The U.S. wine business continues to suffer losses.
SipSource, an industry statistics firm, reports that wine sales in the United States fell by 6% last year compared to 2023. The decline is the most recent in a long-term trend of declining demand for wine in bars, restaurants, and retail establishments, which some are seeing as an existential threat to the sector.
Sales of beer, cider, and spirits have also declined, according to NIQ data, proving that wine is not the only alcoholic beverage that has suffered. However, the decline in wine is more severe, and the entire business is aware of this.
According to Larry Duke, who has owned and run Schumer’s Wine and Liquor in Manhattan since 1978, wines had been rising steadily for years, but in recent years, they have declined.
Lockdowns brought on by COVID-19 and instructions to stay at home boosted demand for wine in 2020. However, that surge has turned out to be short-lived.
The decline in wine consumption can be explained by generational patterns, according to wine industry expert Mike Veseth, author of multiple publications and The Wine Economist magazine.
According to Veseth, the baby boom generation loved wine. We thought the succeeding generations would continue to do it, but they haven’t.
That theory was supported by a Gallup study conducted in 2023, which revealed that younger Americans drank less than older generations.
A second Gallup poll from August indicates that over 40% of Americans now believe alcohol is unhealthy, which coincides with the decline in demand. Alcoholic beverages should have cancer warning labels, according to a report released by the U.S. surgeon general on January 3.
According to experts, younger consumers tend to choose premixed, ready-to-drink choices when they do indulge. Premixed drinks are actually one of the few sectors of the alcohol industry that is expanding.
Compared to the convenience of premixed drinks, wine, which comes in a huge bottle and may require a corkscrew or extra glasses, is at a disadvantage.
According to Christian Miller, research director for the nonprofit organization Wine Market Council, which focuses on research, it’s not that they don’t like wine. The reason is that they are consuming a far greater range of other beverages.
The legalization of marijuana has also reduced demand for wine, according to Gary Decker, proprietor of Vinomania in Syracuse, New York.
“It’s just another piece of the party puzzle, so it’s taking a big chunk out of it,” Decker said. It is an additional action that people can take.
Spirits and beers without alcohol are another barrier. Sales in the industry have significantly increased recently, according to industry data.
Nonalcoholic beverages are beneficial for businesses that provide them as well as for people who are concerned about the health dangers associated with alcohol.
According to Bump Williams, who has at least thirty years of experience in the alcoholic beverage sector and owns a consulting firm, retailers adore them. A merchant can provide a customer water if they notice that they have had too much alcohol, but they won’t profit from it. They could serve them a mixed cocktail that isn’t alcoholic instead.
Nonalcoholic wines are still lagging behind.
According to Veseth, the market for de-alcoholized beer is expanding and the best de-alcoholized beer is of very high quality. Wine is falling behind.
How can the flavor be replicated? questioned Dale Stratton, a seasoned professional and managing director of a wine-related consultancy. I simply haven’t come across a system that accomplishes that in the wine area.
One of the priciest types of alcohol and one that has been rising in price is wine. The average price of a liter of wine has gone up from $10 to $14 since the turn of the century.
According to Veseth, people’s budgets are just very limited these days. Wine is therefore feeling the pinch.
Although analysts disagree on how severe the problems will be, these elements point to difficult times for the wine business.
Veseth stated, “This is not business as usual.” The issue is existential. The industry will continue, but significant changes are required to make it happen.
“Wine has always existed,” Stratton added. The wine category will remain in existence. And although though we are currently dealing with some difficulties, the wine category has existed and will continue to exist.
Winemakers aren’t prepared to give in, even though the business may be taking a while to adapt to these difficulties.
Should an 8,000-year-old human beverage be retired? remarked Martha Stoumen, the proprietor of Martha Stoumen Wines and a winemaker from California. Really? Will we allow it to become extinct? It appears that as a culture, we might want to consider that.