling for less than $10, showed double digit sales growth in a market has been essentially flat for the past three years?
In this, what is happening with wine sales shows again the divide that has developed between the top end of the market and the wine that most of us drink. The Winestream Media and the analysts can talk all they want about the growth of wine that costs $15 or more, but that they continue to ignore what’s happening at $10 speaks to their wishful thinking. Barefoot, at $5.59 a bottle, is the best-selling wine in the country, selling almost 10 million cases last year, according to these sales figures. That would make it the seventh biggest winery in the U.S. if it wasn’t part of E&J Gallo; how can analysts continually dismiss this as the exception that proves the rule?
Also big sellers: Black Box, the boxed wine that is the equivalent of four bottles, up 18 percent at $5.01 a bottle; my beloved Bogle, up 14 percent at $9.49 a bottle; and 14 Hands, up 14 percent at $9.79 a bottle.
So why the $10 wine blind spot?
? Too many wine writers are snobs about cheap wine, and look for sales data that supports their bias. So if sales at $15 and more are growing more quickly, even if it’s from a smaller base that was depressed during the recession, it’s evidence that the stuff they think is beneath them is going away.
? Let’s hop on the Millennial bandwagon, because they are going to spend more money on wine than their parents did. This is about as wishful as it gets, as Rob McMillan at Silicon Valley Bank has shown, but it still gets recited as gospel.
? These are grocery store wines, and grocery store wines don’t count. Would I buy most of the wines on the top 20 list? No, but that doesn’t mean there isn’t quality for the price, including Bogle, 14 Hands, and Chateau Ste. Michelle.
Yes, wine that costs $5 and less is seeing sales declines, some significant, but this has less to do with price than with demographics. The audience for those wines is aging and doesn’t buy as much as it used to, in the same way the big beer brands are seeing significant sales declines as their audience drinks less. My guess is that the Millennials are buying Black Box instead of their elders’ Franzia, and it’s probably not a coincidence that a craft beer costs about as much as a Black Box bottle. But who in wine wants to believe that?
More about wine sales trends:
? Big wine growth 2016
? Is the U.S. wine boom over?
? Wine prices in 2016