- US consumers are cutting back on wine.
- The reduction is most severe among infrequent wine drinkers, many of whom are leaving the category completely.
- Some previously enthusiastic wine drinkers aged over 60 are giving up alcohol.
- A growing number of others are reducing their alcohol intake.
- US regular wine drinkers are increasingly prepared to spend $15-30 when they do buy a bottle of wine.
Conventional wisdom suggests that, as human beings grow into maturity, they will develop a taste, and possibly appreciation, for wine. Of course, this was not true 50 years ago in the US, where even well-off citizens rarely drank any kind of wine, or 75 years ago in the UK where wine was the preserve of a small segment of the population. Whether it applied to the wine-producing nations of Europe, where wine was regularly served to adolescents, and where the poor rarely if ever had the opportunity to experience anything better than basic local wine, is also questionable.
Decreasing Wine Consumption
It is worth bearing this history in mind when considering the latest annual benchmark segmentation survey conducted in late 2021 by Engine Insights for the Wine Market Council (WMC). A sample of 7,580 adults revealed that, compared to respondents to previous surveys, consumers are far slower to become regular wine drinkers.
There are two basic explanations for this trend. The first – that they are socialising less – may be linked to the pandemic. But regular readers will recall research quoted by Rob McMillan in his Silicon Valley Bank report suggesting that even when they are invited to a party, wine may not be the beverage they choose to take with them.
The second reason – which is also in line with the SVB findings, is that they are simply drinking less alcohol. Christian Miller of the Wine Market Council says that the research suggests that around 20% of ‘marginal’ wine drinkers who, in 2019, reported consuming it very infrequently have simply stopped doing so at all. In 2017, 40% of the people taking part in the survey said they drank wine at least once every three months. Now, that figure is 32%.
Regular consumers – who enjoy wine, daily, weekly or monthly – have also cut back, but to a far smaller extent of between one and three percent.
Based on the survey findings, the percentage of the total U.S. drinking age population that reports drinking wine every day has declined 1% since 2019 while those who drink more than once a week is down nearly 2%, and the share of those who say they drink wine two to three times a month is down by more than 3%. The share that reports drinking wine at least once every three months has fallen from a high of 40% in 2017 to 32% in 2021. Miller said it appears about one-fifth of all marginal wine drinkers has dropped out of the category since 2019. In that year, 41% said they were cutting back on their alcohol consumption; two years later, that figure is up to 51%. Worryingly for the industry a growing number of the ‘abstainers’ are among the ‘Boomer’ generation born between 1946 and 1964 who have helped to drive the growth of the US wine industry in recent decades.
Less but Better
The one piece of encouraging news to be taken from the Wine Industry Council research is that the regular drinkers are spending more. Seven years ago, when the annual survey began, premium wines selling at $15-$19.99 were only being bought by 18% of the participants. In 2021, that figure had risen to 27% while, over the same period, the number who dug deeper into their wallets to spend $20-29.99 had doubled to hit nearly 20%.
Focus on Younger Consumer Necessary
Despite this trading-up, Miller shares Rob McMillan’s belief that the US wine industry urgently needs to focus on making wine more appealing to younger consumers rather than simply waiting in hope for them to find their own way to it.
In a world that is increasingly full of exciting low and non-alcoholic drinks, innovative spirits and craft beers, it’s a lesson that is just as relevant to wine producers and distributors outside North America.