DtC Volume Down 9%, And That Means Normalcy Is Returning

That’s what Sovos ShipCompliant and Wines Vines Analytics says in their latest report, anyway. We think they are correct.

The overall volume of wine shipped across the country so far this year is down 9% from the same period in 2021, at 3.7M cases, the total value is up 3%, at $1.95 billion, ShipCompliant says. But again, this reflects a return to normal trends after a 2020 that saw a tremendous 27% increase in volume.

“The decline in volume is not that unexpected considering the record highs of the previous two years, seasonal patterns and the recovery of the on-premise sector where consumers are back to buying wines they may have been purchasing via DtC,” said Andrew Adams with Wines Vines Analytics. “And while it’s very encouraging to see shipment value remain positive, there is growing concern among wineries that challenges in the wider U.S. economy may hinder value growth through the second half of the year.”

Here is a deeper look at the changes in the DtC shipping channel between January and the end of June, 2022.

Average bottle price

Average bottle price has climbed to $43.78, an impressive 14% increase. Interestingly, the regions with the highest priced bottles also showed the biggest increases in price from 2021 to 2022. The average price of a bottle from Napa is now $79.74, an increase of 20%. Sonoma, Oregon, the Central Coast, Washington and the Rest of California also saw an increase in bottle prices. The average bottle price from wineries in the remainder of the U.S. was down 3% from the first half of 2021, averaging $21.78.

Destination state

California is once again the top destination state, producing and shipping the most wine. The top destination states in descending order are California, Texas, Florida, New York and Washington. The top five destination states have remained the same since Pennsylvania fell from the fifth spot last year. Of the states listed, Florida saw the largest value change in wine shipped, with an increase of 13%.

Aside from California, the remaining top four states each averaged 6% of total market share.

Winery location

California wineries outside of Napa, Sonoma or the Central Coast experienced an 8% increase in volume shipped, with the rest of the country seeing a reduction in volume growth. This area has shown consistent growth since 2019 and now makes up nearly 12% of the total volume of wine shipped in the country. When comparing the first half of 2022 to the same six-month period in 2019, the Central Coast is the only region with flat shipment volume.

Winery size

Reflecting a return to more in-person and carry-out sales, wineries of all sizes experienced a drop in volume from 2021 to 2022 at the mid-year. Volume dropped the most among wineries producing under 1,000 cases per year (down 15%), followed closely by wineries producing 5,000 to 50,000 cases per year. The smallest drop was among wineries producing 1,000 to 5,000 cases.

Wine varietal

Cabernet Sauvignon, holding the largest share of overall sales by varietal (29%), saw a 1% decrease in volume from 2021 to 2022 at the mid-year, but a 17% increase in value. Red Blends, with the second largest share, saw an 11% decrease in volume and a 7% increase in value. The varietals leading the way with average bottle price growth are Red Blends (21%), Cabernet Sauvignon (19%) and Merlot (16%). Only Pinot Gris saw negative bottle price performance (-8%).

Moscato saw impressive growth in volume (48%) and value (57%) compared to last year—though notably, Moscato is growing on a small sales base, with the lowest overall sales among varietals tracked. The only other varietal group with growth in volume has been Syrah/Shiraz, with a 3% increase.

The largest decrease in volume growth were White Blends (down 22%), Petite Sirah (down 20%) and Rose´ (down 19%), with Sangiovese, Riesling and Merlot following closely behind.

What’s next for DtC wine shipping?

Wine consumers who found their way to the DtC channel in the last two years appear to be staying put, and wineries are once again benefiting from a reversion to pre-pandemic buying patterns, reflected in increased volumes of higher-priced wine sales.

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Yuengling Continues Support of University of South Florida’s Brewing Arts Program

Yuengling announced the continuation of its partnership with the University of South Florida’s St. Peterburg campus (USFSP) Brewing Arts Program with a $10,000 donation for its two longstanding scholarship opportunities, the Diversity in Brewing Scholarship and Yuengling Veteran Scholarship.

The Diversity in Brewing Scholarship, which was awarded in February, is given annually to an individual from a traditionally underrepresented population and covers the cost of tuition to USFSP’s Brewing Arts Certificate program for the upcoming spring semester. The Yuengling Veteran Scholarship provides one veteran with full funding to attend USFSP’s Brewing Arts program, continuing the brewery’s long-standing support of the military and veteran communities. This scholarship will be announced prior to the program’s August 2022 session.

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Round Barn Winery Intros Espresso Cream

In celebration of its 30th anniversary Round Barn Winery, Baroda, Mich., has announced its newest addition, Espresso Cream, to its award-winning wine-based creams. The Espresso Cream will join the Black Walnut Cream and seasonal Salted Caramel Cream and Mint Chocolate Cream.  The Espresso Cream contains 14% alcohol, 17% residual sugar and pairs nicely with ice cream, hot or ice coffee, vodka, and cinnamon buns.  SRP: $29.

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F.Y.I. —

How Polio Crept Back into the U.S.

U.S. public health agencies generally don’t test wastewater for signs of polio. That may have given the virus time to circulate silently before it paralyzed a New York man. (ProPublica)

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Cocktail Sales Add $13,000 to Average On-Premise Outlet’s Sales in Quarter

Performance in the most recent quarter of this year sees the average outlet earn over $13,500 from cocktail sales, which is an +11% increase from the first quarter, according to CGA by NielsenIQ‘s Cocktail Sales Tracker. While average prices are up +4% from the previous quarter, average check value is down -1%. This increase in sales velocity can be solely attributed to traffic, which sees a +14% rise. This is good news for On Premise retailers and suppliers, CGA says.  

Exploring daily performance across the week, data highlights that Saturday, as expected, saw the largest velocity on average ($3,300) but interestingly all the growth occurred on the other days of the week – with midweek preforming particularly well, (Wednesday and Thursday having a +22% and +24% velocity increase respectively). Early evening and late night were the best performing dayparts compared to the previous quarter (+15% and +20% respectively), as the days become longer, and consumers choose to stay out that bit later. 

As we enter the summer months, research suggests that consumer cocktail preferences change – the Mojito has overtaken Old Fashioned as the fourth most popular cocktail this quarter. However, the biggest jump in the top 30 cocktails is with Piña Colada, which moved from the 17th to 9th most popular cocktail type, with an +87% increase in traffic. This rise is most pronounced in New York, specifically in the last 4 weeks of the quarter.  

This trend is maintained when considering total cocktails by state.  In the first quarter, warmer states like California and Nevada recorded the highest velocity and, while they are still on top in the second quarter, this gap has been shortened with Illinois (+37%) and New York (+28%) heating up and performing best vs Q1. Again, this boost is driven by traffic with Illinois seeing an increase of +43% and New York an increase of +29%.  

Interestingly, Illinois and New York do not follow the total U.S. trend for dayparts – Breakfast/Brunch experiences the highest growth in both states in the second quarter (+95% and +33% increase in velocity), where Bellini’s and Mimosa’s are the top two cocktails. Knowing how each market reacts to the seasonal changes can help suppliers identify areas of opportunity and target consumers more effectively. 

 Matthew Crompton, CGA’s regional director – North America, said “The changing dynamics of consumer preferences are coming through in the cocktail tracker. The Summer presents ample opportunities for beverage suppliers to maximize these shifts in preferred serves to compliment occasions and changes in the weather – and understanding these trends will be key to building a winning cocktail strategy in the On Premise.”  

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Black Velvet Launches Black Velvet Peach

Black Velvet, the second-largest selling Canadian whisky, announced today the launch of Black Velvet Peach to its portfolio of flavored whiskies. The new flavor will be available this August in stores across the country.

Black Velvet Peach blends the fresh and sweet taste of peaches with smooth Black Velvet whisky. The rich, amber-colored whisky promises to be a keen pick for peach lovers and whisky fans alike. As the fastest growing flavor for brown spirits, Peach is a natural addition to already popular flavor expansions, Black Velvet Apple and Toasted Caramel.

“Whether you’re tasting Black Velvet for the first time, or you’re a loyal fan of the brand, we feel confident Peach will be a hit with consumers,” said Molly Vincent, Heaven Hill Senior Brand Manager. “We’re excited to continue to expand upon our flavor offerings —and with one of our hottest summers coming to a close, we feel this refreshing addition couldn’t have come at a better time.”

Since tapping their first barrel in 1951, the Black Velvet team has earned its reputation for crafting first-in-class whisky. Headquartered in Lethbridge, Canada, the company credits crystal clear Canadian water and the freshest grains for their whisky’s iconic smooth taste. Black Velvet is now available in 55 countries, and the brand continues to expand the with strategic brand extensions to appeal to a growing audience. Black Velvet was awarded Whisky Value of the Year for the Export Market at the 2022 Canadian Whisky Awards.

Black Velvet Peach will be supported by point-of-sale displays and tastings in some retail locations. Bottled at 70 proof, the product will be available in 50 ml, 750 ml, and 175 ml sizes with an SRP of $10.99 for the 750ml.

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