Tag Archives: wine sales

Winebits 664: Fast food wine pairings, ancient wine, pandemic wine sales

Fast food wine pairings

No, this was not the WC’s favorite hat of all time, though the uniform did turn me off polyester forever.

This week’s wine news: Are fast food wine pairings the next big thing? Plus, 7th century BC wine, and more confusing numbers about pandemic wine sales.

Bring on the Whoppers: Who knew the Wine Curmudgeon would be able to discuss the fast food of his youth two weeks in a row? But Christine Struble, writing for the Foodsided blog, asks: “Are fast food wine pairings becoming the newest food trend?” Perhaps, but the concept isn’t new. I received a release in the blog’s early days from a brand called Fat Bastard touting fast food wine pairings; I’ve written about it here several times; and I taught them to wine classes at the late Cordon Bleu and El Centro. Because if you’re trying to reach people whose diet consists of fast food, what better way to teach pairings? Or, as I asked one group of Cordon Bleu students, “What do we pair with a Burger King cheese Whopper?” The consensus was supermarket-style merlot; plus, they got to hear about working the broiler at the Burger King on Skokie Road in Highland Park, Ill., resplendent in my polyester uniform and paper hat.

2,700 years ago: Archeologists have discovered the first Iron Age wine press in present-day Lebanon, reinforcing the idea that wine played a key role in the ancient world. They found the press, used to extract juice from grapes, during excavations at the Phoenician site of Tell el-Burak near the present day city of Sidon (an important trading hub in wine and other goods in the Mediterranean region). Grapes were grown in and around Tell el-Burak, which was inhabited from the late eighth to the middle of the fourth century BC. Researchers have also found amphorae, ancient wine bottles, in the area. But no one was quite sure how the grapes were turned into wine until this discovery.

More conflicting statistics? Blake Gray, writing on Wine-Searcher.com, finds even more conflict in wine sales during the pandemic. He cites research from California’s Sonoma State University, which found that even though U.S. wine sales overall are up, 57 percent of U.S wineries say their own sales are down. Or, as we have noted here, there’s little sense in trying to make sense of any of the numbers. Ostensibly, “Big wineries are taking more market share at the expense of small wineries,” said the report. You will also be happy to know, according to one analyst at the same seminar, that Americans may have had more disposable income than ever, despite the pandemic. I wonder: What country is he living in?

Photo courtesy of MeTV, using a Creative Commons license

Winebits 658: Wine sales, NBA wine, Wine.com

wine salesThis week’s wine news: One of the wine industry’s top analysts says sales could drop 12 percent in value this year. Meanwhile, one NBA player has turned his hotel room into a wine cellar and Wine.com says its worth $1 billion.

• Premiumization’s death knell? The pandemic could mean a 12 percent drop in the value of wine sold in the U.S., says analyst Jon Moramarco, editor with Gomberg, Fredrikson & Associates. His numbers are among the best in the country, so the wine business pays attention. Moramarco told an on-line seminar that he expects total U.S. wine sales to end the year down 12.5 percent in value, an almost unheard of decline, though volume will be up 1.3 percent. The reason, of course, is the loss of the restaurant and bar business during the pandemic. He told the audience that some of those numbers were evident in the first half of this year: Volume was up 5.7 percent from 2019, but value was down 6.5 percent. In other words, we’re buying more, cheaper wine than we have in years – maybe even sine the recession.

How cold is it? Portland Trail Blazers guard CJ McCollum, a noted wine lover, has converted his entire hotel room into a wine cellar during the NBA’s pandemic playoffs. McCollum cranks up the air conditioning so the room stays between 50 and 60 degrees – which, as we all know, is the ideal temperature for storing wine. The New York Post reports that McCollum does raise the temperature slightly when he’s in the room, but otherwise the goal is protecting his 84 bottles of wine (mostly Oregon pinot noir). Frankly, the Wine Curmudgeon is impressed. I love wine, but I don’t know that even I would do that.

Really? $1 billion? Wine.com, the on-line retailer, has valued itself at $1 billion, as it looks for to borrow money to expand. Bloomberg.com reported that Wine.com wants to raise around $50 to to $75 million, part of a process that could include become a public company through a stock offering. Needless to say, the pandemic has boosted the retailer’s business; sales were up 79 percent over the past 12 months and its CEO said, “The last quarter has fundamentally changed our growth trajectory.”

Convenience store wine sales 2019

convenience store wine sales

More than half of the country’s convenience stores, like QuikTrip, now sell wine.

Convenience store wine sales in 2019 were flat, but that’s not necessarily bad news for the wine business

Table wine sales in U.S. convenience stores were flat in 2019, which seems like more bad news for the wine business. That’s because sales had increased 20 percent in dollar terms in 2018, the second year in a row that c-store sales outperformed the overall U.S. market.

In this, convenience stores have been one of the bright spots in the wine business over the past couple of years. Younger wine drinkers aren’t as put off by buying wine in a 7-Eleven as their elders are, and it’s more convenient for them, too — Pampers and wine on the way home from work. It also helps that stores have better selection than years past, and not just wine coolers and big boxes of sweet wine.

So Jeff Lenard, the spokesman for the National Association of Convenience Stores, says not to worry.

“I think the percentage of stores selling wine is the more important stat,” he emailed me this week during our annual discussion about the group’s wine survey numbers. “As we have seen with fresh items in stores, it takes time to grow the offer and raise awareness so that customers can expect to find quality wine in a store. And in many cases, it’s a wine offer that is more curated, so that’s even more difficult for stores to add.”

And Lenard may have a point:

• The number of convenience store selling wine increased some six percent in 2019 to more than 52 percent — a number that may be an all-time high. That’s an amazing statistic, given that wine sales in 7-Eleven, RaceTrac, QuikTrip, Speedway, and the like are illegal in many states, including New York and Pennsylvania.

• Wine sales decreased by one-half of one percent per store, which is a letdown from 2018’s robust growth. But it’s in line with overall wine sales in the U.S., so it shouldn’t be too surprising. In addition, says Lenard, it’s not unusual to see per store sales decrease when more stores offer a product.

• The number of stores selling beer and spirits barely grew, by about one percent each. So wine’s store growth is that much more impressive.

• Given how one parses the c-store numbers, as well as the unreliability of U.S. wine sales numbers in general, it’s possible that convenience store wine once again accounted for as much as 2 percent of all the wine sold in the U.S.

Meanwhile, early reports indicate that c-store sales will increase substantially in 2020 because of the pandemic, as stores picked up sales when restaurants and bars were closed.

Photo: “Priceless” by Greenville, SC Daily Photo is licensed under CC0 1.0

More about convenience wine store sales:
Convenience wine store sales 2018
Convenience wine store sales 2017

Winebits 647: Responsible drinking, wine sales, wine writing

responsible drinkingThis week’s wine news: We’re not boozing it up during the duration, plus what comes next as the country opens up and a wine writer discusses wine writing and objectivity

Not overindulging: You couldn’t tell from many of the medical warnings we’ve heard over the past couple of months, but a survey last week found that we’re not drinking more than normal during the coronavirus pandemic. Responsiblity.org, a group funded by some of the biggest alcohol companies int the world, says more than six out of 10 Americans are drinking the same or less as before the pandemic – and that includes 11 percent of us who say they’ve stopped drinking entirely. These studies can be unreliable, and that it was paid for by liquor companies gives another reason to wonder. Having said that, the numbers – 35 percent drinking the same, 28 percent less – jive with similar surveys from Nielsen.

What will it take? Nielsen reports that alcohol sales will have to continue to grow more than 20 percent to offset losses from closed restaurants during the pandemic. Which isn’t very good news for the wine business, if the Responsibility.org survey is correct. That means, as restaurants open at less than capacity, or don’t open at all, we’ll have to buy more from retail to make up the difference from what we bought in restaurants.

Hardly objective: Richard Hemming, MW, a Singapore-based wine writer, caused a stink in the cyber-ether last week when he wrote that most wine writers aren’t particularly objective and do consumers a disservice. “the wine media is frequently compromised by the close-knit nature of the trade. … The quick answer is money.” The industry has it, whether in samples or trips, and wine writers take those perks. It would be one thing for me to write this – which I do regularly – but that someone with initials after the name put this in print is mind-boggling. I’m trying to set up a podcast with Hemming to talk about this; as soon as we figure out a way to handle the time difference between Singapore and Dallas, I’ll post the podcast.

Winebits 641: The “Big Wine makes mega-deals” edition

international styleThis week’s wine news: Constellation Brands and E&J Gallo finalize their cheap wine blockbuster, plus Geyser Peak is sold again and Treasury wants to set Penfolds free

Finally done? Constellation Brands’ $1.1 billion sale of its low-price wine labels to E. & J. Gallo is expected to close by the end of June, despite the coronavirus pandemic, reports the Press-Democrat website. The deal will send almost all of Constellation’s $10 wines to Gallo, including Black Box, Ravenswood, Clos du Bois, and Mark West, as well as vineyards and wineries in California and New York. The original April 2019 deal, worth $1.7 billion, had to be revised after U.S. regulators objected.

Poor Geyser Peak: When I started writing the blog, Geyser Peak’s $10 sauvigngon blanc was one of the most dependable cheap wines on the market. But that was also several owners ago, and quality has never been the same. So it’s not necessarily bad news that the brand has been sold once again. The current owner, Australia’s Accolade Wines, will sell Geyser Peak, Atlas Peak, XYZin and Outlot to something called 2 Bears LLC. No word on who is behind 2 Bears.

Whither Penfolds? Australia’s Treasury Wine Estates, one of the two or three largest producers in the world, has been feuding with stock analysts for the past year or so, defending what the analysts have been calling the company’s poor performance. So Treasury may spin off Penfolds, one of the world’s great wine brands and home to the legendary Penfolds Grange (which I’ve been lucky enough to taste and so can attest to its greatness). Whether this pleases anyone in the shadow boxing world of financial analysis is anyone’s guess, but it points to the pressures Treasury faces in a world where people drink less wine and Big Wine companies are being urged to shed brands.

Winebits 640: Aussie booze rationing, restaurant closures, wine sales

booze rationing

Yes, that’s a line at an Australian liquor store as customers “stock up.”

This week’s wine news: Booze rationing, as only the Australians can do it, plus looking at restaurant closures and that pandemic-fueled spike in wine sales

How much do you buy otherwise? Australia’s top retailers are rationing booze purchases to prevent hoarding, which seems reasonable given all that is going on. But the limits are mind-boggling: two 24 beer-cases or pre-mixed drinks, 12 bottles of wine, or two bottles of spirits. And you can buy the limit in two of those categories. Even with pandemic-related pub closures, alcohol spending Down Under increased 34 percent in the 52 weeks to March 27. I wonder what the U.S. neo-Prohibitionists would say about that. The Reuters story did note that “one in six adults drinks more than the recommended daily maximum.”

Restaurant closures: More than one in 10 U.S. restaurants could be closed permanently by the end of the month, says a study from the National Restaurant Association. Restaurant Business reports that three percent have already closed, which translates to 30,000 locations around the country. If 11 percent close, which the study said was possible, that’s another 100,000 empty stores. Nationally, restaurant sales were down 47 percent between March 1 and March 22. “That’s a stunning decline for an industry that operates on a weak foundation of thin margins and excessive debt,” said the story.

Wine sales up: Some good news – wine sales in the U.S. were up 66 percent March 7 to March 14, far outpacing every other alcoholic beverage as Americans, to quote Nielsen, participated in “consumer pantry-loading time.” That phrase is even worse than social distancing and sheltering in place – shame on you, Nielsen. On-line sales, meanwhile, were up an unprecedented 243 percent. That figure is worth another post; look for it on Friday.

Winebits 639: Premiumization, Pennsylvania state stores, direct to consumer

cheap wine

“Premiumization never really bothered me.”

This week’s wine news: Will the pandemic finish off premiumization? Plus, turmoil in Pennsylvania’s state wine stores and the favorite DTC grapes

Is premiumization over? A top wine business analyst has told the industry that its drink less, but drink “better” mantra – premiumization – could be ending thanks to the coronavirus pandemic. Spiros Malandrakis, industry manager for alcoholic drinks at Euromonitor International, told the Harpers UK trade magazine that premiumization is at a crossroads: “What we saw in the recession of 2008 was that even if people that could afford more expensive wines or niche varietals, they didn’t buy them because it looked crass. The context has changed. I’m not saying the industry is over. What we know from history is that people will always continue drinking. It’s not the end of the world but it will be a different world to the one we’re used to.” In this, he’s not the first to predict premiumization’s end. But it is one more voice suggesting that the new normal in the new future could be $10 wine.

More fun in Pennsylvania: Pennsylvania’s state liquor store system has come in for much fun on the blog. And why not, given wine vending machines? But the decision to close the state stores during the pandemic has met with serious opposition, not the least of which is the loss of state tax revenue. Even in New York, the center of the U.S pandemic, liquor stores have remained open. Apparently, the state is reconsidering its decision, and may allow limited Internet alcohol sales. April 2 update: The state did reopen its online liquor sales system, but the system will be quite limited.

Favorite DTC grapes: This is a contradiction that seems difficult to explain: Why is chardonnay the best selling wine grape at retail, but cabernet sauvignon is the best seller when consumers buy directly from the winery? That’s the result from a recent SOVOS/Ship Compliant study (via Wine Industry Insight), where cabernet was the best seller with 17 percent of volume, almost twice as much as chardonnay. Typically, chardonnay accounts for about 20 percent of retail sales. Any thoughts would be much appreciated.