Wine Consumers Thirsty for Other Beverages
Sobering data from Wine Market Council paints wine drinkers as fickle
Napa, Calif.—The Wine Market Council made its 10th annual presentation about U.S. wine consumer trends Feb. 6 in Napa. John Gillespie, president of the group, presented a summary of surveys answered by wine consumers, particularly those who drink wine frequently.
The findings included some disquieting trends for wineries among wine consumers, particularly drinkers in the critical high-frequency and high-end segments.
Gillespie noted that the adult U.S. population has grown from 134 million in 1970 to 228 million in 2013, an increase of 70%. During that time, wine consumption grew from 1.91 gallons to 3.14 gallons, a 109% rise in spite of a dip around 1990.
In August 2014, ORC International surveyed a representative sample of all U.S. adults adjusted to current Census Bureau demographic data to segment consumers into non-drinkers, beer and spirits (but not wine) consumers, all wine drinkers, and high-frequency wine drinkers. They obtained 2,920 completed surveys.
The surveys determined that 36% of the population are abstainers, 27% occasional drinkers, 24% non-adopters (don’t drink wine) and 13% high-frequency wine drinkers.
Among wine drinkers, 33% are frequent wine drinkers (several times per week, or daily), and 67% are occasional wine drinkers. Nineteen percent of wine drinkers say they only drink wine, 19% drink wine and spirits but no beer, 20% drink wine and beer but no spirits, and 42% drink all three.
Interestingly, women outnumber men as wine drinkers 54% to 46%.
By generation, 41% of baby boomers drink wine, followed by 29% of millennials, 18% of Gen X and 12% of older people.
Wine consumption has risen 14% among high-frequency drinkers in the past two years, but it has dropped 13% among occasional drinkers.
High-frequency consumer survey
The next part of the survey focused on high-frequency wine consumers. The survey of 1,001 high-frequency wine drinkers was conducted by Illuminate Research of Seattle, Wash., with a sub-segment of 321 high-end wine buyers. The respondents were provided by the Survey Sampling International panel of U.S wine consumers and focused on the wine-drinking population.
Of respondents, 80% were Caucasian, 8% African-American, 6% Asian-American and 5% Hispanic. By income, 45% made $50,000-$100,000 per year.
A quarter of high-frequency wine drinkers drink daily; the rest a few times a week, with 16% each for those with an income of $35,000-$50,000 and $100,000-$150,000. High-frequency wine drinkers are split evenly by sex.
Baby boomers make up the largest share of high-frequency wine drinkers (38%), while millennials trailed behind, making up 30% of high-frequency wine drinkers.
Fifty-six percent of young high-frequency wine drinkers are female, but they make up just 51% among older, high-frequency wine drinkers.
High-frequency wine drinkers don’t just drink still table wine, either. Thirty-five percent report drinking sparkling wine at least once per month; 29% drink flavored wine; 24% drink wine coolers, and 24% consume dessert wine.
These enthusiastic wine drinkers consume 68% of their wine at home, 15% at a restaurant or bar, 13% at someone else’s home and 4% at other venues.
The portion drunk at home rises linearly with age, while the other locations drop similarly.
Where do frequent wine drinkers buy wine?
As far as the price of wine purchased (see chart at top), frequent wine drinkers who buy weekly commonly pay $5 to $15 per bottle, with those buying monthly extending that to $20 per bottle.
The most popular package is the 750 ml bottle, with 84% buying them monthly or weekly. Thirty-seven percent of frequent wine drinkers buy 1.5-liter bottles monthly or weekly.
Among high-end wine buyers who frequently purchase wines priced above $20, 87% also frequently buy wines under $20; 43% occasionally buy wines under $20, and 38% even frequently buy bag-in-box wines.
One of the most interesting questions was whether high-frequency wine consumers pay attention to reviews. The highest number (31%) considered them somewhat important, while 13% said they were extremely important and 16% said not important at all.
Among the frequent drinkers, millennials depended most on reviews, with 56% considering them very or extremely important, with figures dropping by age. Forty-two percent of Gen Xers said reviews were important, 21% of baby boomers and only 15% of those age 69 and above felt reviews were important.
More to the point, 63% of high-end wine buyers consider reviews extremely or very important, which only 22% of other buyers do.
The study found that 93% of California’s high-frequency wine drinkers have tasted wine from their state, but only 64% of residents of other states could say the same.
In the study, 89% of high-frequency drinkers have bought California wine in the past three months, 33% Washington wine, 31% Oregon wine and 29% New York wine. Meanwhile, 17% had bought Virginia wine, 16% Texas wine, 14% Michigan wine and 10% Missouri wine.
Not too surprisingly, Californians have a higher opinion of the state’s wines than other frequent drinkers do: 63% of Californians rate the quality of the state’s wine as excellent, 29% good. For others, the figures are 44% and 45%. All rate its value below its quality.
When you look at imports, high-frequency wine drinkers favor Italian and French wine, as demonstrated by purchases within the past three months:
Younger consumers are tied to social media, and the study found that 62% of millennials and 40% of Gen X consumers use Facebook, 38% and 21% Twitter. Still, 46% of Gen X and 25% of millennials don’t use social media.
Beer vs. wine
Beer, craft beer, spirits and hard cider are increasingly seen as competitors to wines, particularly among younger drinkers and at lower price points. The survey asked high-frequency wine drinkers about their consumption of those beverages, too.
They found that 69% of frequent wine drinkers also drink beer frequently, 16% daily, 53% several times a week, 18% once a week, and 13% less often.
Likewise, frequent wine drinkers like spirits, and 52% also drink spirits frequently. Of these drinkers, 9% drink spirits daily, 43% several times a week, 26% once a week and 22% less often.
Not surprisingly, younger frequent wine drinkers also drink more beer. Ninety-five percent of millennials, 94% of Gen X and 78% of baby boomers drink beer at least once per week, while 83% of older drinkers drink beer weekly.
The numbers are lower for weekly consumption of spirits, 88% of millennials, 77% of Gen X, 71% of baby boomers and 76% of those over age 69.
High-frequency wine drinkers also report that they’re drinking more beverages other than wine than they did a year ago: 56% craft beer, 49% imported beer, 43% conventional domestic beer, 41% flavored malt beverages and 32% cider.
More than half (54%) of the high-frequency wine drinkers report that they’re drinking more beer when they used to drink wine. 43% are drinking more spirits when they used to drink wine.
In sum, the information reported by the Wine Market Council’s survey of high-frequency wine drinkers shows that craft beer and spirits—even cider—are often being chosen instead of wine. This reinforces data presented by many other observers. Do wineries care? And are they willing to do something to counter the trend, even adopt industry-wide marketing programs that like those that have benefitted avocados and raisins?
In the second part of the presentation, Danny Brager, vice president group client director of Nielsen’s Beverage Alcohol Team, offered extensive analysis of trends, which is available to Wine Market Council members.
