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Todd Sheppard
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Live Oak Bank

Wine Sales Skyrocket! Is it Obama & Optimism? – Part 1

In the midst of a global recession with one gloomy report after another, wine sales for the four-week-period ending January 25, 2009 (0ver the same period in 2008) have shot through the roof. According to data from Information Resources, Inc. (IRI), table wines sold through U.S. food and drug stores increased 6.4 percent overall  and sparking/Champagne soaring with a 39.5 percent increase.

The data reverses a series of steady bad news delivered in previous reporting periods.

OBAMA + GLOOM FATIGUE = BIG SALE INCREASES

Celebrations of the election of Barack Obama probably accounted for a big increase in the consumption. In addition, IRI Vice President Doug Goodwin said, “people realized that despite all the gloom news in the media, the sky han’t fallen in. I think consumers decided they needed to kick back and enjoy themselves.”

GREAT NEWS ACROSS THE BOARD

IRI’s numbers showed many varietals and price categories — especially value brands — displaying double-digit dollar volume increases.

Click image to enlarge

Click image to enlarge

VALUE AND ULTRA-PREMIUM RACE NECK-AND-NECK

Not surprisingly, value brands led the way with box wines costing more than $2 per 750ml equivalent posting a 40.5 percent gain. But even more significantly, every other price category also showed substantial increases. As the enlarged version of the table, below, shows, 750ml wines costing more that $20 and box wines under $2/750ml both increased 9.2 percent.

Click to enlarge

Click to enlarge

IRI PRICE POINT SEGMENTS

Key to IRI Price Points

Key to IRI Price Points

Non-varietal domestic table wines in 1.5 liter bottles increased almost 16% while every other category showed increases except 1.5-liter imports.

ARGENTINA, WASHINGTON LEAD INCREASES

While California posted a respectable 7.4 percent increase, Argentina topped the chart with a 44.4 percent increase. Washington state wines showed the greatest domestic growth, with dollar volume climbing 13.5 percent.

Click to enlarge.

Click to enlarge.

MORE MICRO-ANALYSIS OF DATA IN NEXT INSTALLMENT

The next installment of this multi-part series will take a more micro-look at the data by varietal, price-point and size category.