U.S. restaurant wine sales still hostage to 2008 economic meltdown

January 4, 2016
In 2006, academics at Cornell University's Hotel School came up with what they thought were twenty-first century suggestions to sell more wine on-premise (in restaurants), which included pairing wine with food and low-cost wine tasting flights.

Some of us in the wine industry had been pushing those ideas-and more-as far back as the ancient twentieth century. Despite that, as we head into 2016 it appears restaurant wine sales still need a boost.

In May 2014, Paul Franson wrote an article in Wines & Vines Magazine  "Wine Losing On-Premise" the gist of which was that Millennials the restaurant industry counted on were not acting as expected. After the 2008 economic meltdown, instead of wine, Millennials gravitated toward cocktails and craft beer. According to Sandy Block, VP of the beverage program for the Legal Seafoods restaurant chain, this is when restaurants began to offer bars behind which stood hot or hunky bartenders waving their large cocktail shakers.

Block pointed out the concept that wine is best with food was not enough to stem a downward slide. Millennials who did consume wine in restaurants were more open to consuming wines that were "hot" as opposed to wines that they were supposed to pair with their toasted kale. They also sought wines with distinction or unusual flavors, which is why Sauvignon Blanc sales rose 33% in 2014 and Chardonnay sales had not.

Franson's 2014 article also quoted Sarah Schneider, wine editor at Sunshine magazine. In her view, the exciting trends to watch for in 2015 were wine on tap and the development of the wine bar into places like Starbucks.

Ms. Schneider was spot on.

According to a June 2015 article in Full Service Restaurant (FSR), wine-by-the-glass, often poured from a tap, was doing quite well in the U.S. market, from New York City to Chicago to California to Cincinnati. Two months later, Restaurant Hospitality (RH) offered tips to restaurateurs to keep wine sales flowing. One tip was to pour more wines-by-the-glass at lunch, and serve the wine from a keg.

RH stressed that no matter which label is applied to a particular generation, fine wine buyers always seem to fall between ages 35 and 55 . Restaurants needed to offer bargains that appeal to cash-strapped Millennials hit by the weak economy as well as premium wines for Generation X restaurant-goers with new cash.

Toward the end of 2015, Levi Dalton, at, claimed the so-called fast casual restaurant segment re-writes the wine list (fast casuals eschew full table service but claim to serve higher quality food than fast food restaurants). The New York City-centric Dalton covered only his home base, but he clearly supported kegs and wine in boxes as a way to keep up with demand in the fast casual category.

Dalton wrote, "At fast casual restaurants, the wine list has to work by itself." That's because these restaurants generally eschew the sommelier. Instead, they push house wines with easy names, half bottles and, best of all, wines priced lower than the traditional restaurant triple mark up.

Before fast casuals came along, a proliferation of young, hip sommeliers had taken flight. Schooled in "curating" wines that are "authentic" the sommeliers offered wines with a human story behind them, and maybe even a new color-orange wine (which is actually amber). Wine also became entertainment and the sommelier made it to television. But was this the answer?

As restaurants face 2016 and many search for a formula to increase wine sales, maybe they should look at a research study at Great Britain's University of Cambridge.

Three sizes of glasses were used over sixteen weeks in a London pub: 370 milliliters (ml), 300 ml and 250 ml. The study showed that the largest glass boosted sales by 9%.

Hmm. Who would have thought? To increase restaurant wine sales just apply a soft drink industry solution: supersize it.