Jan 20: Even as wine consumption in India is set to drop for the first time after the global meltdown, the US Consumption has also dipped by 0.9% in 2019 for the reasons that might be applicable to India as well-that younger people are experimenting more and more and switching a little to craft beer, gin and similar products, writes Subhash Arora
Consumption of wine in the US dipped by 0.9% in 2019, according to the preliminary figures released by the London based IWSR Drinks Market Analysis, the leading authority on data and intelligence on the global beverage alcohol market. This was the first time the consumption dropped in 25 years, since 1994. Despite the increase in sales of 4% in the sparkling wine market, the decrease of 1.5% in still wine sales brought about the negative growth.
Beer consumption was also down by 2.3% while cider was down even more at 3.8%. However, distilled spirits continued to gain traction with consumers and ready-to-drink (RTD) products continued their growth by a whopping 49.7%, respectively). Despite decreases in the beer category, total alcoholic beverages in the country showed a small growth of 0.3% in 2019.
The beverage alcohol industry in the US continued to innovate in 2019, especially the RTD category and came out a winner in the competition in each category to increase its share. This competition is expected to continue in 2020 as well.
The decrease has been reportedly brought in by the changing habits of the millennials. Wine represents about11% of the total beverage alcohol market in the US. Distilled Spirits showed Growth in Agave-based drinks, Whisky and Cognac. Tito’s Handmade Vodka, which increased in volume by over 20% in 2019 (vodka remains the largest spirit category by volume in the US). Mezcal showed a phenomenal growth of 40% followed by Japanese whisky (23 %), Irish whisky (8.6%), tequila (9.3%), US whiskey (5.5%), and Cognac (4%)
The US is the world’s biggest wine consuming nation, a title it has held for nearly 10 years. The decrease has been reportedly brought in by the changing habits of the millennials who are not drinking wine to the same extent as before and with decrease in consumption by the baby boomers, many of whom are now retiring.
‘We aren’t yet effectively marketing to young consumers,’ said Silicon Valley Bank (SVB) in its own state of the US wine industry 2020 report, released last week.
However, Sales of premium wines at $10 per bottle and above are still growing, even though momentum is slowing, said SVB’s report. It estimates that the premium wine sales in the US would rise by between 3% and 7% in value in 2020, based on data analysis and winery survey responses. Data already collected by SVB suggested premium wine sales were up by around 7% in value for the first nine months of 2019.
Subhash Arora
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