Direct-to-Consumer Wine Sales See a Spike

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Although we recently reported that millennials are drinking less wine than the baby boomer generation, direct-to-consumer (DtC) wine sales have increased by 12 percent in 2018.

According to the 2019 Direct to Consumer Wine Shipping Report by Sovos and Wines Vines Analytics, consumers are also willing to buy more expensive wines directly. The average shipped wine bottle price spiked by 2.4 percent.

So why the rise in these sales? Well, thanks to e-commerce giants, buyers now expect direct shipping on most products. So why not from their favorite winery too?

“The direct-shipping channel has matured into a mainstream option for wineries to meet growing consumer demand,” said Larry Cormier, general manager of ShipCompliant by Sovos, in a press release. “As buyers continue to prefer direct shipping of all the products they buy, this channel must rely on organic growth, not new states opening for shipments. As a result, we anticipate strong but slower growth in the years to come.”

Most of today's wine sales are on-premise, but of the $30 billion in sales made from off-premise wine sales, DtC accounted for 10 percent.

Back in 2012, DtC wine sales were $1.5 billion. Fast forward to today and the sales have more than doubled.

Napa County wineries are shipping the most wine in the country with 45 percent of shipments coming from this region. The average price of wine from this region spiked by 7.1 percent last year, which means wine prices are expected to decrease come 2019, especially as the market becomes more saturated with more affordable wine options.

“This may be an early indicator of what’s to come for the whole channel in 2019, as price increases have historically been followed by flat or declining prices the following year,” said Klingensmith, publisher and president at Wines Vines Analytics.

Learn more about the 2018 DtC wine trends at "Wine Business" now.

Want to know what 2019 will bring when it comes to wine? Listen to this recent episode of The Barron Report below where Host Paul Barron talks with Emily Wines, master sommelier & vice president of wine and beverage experiences at Cooper’s Hawk Winery & Restaurants about the new era of wine drinkers.