Young Drinkers ‘Trading Up’ To Pricier Wines
on 18/01/11 at 9:23 amIndustry
San Francisco wine collector Julie Crabill canceled more than half of her eight wine-club memberships during the recession. Now that the economy is recovering, so is her spending.
“Because we wanted to save money and because we felt like it was the responsible thing to do while everyone else in the world was tightening their belts, we cut back,” said Crabill, 34, who runs marketing communications firm Inner Circle Labs with her husband, Jon Neri. “Toward the end of 2010, we added August Briggs, which is a pinot house, to our roster, and Domaine Carneros champagne.”
The wine industry expects fellow drinkers will follow suit. Sales of bottles over $20 slumped during the past two years, as consumers flocked to cheaper alternatives. Now, as the economy recovers, consumers are starting to spend on pricier bottles. That bodes well for winery owners such as Constellation Brands Inc. and Diageo Plc.
“I saw a lot more champagne sales this holiday season,” said Amy Currens, sommelier at Prospect, an upscale restaurant in San Francisco’s South of Market neighborhood that serves, on average, 260 diners a night. “People are willing to spend money again. They’re not completely shying away from it like they were last year.”
Total U.S. wine sales rose 4.1 percent to $9.32 billion for the 52 weeks ended Dec. 11, according to the most recent data from Nielsen Co. The fastest-growing segment was wine priced at $20 and up, with sales gaining 11 percent. Wines under $3 declined 0.6 percent.
“What we’re seeing is that people are trading up from value wines,” said Jay Wright, president of the North American wine unit of Constellation Brands.