Tag Archives: wine consumption

Ask the WC 15: Wine consumption, wine refrigerators, wine tastings

wine consumptionThis edition of Ask the WC: European wine consumption, and why they’re drinking less; plus, wine refrigerators and how much wine the WC tastes a year.

Because the customers always have questions, and the Wine Curmudgeon has answers in this irregular feature. You can Ask the Wine Curmudgeon a wine-related question .

Hi, WC:
You recently wrote that “European producers keep pulling out vines in the wake of reduced wine consumption in France, Spain, and Italy.” Why is that? Why are they drinking less?
Surprised

Dear Surprised:
European wine consumption has been steadily declining for years, thanks to stricter drunk driving laws, the aging of the population, and younger drinkers turning away from wine. Sound familiar? Having said that, Europeans still drink more wine per capita than we do — about one bottle a month for Americans compared to four bottles per person in France.

Oh Cheap Wine One:
I’m thinking about buying a wine refrigerator. Do I need one?
Chilling out

Dear Chilling:
Probably not, unless you’re buying wine that needs to age. And most wine doesn’t. The usual figure is that 90 percent of the wine in the world is made to drink within a couple of years of its vintage. In which case, use the fridge — take a cold white wine out about 20 minutes before you want to drink it, and chill a red for 20 or 30 minutes before opening.

Hello, Wine Curmudgeon:
You must write hundreds of wine reviews a year. Do you really taste that much wine? How much do you taste a year?
Curious

Dear Curious:
I write about 200 reviews of some sort on the blog each year (which doesn’t include reviews and the like for my freelance work). All told, I probably taste a couple of thousand wines a year between trade tastings, competitions, and drinking at home. It’s like my pal Dave McINtyre says: “It’s not so much that my palate is better is yoursd. I just drink a lot more wine than you do.”

More Ask the Wine Curmudgeon:
Ask the WC 14: The wine availability edition
Ask the WC 13: California chardonnay, grip, affordable wine
Ask the WC 12: $5 wine, varietal character, negative reviews

Are Americans turning away from wine?

wine preferenceThe number of of us who prefer wine over beer and spirits is at a 14-year low

Unwelcome news for those of us who care about wine: The number of Americans who say they prefer wine over beer and spirits is at a 14-year low.

A July Gallup poll found that 40 percent of us who drink alcohol prefer beer, while 30 percent prefer wine and 26 percent like spirits best. The 30 percent figure is the lowest since 2003, and approaches the historical lows of the 1990s. The trend has continued downward since its peak of 39 percent in 2005, when wine passed beer as the most popular alcoholic beverage in the U.S.

So what’s causing this?

Premiumization, in which we’re paying more for wine that isn’t especially better. Higher prices almost always have something to do with how we decide what we buy. The downward trend, which started in 2009, almost exactly coincides with premiumization.

The decline in restaurant wine sales, again thanks to higher prices. Those of us who might have a glass or two when we eat out may have given that up to save money.

• The craft beer movement, as well Big Beer’s panic-fueled marketing to regain the favor of U.S. drinkers.

• An uptick in the number of Americans who say they don’t drink, at around 38 percent from 35 percent in 2005. My guess is that many of these people are wine drinkers who drink only on birthdays, anniversaries and holidays, but have given up alcohol for health or pricing reasons.

Is the U.S. wine boom over?

U.S. wine boomThe end of the U.S. wine boom will change the wine business, and consumers almost certainly won’t be the better for it

I’ve written about this before on the blog, but usually in bits and pieces – that the 40-year U.S. wine boom may have ended. But this story, which I wrote for the trade magazine Wine Business International, goes into all the grisly details. There’s a lot of math involved, and the last quarter of the piece is business-oriented, but still worth reading for those of us who love wine.

That’s because the end of the wine boom will change the wine we are able to buy, how we are able to buy it, and who makes our wine – and not necessarily for the better. Consider:

• The growth that made the U.S. the biggest wine consuming country in the world has ended. Instead of the 5 to 10 percent annual increases that weren’t unusual during the four-decade run-up, look for wine consumption to grow only as much as the increase in the country’s drinking-age population, about one percent.

• Prices could well remain flat, since more and more wines will be chasing the same number of wine drinkers. By one analyst’s estimate, there are about 125,000 wine labels on U.S. shelves in any one year, but the high frequency wine drinker buys only about 75 bottles a year. Who is going to buy the rest?

• Flat prices are good news for the consumer, but the bad news? Consolidation among retailers, distributors and producers, which shows no sign of ending, could make it more difficult for all but the biggest producers to make an impact on wine drinkers. Who else will have the money to market wine in that glutted a market? And the wines they’ll be marketing will almost certainly be boring, focus-group driven, and all taste the same. In other words, red blends run amuck.

Those three things may also offer an explanation for premiumization. If you can’t sell more wine, and prices are flat for the wine you can’t sell anyway, then invent new, more expensive wine to sell. Which sees to be what has happened since the recession started in 2007 – the value of the wine sold in the U.S., as measured in dollars, has increased more than the amount of wine sold, 25 percent to 21 percent.

Finally, the trade magazine post has generated a fair amount of buzz on the cyber-ether, and Forbes even picked it up (though the piece misspelled my name). Which is all well and good, but why didn’t anyone notice this before? Were we too busy focusing on toasty and oaky to see what was going on?

Photo courtesy of Peachridge Glass, using a Creative Commons license

Winebits 408: Diageo sale, wine imports, French wine

diageo sale ? Treasury gets Diageo wine: Get ready for more Big Wine news in the wake of Diageo selling its handful of wine brands to Australia’s Treasury Wine Estates. The $351 million deal gives Treasury four million cases worth of wine in the U.S., which may move it into the top five of U.S. producers. The key is what Treasury will do with the brands, which include Sterling: Will it keep all of them, or sell some it sees as too cheap for its new focus on wine costing more than $10? Also, the purchase was as much about getting Diageo’s infrastructure in the U.S., including its bottling lines. Finally, there is this great quote from Treasury boss Michael Clark: “We remain committed to our strategic road map of transitioning our business from an order-taking agricultural company to a brand-led and capital-light marketing organization.” If anyone can explain what that means, I’ll send you a copy of the cheap wine book.

? It’s all about Italy: We can argue about what wine consumers want, but we can’t argue with the numbers. Hence, Italy’s continued success in selling wine in the U.S., accounting for one-third of all imported wine in dollar terms the first six months of this year. The big losers? Australia, still, as well as Chile and Argentina. Americans want pinot grigio and Prosecco, and Italy is happy to give it to us at mostly cheap prices. The Aussies, on the other hand have little that anyone wants, as sales fell seven percent in dollars and six percent in volume. How the mighty have fallen.

? The French are drinking again: Decanter reports that a government survey found a six percent increase in “occasional wine drinkers,” who accounted for half of the respondents. This is important news in a country where wine consumption has declined steadily for decades. This group included younger drinkers and women, who say they were more likely to have one or two glasses of wine a week. To put this in perspective, that one or two glasses of wine a week is more than bottle a month, which means an occasional wine drinker in France drinks more than the average adult in the U.S.

Winebits 376: Apothic, restaurant wine, wine consumption

apothic ? A revolutionary product? Gallo’s Apothic, which revolutionized sweet red wine when it was introduced in 2007, may be doing it again. The company has released Apothic Crush, a slightly sweet red wine with 14.5 percent alcohol. In this, it appears to be the first sweet high alcohol wine that actually admits to being sweet and high in alcohol. For most of wine’s history, sweet table wines had less alcohol than dry wines not only because that’s how fermentation worked, but because no one thought consumers would drink a high alcohol sweet wine. But that has changed, first with the trend toward riper, more alcoholic wines, and second, with improvements in winemaking technology. In this, who knew Robert Parker, who has championed riper, higher alcohol wines, would pave the way for a Gallo product? Or, as the noted philosopher Mick Jagger has said more than once, “You can’t always get what you want/But if you try sometime you find/You get what you need.”

? Less hope for wine lists? Is the end coming for the independent restaurant? That may be one of the conclusions from a recent study, which found that the number of independents fell by two percent in the U.S. in 2014, and that the number of full-service independents dropped three percent. Chains, meanwhile, continued to grow in the low single digits. Why does this matter to wine drinkers? Because those independents, and especially the full-serves, are the last best hope for improved restaurant wine lists. Chains usually don’t care about wine and make decisions in a corporate office based on price, which means they have the crummiest and most overpriced wine lists. Independents, for all their problems with wine, generally do a better job than chains. So any drop in the number of chains should be worrisome for wine drinkers who want choices that aren’t from Big Wine.

? Beer, wine, or spirits? This chart, from Ghost in the Data, should answer all questions about whether the U.S. (or any other country in the world) is a wine drinking country. We’re not — it’s still beer. In fact, save for part of western Europe, the world is mostly indifferent to wine. This is something my colleagues in the Winestream Media should pay more attention to, instead of patting themselves on the back because we drink more wine than any other country in because we have more people than France and Italy.

Winebits 351: Wine glasses, wine laws, and economic growth

wine news wine glasses ? Do wine glasses matter? The answer is no, says the Vinepair website in a post that includes the sentence, “Any industry that marries the existence of experts, the spending of cash, and the words ‘acquired taste’ as exquisitely as the wine industry does is bound to intimidate the uninitiated.” Which was a guarantee the Wine Curmudgeon would write about it. The post dismisses the idea that different shapes matter — a Bordeaux glass, a Burgundy glass, and so forth — and cites several studies and zings Riedel, the big glass company, repeatedly. Most of which makes sense, since I’ve never been convinced spending $100 for a glass is going to make all that much difference. The difference comes, I think, in whether you use well-made glasses instead of poorly-made ones. I buy the Forte from Schott Zwiesel, about $10 a glass, and am content. That’s about the twice the price of Libbey glasses, but the expense seems worth it.

? Hell no, we ain’t reformin’: Pennsylvania’s state-controlled liquor store system has been the subject of much controversy as well as repeated demands for privatization. Reform seems as far away as ever, despite all the effort, and I’ve discovered the reason: Money. The Pennsylvania Liquor Control Board, which runs the stores, is a $2.24 billion business. Which is damned big — almost twice the annual sales of Crate & Barrel and only one-sixth the total of Whole Foods, even though the upscale grocer is a national company with more than 360 stores. How many state legislators, regardless of political persuasion, are going to throw away that much money? I’m not even sure I would.

? Not just rich people drink wine: There’s a long and surprisingly boring post on Forbes discussing whether wine sales can predict economic growth. If someone can figure out what it actually says, let me know. As near as I can tell, it says that high-end wine sales are a predictor of U.S. economic health, which is not true and seems a silly thing for someone at Forbes to say. Because only five percent of the U.S. population buys wine that costs $20 or more, and the average price of a bottle of wine is about $10. So what the price of vineyard land in Napa Valley has to do with economic growth is beyond me. Which is probably why I do this and don’t write for Forbes.

Another study agrees: We buy wine on price

wine genome studyThe biggest surprise in the Wine Genome study from Constellation Brands, one of the biggest wine companies in the world? That one-fifth of us buy wine on price.

“We knew they were out there, but the widening span of the study showed how deeply the recession cut,” said Dale Stratton, the Constellation official who oversaw this version, the third, of the company’s Project Genome, designed to identify the most common types of of wine drinkers based on purchase behavior, motivation, and preferences. “The recession had a big impact and significantly changed consumer spending habits.”

Stratton laughed when I asked him about this. No, he said, it’s not that Constellation (whose brands include Rex Goliath, Mark West, and Robert Mondavi) didn’t expect price to be important. Rather, it’s that price-driven wine drinkers were the biggest category of the six, doubling the number of Enthusiasts — those who “love everything about the wine experience,” including researching purchases, reading reviews, and sharing wine with others. In other words, the Winestream Media’s audience. The other thing to note here? The Enthusiasts account for 15 percent of profit, compared to 14 percent for the Price-Driven group. Harrumph.

The study, which updated a 2004 effort, is full of surprises — unless, of course, you visit here regularly (and you can see a nifty infographic describing each group here):

? The third-biggest group, at 19 percent, are Overwhelmed, which means pretty much what it says: “I don’t enjoy shopping for wine, and find it complex and overwhelming. This, says Stratton, reinforces the need for wine education, not only for consumers but for those who sell wine — distributors, retailers, and restaurateurs. Hearing this was surprising enough, but I almost dropped the phone when Stratton said that winespeak is one of the reasons the overwhelmed are overwhelmed. Maybe, he said, retailers and wine writers should find simpler terms to use.

? Women, who have traditionally skewed higher for wine purchases at the lower end, are becoming more important at the higher end. The Enthusiasts, who were about 65 percent male in 2004, were close to 50-50 this time. “This means more women see wine as a hobby,” says Stratton, and that means more women attend tastings and shop at wine-specific retailers.

? Wine snobs, called Image Seekers, are still with us, and in a big way. They account for 18 percent of wine drinkers, but contribute 26 percent of profits, more than any other group. Given the wine they drink, that’s probably not surprising.

? Welcome the Millennials to wine, in the form of the Engaged Newcomer at 12 percent. This group is young, wants to learn more, and recognizes that wine is intimidating. They also spend more on a bottle than the other groups, about $13.

One other point worth noting: This kind of study is common for consumer packaged goods like laundry detergent and ketchup. That Constellation can do for wine what Proctor & Gamble does for its products speaks volumes about how much the wine business has changed, and that it is becoming more mainstream.

“Wine is increasing household penetration at a good clip, and the audience has broadened,” said Stratton. “And it’s going to continue to change, as the American population changes.”