How Much Wine Can a Wine Consumer Consume Before a Wine Consumer Must Buy More Wine?

Sounds like a tongue twister I read once upon a time, but the truth is that if we knew the answer to this question then the wine industry would not be witnessing the sales decline we are experiencing this year. We know based on numerous consumer reports that wine consumption is up yet wine sales are down. How can that be? Well, there are many contributing factors to this seemingly impossible situation and just like most industries in this economic downturn, the wine industry is not immune to the revenue loss.

What's Going On with our consumers?

The average wine consumer is still purchasing, but not necessarily the same wine and not necessarily through the same sales channels as before. Many consumers have opted to make their purchases from lower tier wines from retail locations, that fit nicely into their newly reduced budgets. Consumers are now empowered to try those $3 - $12 wines that perhaps they overlooked in years before. Think about it for a minute. Have you been invited to a Bargain Bottle Party Recently? Well I have and to my surprise there are a lot of really great wines in this price range and there are a lot of not so great ones too. So this is contributing to the trend of luxury price point wines being down while lower tiers are up. To quote one of our clients in regards to their product sales "Viva White Zin".

Ah, then there are the loyal wine consumers who refuse to sacrifice quality and will reduce the quantity. They are willing to spend a little more to savor the wines they love, but in moderation.

Wine Collectors have been reporting that many of them are drinking from their cellars and not immediately replacing their inventory. While some oenophiles are simply waiting to see how low their favorite brands will go before making a purchase or purchasing from other collector's cellars vs. from the winery. And it's important to be sensitive, as many people including once avid wine collectors have lost their jobs or have taken significant pay cuts and are selling their collections just to pay their mortgage.

For others who really need to unwind? Well perhaps the old saying wine is fine, but liquor is quicker is holding true for them?


Not all wineries are seeing the same effects. Really? Why?

While many wineries are slashing their marketing budgets thinking they will just save their way out of this sales slump, they are actually sacrificing their overall sales numbers and brand image. Those that are maintaining and perhaps even being more selective about where they spend their marketing dollar are making smart business decisions and will be positioned to achieve faster growth when the economy does turn around.

The more sophisticated and seasoned DTC experts are in tune with their customers. They communicate to them often and in the right way. They are not relying on the same old bag of tricks that have been exhausted over the years. They are not afraid to mix it up and try new innovative approaches. They are also exercising all possible avenues of marketing and sales to get in front of their perspective consumer that make sense for their brand of course. Do their experiments always produce giant cash surges? No, but the continued effort is rewarded with steady and in several cases increased sales.

In the end stay the course, review your sales goals, be honest about your products, pricing and marketing efforts and set realistic expectations and try something new, you might be happily surprised by the results.