Shift in Wine Distribution Channel Means Agency Opportunity

The US winery market continues to enjoy good times with a shipped product value of $12.5 billion in 2007. This figured translated into a retail value of $25.43 billion and when added to the value of 2007 imported wine of $4.57 billion, the US represents a $30 billion total wine market.

Small wineries are increasingly selling in the direct to consumer market as changing legislation has shifted the traditional channel for alcoholic beverage distribution. Wine Business reports the following 2007 breakout for channel sales of wine:

  • Trade 57%
  • Direct to consumer 38%
  • Exports 5%

To sell direct to consumers, wineries are turning to tasting rooms and wine clubs. However, revenues from tasting rooms are closely linked to winery size. Mid-​size wineries which produce between 5,000 and 49,000 cases annually expected to report revenues of 35% (Western) and 60% (non-​Western) from these rooms in 2008. Large wineries which produce 50,000+ cases annually project tasting room revenue of 20% (Western) and 40% (non-​Western) in 2008.

Direct to consumer sales represent a growth channel for small wineries. If new wineries have opened in your market, it may be time for your agency to pitch a new direct-​to-​consumer campaign.

[Sources: Fisher, Cathy. "Wineries Continue to Harness Power of Tasting Rooms," Wine Business Monthly. 05.15.2008; Berglund, Lesley. "2008 Consumer Direct Sales Survey Report", Wine Business, 8.15.2008; Wine Industry Report, International Trade Association, 2008 ] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.