The Big and Hot (and Not) Wine List

It’s time to update the “Big and Hot” list that I published last November. The list is pretty simple — what segments of the wine market are the biggest (measured by revenue) and which are the fastest growing? What’s big isn’t always hot and what’s hot isn’t always big. Here is my report, which also includes some notes on what’s not so hot.

But first a few disclaimers. The list is based upon published data found in the December 2011 issue of Wine Business Monthly. The data are from Nielsen surveys of table wine sales made through the off-premises food/drug/liquor store channels, not including convenience stores. These data measure an important slice of  wine sales, but not the whole thing (see the comments section of last year’s post for a good exchange on the strengths and limitations of Nielsen data).

Finally, data are for the 52 weeks ending 8/20/2011. Sorry for these limitations, but you know what they say about data: you want it good, fresh (or fast) and cheap but you can only have two at a time. These numbers are pretty good (if you understand their limitations) and relatively cheap, but not so fresh.  Not ideal, but it’s worth a look, especially if you haven’t checked on these trends in a while.

Category

$ millions in 52 weeks to 8/20/11

% change from previous year

Total Nielsen survey table wine

9,637

4.5%

Domestic table wine

6,924

6.2

Imported table wine

2,713

0.6

750 ml

6,584

6.1

1.5 l

1,977

1.1

3 l

323

3.3

4 l

111

-6.9

5 l

382

-0.9

Red table wine

4,797

4.3

White table wine

4,234

6.5

Chardonnay

2.050

1.8

Cabernet Sauvignon

1,444

6.6

Merlot

871

-4.6

Pinot Gris/Grigio

790

7.5

Italy import

831

3.2

Australia import

751

-7.1

Chile import

240

-2.1

France import

224

-4.4

Argentina import

222

20.2

New Zealand import

156

24.2

Syrah/Shiraz

240

-13.3

White Zinfandel

405

-6.0

Source: Wine Business Monthly 12/2011

-

Start with good news: the wine market measured here grew by 4.5% in these 52 weeks, which is up from 3.2% growth in the previous  year. The growth was concentrated in domestic wine versus imports. Domestic wine is both big (in $ revenues) and relatively hot (growing faster than the overall market). Imported wine? Not so hot as a broad category.

Wine in 750ml bottles is both big and hot. 1.5l bottles are big but not very hot. One liter containers are growing quickly (+14.8%), but from a small $18 million base. Interestingly, the 3l, 4l and 5l box wine formats grew more slowly than the overall market. Perhaps the box wine boomlet is fading?

Pinot Gris/Grigio is overtaking Merlot for the #3 spot on the “varietal wine” list. PG is hot and Merlot is cold in these data.

Australia continues to be big in terms of sales — it is far ahead of Chile for the #2 spot among wine imports. The gap is so huge that even though Australia wine sales are “cold,” falling 7% in the measured period, it would take years for them to fall to Chile’s level.

In the meantime, Argentina and New Zealand continue to be red hot, with 20+ percent sales gains on the year. In fact, it looks like Argentina will overtake France on this list, which is quite an achievement. But remember that this data excludes on-trade sales, where France may have an advantage.

Finally, I note that Syrah/Shiraz continues to shrink along with White Zinfandel and the whole blush wine category. In the case of White Zin, I suspect that it is a victim of the current trend towards Moscato and sweetish red wines. But these wine types don’t appear on the Nielsen list.

Let’s toast the good news of the growing wine market and hope that it continues!

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