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Wine - US - November 2016

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY 
The issues
Half of wine buyers consider themselves “beginners”
Figure 1: Wine behavior – Beginner, by generation, August 2016
Wine is not widely viewed as an artisanal/craft product
Figure 2: Wine statements – Artisanal/craft, August 2016
Industry terms don’t resonate with wine buyers
Figure 3: Wine statements – Wine terms, August 2016
The opportunities
Sparkling share of sales continues to grow
Figure 4: US volume sales of wine, by segment, 2011-21
Smaller formats may drive trial
Figure 5: Wine statements – Full-size bottle, by “beginner,” August 2016
85% of wine buyers purchase more around the holidays
Figure 6: Wine behavior – Holiday purchase, August 2016
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Volume sales of wine grow 7% from 2011-16
Sparkling share of sales continues to grow
Domestic wine comprises a higher percent of volume sales
Off-premise sales makes up the largest share of the market
Beer leads alcohol consumption
MARKET SIZE AND FORECAST
Dollar sales of wine are estimated to reach $61 billion in 2016
Figure 7: Total US on- and off-premise sales and fan chart forecast of wine, at current prices, 2011-21
Figure 8: Total US on- and off-premise sales and forecast of wine, at current prices, 2011-21
Figure 9: Total US on- and off-premise sales and forecast of wine, at inflation-adjusted prices, 2011-21
Volume sales of wine grow 7% from 2011-16
Figure 10: Total US volume sales and forecast of wine, 2011-21
Figure 11: Total US volume sales and forecast of wine, 2011-21
MARKET BREAKDOWN
Sparkling share of wine sales continues to grow
Figure 12: US volume sales of wine, by segment, 2011-21
Domestic wine comprises higher percent of volume sales
Figure 13: US volume sales of wine, by origin, 2011-15
Off-premise sales makes up the largest share of the market
Figure 14: US volume sales of wine, by channel, at current prices, 2011-15
MARKET PERSPECTIVE
Beer leads alcohol consumption
Figure 15: Alcohol consumption – Any drink*, October 2015
Figure 16: Correspondence Analysis – Perceptions of alcoholic drink types, October 2015
Figure 17: Perceptions of types of alcoholic drinks, October 2015
KEY PLAYERS – WHAT YOU NEED TO KNOW 
19% of wine drinkers consume Barefoot table wine offerings
94% of table wine launches are in bottles
Cap closures are gaining share among table wine launches
Cans are gaining share among sparkling wine launches
LEADING WINE BRANDS
19% of wine drinkers consumer Barefoot table wine offerings
Figure 18: Leading brands consumed – Domestic table wine, 2012 and 2016
9% of wine drinkers consume Yellow Tail table wine options
Figure 19: Leading brands consumed – Imported table wine, 2012 and 2016
10% of wine drinkers drink Korbel
Figure 20: Leading brands consumed – Champagne/sparkling wine, 2012 and 2016
Taylor and Harvey’s Bristol Cream lead Port/dessert wines consumed
Figure 21: Leading brands consumed – Port/dessert wine, 2012 and 2016
WHAT’S WORKING?
94% of table wine launches are in bottles
Figure 22: Table wine launches, by leading pack type, 2012-16*
Cap closures are gaining share among table wine launches
Figure 23: Table wine launches, by closure type, 2012-16*
Cans are gaining share among sparkling wine launches
Figure 24: Champagne/sparkling wine launches, by leading pack type, 2012-16*
Ethical claims are on the rise among table wine launches
Figure 25: Table wine launches, by leading claims, 2012-16*
WHAT’S NEXT?
Packaging innovation can already be seen in the category
Cans
Smaller sizes
Boxes
Capitalizing on other alcoholic beverage trends
Focus on craft
Make it sparkle
Wine cocktails
Figure 26: Wine statements – Innovation, by generation, August 2016
Figure 27: “Barefoot Courtside Cup Cocktail,” online video, June 2016
Figure 28: “Shipwrecked Margarita – Sutter Home Wine Cocktails,” online video, July 2016
THE CONSUMER – WHAT YOU NEED TO KNOW 
54% of adults 22+ purchase still table wine, 28% purchase sparkling
Half of wine buyers consider themselves “beginners”
Price leads purchase decision
Wine is not widely viewed as an artisanal/craft product
Industry terms don’t resonate with wine buyers
85% of wine buyers purchase more wine around the holidays
WINE PURCHASE 
More than half of adults purchase still table wine, a quarter purchase sparkling options
Figure 29: Wine purchase, August 2016
Wine purchase is pretty evenly split between men and women
Figure 30: Share of wine purchase, by gender, August 2016
Millennials and Boomers make up largest share of wine buyers
Figure 31: Share of wine purchase, by generation, August 2016
Hispanics make up a small portion of wine buyers
Figure 32: Share of wine purchase, by Hispanic origin, August 2016
Close to half of wine buyers are from the highest income-earning HHs
Figure 33: Share of wine purchase, by HH income, August 2016
WINE EXPERIENCE
The majority of wine drinkers drink wine multiple times per week
Figure 34: Wine behavior – Consumption, August 2016
Men are more likely to be frequent drinkers
Figure 35: Wine behavior – Consumption, by gender, August 2016
Half of wine buyers consider themselves “beginners”
Figure 36: Wine behavior – Beginner, August 2016
Men are less likely than women to identify as a “beginner”
Figure 37: Wine behavior – Beginner, by gender, August 2016
Millennials are most likely to identify as wine beginners
Figure 38: Wine behavior – Beginner, by generation, August 2016
Vast range intimidates 37% of wine buyers
Figure 39: Wine behavior – Intimidation, August 2016
Younger drinkers are most likely in need of guidance
Figure 40: Wine behavior – Intimidation, by generation, August 2016
Figure 41: Wine behavior – Intimidation, by “beginner,” August 2016
WINE FORMATS
Packaging
41% of wine buyers purchase wine in boxes
Figure 42: Wine behavior – Format purchased, August 2016
Figure 43: Wine statements – Interest in cans, August 2016
Millennials make up the majority of nonconventional format buyers
Figure 44: Wine behavior – Share of format purchased, by generation, August 2016
Purchase of alternative formats increases with income
Figure 45: Wine behavior –Format purchased, by HH income, August 2016
Alternative formats continue to struggle with perception
Figure 46: Wine statements – Perception of alternative formats, August 2016
Men are more likely to be open to alternative formats
Figure 47: Wine statements – Perception of alternative formats, by gender, August 2016
Figure 48: Wine statements – Interest in cans, by gender, August 2016
Millennials are the strongest target for canned wine
Figure 49: Wine statements – Perception of alternative formats, by generation, August 2016
Figure 50: Wine statements – Interest in cans, by generation, August 2016
Smaller formats may drive trial
Figure 51: Wine statements – Full-size bottle, August 2016
Millennials are attracted to smaller sizes
Figure 52: Wine statements – Full-size bottle, by generation, August 2016
Smaller formats may open the door to “beginners”
Figure 53: Wine statements – Full-size bottle, by “beginner,” August 2016
Origin
US wine buyers are more likely to purchase domestic options
Figure 54: Wine behavior – type purchased, August 2016
Lower-income HHs are less likely to purchase imported wine
Figure 55: Wine behavior –Type purchased, by HH income, August 2016
Italian wine leads imported consumption in the US
Figure 56: Types of imported wine consumed – Country of origin, 2012 and 2016
Styles
Merlot and cabernet sauvignon are most popular domestic wine types consumed
Figure 57: Types of domestic wine consumed, 2012 and 2016
WINE PRICING
Wine buyers have a fairly high threshold for value wine pricing
Figure 58: Price sensitivity – Mean, August 2016
Women have a lower tolerance for high price
Figure 59: Price sensitivity – Mean, by gender, August 2016
Millennials are more likely to see wine in higher price points
Figure 60: Price sensitivity – Mean, by generation, August 2016
Wine buyers who prioritize price have a lower threshold
Figure 61: Price sensitivity – Mean, by price as a purchase factor, August 2016
PURCHASE LOCATION
Off-premise purchase leads
Figure 62: Wine purchase location, August 2016
Men are a stronger target for online, on-premise purchase
Figure 63: Wine purchase location share, by gender, August 2016
61% of on-premise wine buyers are Millennials
Figure 64: Wine purchase location share, by generation, August 2016
Figure 65: Wine purchase location – Off-premise, by generation, August 2016
Lower earning HHs almost solely buy their wine at supermarkets, mass
Figure 66: Wine purchase location, by HH income, August 2016
PURCHASE DRIVERS
Price leads purchase decision
Figure 67: Wine purchase drivers – Top rank and any rank, August 2016
Women are more price conscious than men
Figure 68: Wine purchase drivers – Any rank, by gender, August 2016
Older wine buyers seek more traditional cues, Millennials look for recommendations
Figure 69: Wine purchase drivers – Any rank, by generation, August 2016
Beginners are more likely to use price as a purchase factor
Figure 70: Wine purchase drivers – Any rank, by “beginner”, August 2016
Price plays a smaller role among on-premise buyers
Figure 71: Wine purchase drivers – Any rank, by purchase location (Nets), August 2016
Recommendations are useful to online shoppers
Figure 72: Wine purchase drivers – Any rank, by off-premise purchase location, August 2016
Local does not appear as a strong purchase driver
Figure 73: Wine statements – Local, August 2016
Figure 74: Wine statements – Local, by generation, August 2016
ATTITUDES TOWARD WINE
Wine is not widely viewed as an artisanal/craft product
Figure 75: Wine statements – Artisanal/craft, August 2016
Industry terms don’t resonate with wine buyers
Figure 76: Wine statements – Wine terms, August 2016
Straightforward descriptors are most likely to resonate with women
Figure 77: Wine statements – Wine terms, by gender, August 2016
Appealing to Boomers can come from simplifying wine language
Figure 78: Wine statements – Wine terms, by generation, August 2016
Those who base purchase decision on descriptors want simple ones
Figure 79: Wine statements – Wine terms, by importance of descriptions in purchase decision, August 2016
Wine professionals are looked to for simple, straightforward guidance
Figure 80: Wine statements – Wine terms, by importance of recommendations in purchase decision, August 2016
Figure 81: Wine statements – Wine terms, by wine experience, August 2016
A quarter of wine drinkers are open to casualization
Figure 82: “Anthem,” online video, April 2016
Figure 83: Wine statements – Casual, August 2016
HOLIDAY PURCHASE
85% of wine buyers purchase more around the holidays
Figure 84: “Add Sparkle to Your Table,” online video, December 2016
Figure 85: “Woodbridge Chardonnay Applesauce,” online video, October 2016
Figure 86: “Woodbridge Pinot Garlic Butter,” online video, September 2016
Figure 87: Wine behavior – Holiday purchase, August 2016
The holidays are a good time to engage Millennial wine buyers
Figure 88: Wine behavior – Holiday purchase, by generation, August 2016
Holiday gifting is a strong sales opportunity for high-income earners
Figure 89: Wine behavior – Holiday purchase, by HH income, August 2016
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
Abbreviations and terms
Abbreviations
APPENDIX – MARKET 
Figure 90: US volume sales of wine, by segment, 2011-21
Figure 91: US volume sales of wine, by origin, 2011-15
Figure 92: US volume sales of table wine, by origin, 2011-15
Figure 93: US volume sales of Champagne/sparkling wine, by origin, 2011-15
Figure 94: US volume sales of dessert and fortified wine, by origin, 2011-15
Figure 95: US volume sales of wine, by channel, at current prices, 2011-15
APPENDIX – KEY PLAYERS 
Figure 96: Leading brands consumed – domestic table wine, 2012-16
Figure 97: Leading brands consumed – imported table wine, 2012-16
Figure 98: Leading brands consumed – Champagne/sparkling wine, 2012-16
Figure 99: Leading brands consumed – Port/dessert wine, 2012-16
Figure 100: Table wine launches, by pack type, 2012-16*
Figure 101: Table wine launches, by closure type, 2012-16*
Figure 102: Champagne/sparkling wine launches, by leading pack type, 2012-16*
Figure 103: Table wine launches, by leading claims, 2012-16*
Figure 104: Champagne/sparkling wine launches, by leading claims, 2012-16*
APPENDIX – CONSUMER 
Figure 105: Mean # glasses consumed, 2012-16
Figure 106: Types of domestic wine consumed, 2012-16
Figure 107: Leading types of domestic wine consumed, by age, 2016
Figure 108: Types of imported wine consumed – country of origin, 2012-16
Figure 109: Types of imported wine consumed – country of origin, by age, 2016

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