As I write this, I’m en route to the Caribbean for a little getaway. December is always a great time to reflect back on the year in business and in life, as well as to look ahead to trends that are shaping 2016 as it relates to the world of wine. Generally speaking, to guide the discussion, I’m perceiving trends as they relate to consumption, demographics, and service. Wine is still enjoying a steady growth in the United States, and my move to California 18 years ago next April was part of a larger plan to play a role in bringing wine to more tables in this country. I’m happy to see it happening. Let’s start there, with consumption.
Globally, wine consumption is rising by 5.3% according to the IWSR study for Vinexpo. By 2016 we will be consuming 34.48 billion bottles of wine. Interesting to note, 54.7% of wine consumption is red wine worldwide, and it shows no signs of stopping as it has increased 9% in the last five years. The Chinese population’s consumption and appreciation of wine has fueled this growth in particular. White wine has increased by about 3%. We are still in the pink, as the country appreciates dry style roses year round. That’s been a long running tradition in our home where a bottle of savory rose is always chilling for whatever meal may be concocted. We’ll be drinking 7.58% more pink wine in 2016, constituting almost 1 out of 10 bottles we drink in the United States.
Sparkling wine is en fuego. In the last four years, consumers have embraced sparkling wine and champagne as a beverage for everyday vs. special occasion. Competitively priced offerings such as Prosecco along with classics such as California sparkling wine and French champagne are up 8.52% with top consuming markets in the world being the U.S., Germany, France, and Russia.
Service of wine has had great revolutions in the last decade. Although it’s challenging from the distribution side of the business, wines in keg are becoming more commonplace, particularly in urban markets. The cost savings in packaging such as glass, cork, labels and cartons has been cut dramatically, and quality control is guaranteed with neutral gas ensuring each glass is fresh. This additional profit from the savings has helped both supplier and buyer in the wine world.
The career choice of sommelier draws in new wannabees every year with the popularity of films such as SOMM and now Uncorked on Esquire TV glamorizing the profession. Following that educational lead, both trade and consumers are eager to formalize their wine knowledge and certificate programs are experiencing brisk applications from both professionals and enthusiastic amateurs.
The Coravin, now in its second iteration has helped fatten the bottom line at restaurants as consumers who wouldn’t have purchased an expensive full bottle of wine now justify trying a taste or glass of a bottle available to them via this smart technology. Restaurants still enjoy pouring themed flights for consumers and that has now expanded from the wine flight to spirits, beer, and tea.
The millennial audience in particular has a strong affinity for international wines in terms of trial and enjoyment. They are helping to drive the interest in natural wines and wines of terroir. The regional movement of enjoying wines from a close radius continues as wine quality around the U.S. increases with shared knowledge and best practices more available than ever. Non- traditional varieties, regions and styles are the domain of the millennial audience.
On the natural wine front, winemakers are experimenting more and more with native yeasts, minimal adjustments, less new oak among other previously over-used enhancements. Look for wines that are lower in alcohol, higher in acid and pH, more moderate in terms of extraction, in other words better-balanced wines. This will take a while to become the new normal, but healthier lifestyle choices in nutrition, exercise, and beverage consumption is spreading to the world of wine. Consumers are working out before sitting down to a glass of wine and a meal. Earning the luxury is the prevailing trend.
Wine is considered a mini-luxury and we may not be taking expensive vacations or buying the most luxury cars, but we are indulging in affordable luxury and wine is a great example of that. Baby boomers are starting to retire and as their cash gets conserved for more value driven propositions, millennials do the opposite and spend their hard-earned dollars on expensive wine by the glass. Boomers still in the earning years, are of course still spending more per case than any other demographic, but look for those shifts as the millennials and Gen Xer’s emerge as the dominant demographic.
Although we like our luxuries, we are enjoying them in casual settings. Recently Starbucks has been experimenting with Starbucks® Evenings, turning the coffee shop into a lounge in the evening with offerings of wine by the glass and often live music. Wanting to capitalize on the remote office trend and virtual living room appeal of the coffee house, offering wine seems a natural way to keep customers lingering. Smashburger and Chipotle as fast casual restaurants have been offering wine by the glass in recent years signaling a sea change in the role of the fast food restaurant.
Consumers now have more on demand ability than ever. While still nascent, it's pretty amazing to be able to read online about a wine, spirit, beer or cocktail and be able to order in real time. Services such as such as Drizly, Drync and Thirstie are making quick delivery a reality for many consumers, state laws permitting. We know what we want and we want it quickly, with many services offering one-hour windows.
Some prognosticators say that craft beer is encroaching on wine’s turf with many young people opting to drink beer over wine, following the subject equally enthusiastically. At home brewers have learned how to craft their own beer and taken that knowledge to the wider marketplace increasing the number of styles of beer now in demand such as sour, seasonal or regional. I personally feel the same passion that drives beer connoisseurship, will make the translation to wine as its less filling and lower carbohydrate options become the norm with an aging population.
All in all, the next year is shaping up to be a Sweet '16 for the wine world.
A votre sante, toujours!
-Kimberly Noelle Charles
All the Swirl is a collections of thoughts and opinions assembled by the staff and industry friends of Charles Communications Associates, a marketing communications firm with its headquarters in San Francisco, California. We invite you to explore more about our company and clients by visiting www.charlescomm.com.