America’s love affair with wine is waning.
Americans drank less wine last year, the first such drop in a quarter of a century, as millennials opt for alternatives like hard seltzers, cocktails and nonalcoholic beer.
The volume of wine consumed in the U.S. declined 0.9% in 2019, the first time it has fallen since 1994, according to industry tracker IWSR. The trend was ascribed to a generational shift as the number of millennials surpasses baby boomers, who drove strong demand for wine in America.
“Millennials are just not embracing wine with open arms compared to previous generations,” said Brandy Rand, IWSR’s chief operating officer for the Americas. “With the rise in low and no-alcohol products and general consumer trends toward health and wellness, wine is in a tough place.”
Sales of cheaper wine—under $10 a bottle—make up the most of the category but have been falling in recent years, offsetting a rise in more expensive bottles. Overall, U.S. wine sales by value rose 1.1% from a year earlier to $38.3 billion.
For decades, wine benefited from the theory that drinking in moderation—particularly red wine—was good for the heart. More recently, studies have disputed that finding, suggesting any amount of alcohol can raise cancer risks and that the benefits of drinking are more limited than once thought.As well as a decline in the number of baby boomers, the generation is also drinking less because of lower disposable income, smaller homes—making wine harder to store—and health concerns, says IWSR.
Wine consumption could be further hit by U.S. tariffs on European imports. The U.S. last year levied a 25% tariff on bottled table wines from France, Germany, Spain and the U.K., and has threatened further measures.
In response to declining consumption, some big companies are selling off mass-market wine brands and doubling down on high-growth areas.Constellation Brands Inc. —which owns Robert Mondavi wines, the Prisoner Wine Co. and Ruffino—is selling a string of its low-margin wine brands so it can focus more on its premium products. Last year it said virtually all growth came from products priced $11 and higher. Diageo PLC has also sold most of its wine brands.
Winemakers are also selling more in cans and cartons. Traditional wine bottles don’t lend themselves to casual outdoor drinking, or consumers wanting a single glass—a problem given more Americans live alone than in the past, according to Census Bureau data.
Just saw that article a few minutes ago.
I don’t buy all of this though:
As well as a decline in the number of baby boomers, the generation is also drinking less because of lower disposable income, smaller homes—making wine harder to store—and health concerns, says IWSR.
A few years ago brands like Yellow Tail were selling oceans of wine at less than $10 a bottle. Before that there was Rosemount and before that the KJ and Mondavi wines. Most of the market was cheap wine, not $50+ bottles.
And very very very few people store wine. They buy it and take it home and drink it.
As to health concerns, um, people are vaping. And eating Popeye’s chicken. So not everybody cares too much about their health.
More than anything, it’s fashion. Craft distilleries and craft beer are making huge inroads into the wine business, which has been pointed out earlier. And the profusion of wines by various “celebrities” makes it kind of ridiculous. When Madonna, Drew Barrymore, Yao Ming, Mike Ditka and others are all putting their names on wines, it becomes hard to think of wine as a drink that might encourage reflection. That branding emphasizes the fact that wine is a fashion product like anything else, and tastes change.
I don’t think it’s the apocalypse though. Seems like there will always be a market for good wine.
Also heard on 1010 Wins today, Millennials, are consuming alternate beverages. A definite decline and these tariffs are not going to help
While there are likely many issues at play, I wonder if declining quality in the bigger brands plays a part after years of market consolidation. Many popular and widely available brands have been bought up by the big corporate players, presumably with the intention of cutting costs and increasing profit. Some of that can be done through increased efficiencies, but I suspect in many cases the longterm result is decreased quality. Since people tend to be somewhat brand loyal, decreased satisfaction might result in abandonment of the category in general. This would seem to track with the fact that more expensive bottle sales are up but value brands are down; some people spend up to see if they find something they like better, while others simply drink beer, cocktails, drink less generally, smoke weed, whatever.
Don’t blame me, I did my part!
I agree with Greg - most of the effect is likely fashion.
Whoops. Seems like a dupe thread:
I believe this. I can see in the restaurants. Millennials gravitate much more towards cocktails and beer. I think they are much more affordable. Plus there is lees of a tendency for them to be attracted to high profile items and the subsequent pursuit.
Hard to compete when you’ve got ubiquitous THC & CBD.
Wait until Bud Light Seltzer comes out! It will be two years in a row!
Don’t laugh but White Claws and Truely are putting a hurt on wine and more so on beer
White Claw was the first thing I thought of when I saw the headline.