The whirlwind of the Unified Wine and Grape Symposium is over now, and I'm catching up with lots of new contacts and old friends. The State of the Industry meeting was informative. As I mentioned, the economic downturn was reflected in forecasts for 2008. The wine industry has been expanding in the last several years, and things have been very positive for wineries. Sales have increased, price points have risen, new wineries have been opening up, and corporations have continued with their acquisitions.
One of the telling indicators was the data from restaurant sales. One of the best performers in restaurant sales has been Cabernet Sauvignon, often at high price points. The presenter mentioned that one of the reasons is that these wines are bought often by bankers and other executives during business meals on their expense accounts. As the economy, and specifically banking, is hit, those dinners will be curtailed by both the individual and the companies footing the expense check. There was caution expressed about sales going forward--so the wine industry is understanding that consumers may have less money to spend on special occassions, higher prices luxury items and related purchases. But consumers are buying wine in the US like never before, and younger people, namely the "millenials" are buying lots of wine.
Trends in wine drinking are reflecting the health benefit findings from 2007 of compounds in red wine. Red Wine consumptions has continued to increase. Wine drinkers are also becoming more willing to try new varietals, with lighter red wines seeing more sales, as well as different varietals including Pinot Gris and Pinot Grigio seeing big increases in restaurant purchases.
Pinot Noir is still the biggest winner in the varietal category. Merlot and blush wines are still the ugly stepchildren of the wine world. Surprisingly, as long as you are a Rose wine and not a blush wine, things look rosy for you. So those of use who like a good pink wine can drink it knowing it's still cool!
The falling dollar has also had an effect on wine sales of imports. Spain and Italy have done very well marketing to US consumers, reflected in their increased sales figures.
Although everyone is screaming recession in the popular media, indicators show continued consumer spending in wine. So smart wineries should be able to take the Unified data and make educated decisions to continue strong wine sales.
