Fruitful Vines According to data from Wine Institute, 913 million gallons of all wines were consumed in the US during 2015, a 3.0% increase over 2014’s 886 million gallons. Total wine consumption per US resident increased slightly from 2.81 to 2.83 gallons. The Wine Institute also reports that 383.9 million 9-liter cases were sold in the US during 2015, a 2% increase, which included all domestic and foreign wines distributed in the US. Total retail value was $55.8 billion, or 5.1% more than 2014’s $53.1 billion. Because of the growing takeout and delivery trend at many restaurants, Technomic forecasts a modest 2.3% increase in beverage alcohol spending in the away-from-home channel during 2016, with beer, +2.0%; wine, +2.0%; and spirits, +2.8%.

Grape Diversity IRI data in Beverage World’s 2016 State of the Market Report revealed that the total 2015 revenues of $922.4 million for the sparkling wine/champagne category increased 14.5%, compared to 6.3%, or $9.82 billion, for the much larger table wine category.   Similarly, sparkling wine/champagne’s case sales increased 11.6% to 7.4 million while table wines’ case sales increased 2.8%, to 126.3 million. In its annual State of the Wine Industry report, Silicon Valley Bank (SVB) forecasted a 9–13% sales increase for the premium wine segment during 2016, compared to 14–18% for 2015. Bottles prices at the $10.00+ price point will increase 4–8%.

Fine Wines for the Ages According to the Silicon Valley Bank report, Baby Boomers’ share of 2015 fine wine consumption was 41%, decreasing from 2014’s 44%. Generation X had a 32% share, compared to 28% for 2014 while Millennials’ share increased from 9.5% to 16%. Although Millennials had the smallest share of the three generations, SVB predicts they will have the largest share by 2026, moving ahead of Generation Xers, who will have the largest share during 2021. According to the Wine Market Council, there are more Millennial than Baby Boomer wine drinkers, 36% and 34%, respectively; however, more Baby Boomers than Millennials are “high frequency” wine drinkers, 38% and 30%, respectively.

A Healthy Habit…in Moderation Many studies have found that moderate consumption of wine is good for one’s health. A new study reported in an August 2016 online article from Wine Spectator stated, “…the cardioprotective effects of wine increased when consumed with food.”   Preliminary findings from a 2016 Danish study also reported on the Wine Spectator Website suggested, “…moderate wine consumption can reduce the risks of developing dementia and Alzheimer’s disease.” A May 2016 online Wine Spectator article about a Dutch study stated that red wine (as well as coffee) helps to maintain the health and diversity of the bacterial microbes in the intestines, which are critical to good digestion and overall health.

Sip-and-Savor Spirits The Distilled Spirits Council of the United States (DISCUS) reported total retail sales for this industry sector of $72 billion during 2015, with volume increasing 2.3% to 215.1 million 9-liter cases. According to analysis from Beverage World, revenues should continue to increase at a faster rate than volume, as more consumers, especially Millennials, enjoy premier-tier spirits, which increased 17.2%, and super-premium spirits, which increased 12.5%. Although the whiskey segment continues to be the spirits leader, at an 8% increase in revenue and a 4.9% increase in volume, tequila and brandy & cognac had the largest increases, at 9.4% and 12.0% in revenues, respectively.

Spirits Merits From 2001 through 2015, the spirits category has gained almost 7 percentage points in total alcohol revenue share and to the detriment of the beer sector: 2001, beer, 55.8%; wine, 15.5%; spirits, 28.7%; 2015, beer, 47.5%; wine, 17.0%; and spirits, 35.4%. Some of the trends driving this growth, according to DISCUS, are increasing demand for American whiskeys; a focus on craft-style, artisanal products; and an increase in the number of micro-distilleries from 92 during 2010 to 750 during 2015. The increase in whiskey consumption is not just in American products. Irish whiskey, at 16.1%, and single-malt Scotch whiskey, at 13.0%, were the two sub-sectors with the fastest growth rates during 2015.

Advertising Strategies With online wine buyers purchasing even more wine at brick-and-mortar stores, stores may want to consider a promotion that offers online buyers a 10% discount based on their most recent online purchase receipt. Today’s consumers, especially Millennials, crave experiential shopping, so wine merchants must plan a regular schedule of in-store events and aggressively advertise them with discounts/coupons for event attendees. Spirits retailers that are allowed to advertise these brands could feature once a month one of the top spirits brands by category in the table on page 3 of the Profiler and at a discounted price when purchasing one of the other top brands.

New Media Strategies As a community service, wine & spirits retailers could create a page on their Websites with information, especially videos, about responsible adult alcohol consumption from third-party sources and make it available to high schools and parents of Generation Z teenagers. Wine drinkers love to pair wine with specific types of dishes. Invite customers to upload photos and/or videos of their favorite dishes they’ve prepared and the wine they are serving with it and why they chose that wine. Conduct an amateur bartender contest via social media. Invite everyone to submit photos and/or videos of adult beverages they’ve created. Ask everyone to vote for his or her favorite. Provide a prize for the winner and coupons for all participants and voters.