Domestic Wine Sales Up 9%

Retail growth rate in July rivals China's GDP

By Jim Gordon August 1, 2011
Wines & Vines
Domestic wine sales in July grew nearly as fast as the economy of China, reaching $347 million, according to check stand scan data from major U.S. food and drug stores. The four-week growth rate for wine was 9.1% higher than the same period last year, nearly matching China's 9.5% growth in GDP for the second quarter. Every four-week period during the 17 months since Wines & Vines began analyzing sales data from the Symphony IRI Group, a Chicago-based market research firm, has shown positive growth in domestic wine sales.

The pace ticked along at about 6% every month from early 2010 until early this year. But growth hit 8% in March, 10% in May, and now the 12-week growth rate has reached 9% over last year with rounding. One anomaly this year was the relatively low 2% growth in April, because the Easter holiday was celebrated in May this year. Phenomenal rate Growth has remained fastest in the highest priced category that SIRI measures-wines priced at $20 and higher per 750ml bottle. These have been growing at a phenomenal rate and continued not only to grow but to grow even faster than before.

Sales reached $14 million for the four weeks ending July 10, representing 32% growth in dollars over the same four weeks in 2010. The 52-week increase for these high-ticket wines was 22%. Wines from $8-$10.99 enjoyed the second-fastest growth rate in July for bottled wines, at 13% in dollars, while their 52-week rate was 11%. Higher priced boxed wines also have been growing rapidly: 28% in July and 26% over 52 weeks. The largest dollar category of domestic table wines includes those retailing for $5-$7.99 per 750ml bottle. This category sold $1.1 billion in 52-week sales, representing a more modest but healthy 5% growth rate. Imports adrift Imported table wines are in a different boat. If retailers aren't seeing their overall revenues rise by 9%, it may be because imports are stuck at 1% growth year-on-year, both in the recent four-week window and over 52 weeks, according SIRI's data.

This slow growth kept overall table wine sales down at 7% in July. Argentina has been the hottest import category. Its growth rate slowed from 34% over 52 weeks to 29% in four weeks. New Zealand slid slightly also, from 20% to 17%. Imports from France shrank 10% over 52 weeks; those from Australia (the biggest import country) dropped 5%, while those from Italy grew nicely at 6%. Many varietals or types varied widely in growth based on price category, but a few expanded at every price point, particularly Pinot Gris/Grigio and Pinot Noir.