Structure of the US wine industry 2008

Structure of the US wine industry 2008 - 4/29/2009...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
4/29/2009 1 Structure of the U.S. Industry Jim Lapsley April 29, 2009 2008: Total US wineries: 6101 Source: Wine Business Monthly Feb. 2009 Lets do some averages! 2008 U.S. sales of California wine were 182.7million cases (9L case equivalents) Wine Business Monthly reports that there are 2219 bonded wineries in California Does it then follow that the “typical” California winery produces and sells 82,334 cases of wine? I don’t think so. 2008 Top 5 U.S. Sales Gallo 67M case Wine Group 56M cases Constellation 46M cases Bronco 20M cases Fosters 18M cases Total top 5: 207M cases or 65% of all wine sold in the U.S. (317M cases) Data from Wine Business Monthly, Wine Market Council, and Impact
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4/29/2009 2 2008 Top 6 10 sales Trinchero 12M St. Michelle 6M Diageo 5.7M Jackson Family 5M Brown Forman 4.5M Total 6 10: 33.2M or 10.5% of all sales 2008 U.S. Sales Top 5 207.0M cases 6 10 33.2M cases 10 20 14.1M cases 20 30 47M case 20 30 4.7M cases Total top 30 259.0M cases Total Sales 317.0M cases Percent top 30 81.7% 6071 bonded/virtual wineries plus imports chasing 18.3% of the market Until 2009, the trend was to more expensive wines Trend was a decline in consumption wines under $7—although still >60% of volume $10 15 was experiencing Wine Market Growth is Dominated by Middle & High End Priced Wines 25 30 35 $10 15 was experiencing strong growth—”$15 is the new $10” $9 $11.99 up 12% $12 $14.99 up 16% >$15 up 11% 0 5 10 15 20 2004 2005 2006 2007* In Bilions < $8 $8 - $15 > $15 MKF Data
Background image of page 2
4/29/2009 3 Varietal Trends in Supermarkets (Nielsen Data Sept. 2007) Variety % Volume Dollars Growth Volume Growth Dollars Chard 20 23 1% 2% Merlot 11 12 5% 3% Cab. S. 10.5 14 15% 12% 41.5% 49% Frequency of Purchase by Price Point, 2006 75% 53% 17% 42% 34% <$3 $3 - $6 $6 - $10 $10 - $15 $15 - $20 >$20 Source: Merrill Research New Brand Introductions Wineries responded to the new market by introducing newer (and more expensive) brands 63% of brands have been introduced since 1999 Result: fragmentation and decreased dominance of any one brand Result: increased competition for retail space Since 2000 the market has been flooded with new brands 2,500 3,000 3,500 4,000 0 500 1,000 1,500 2,000 1999 2000 2001 2002 2003 2004 2005 2006 EXISTING Brands
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 09/29/2010 for the course VEN 101C 91861 taught by Professor Davidsmart during the Spring '09 term at UC Davis.

Page1 / 11

Structure of the US wine industry 2008 - 4/29/2009...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online