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Impact Databank: Sparkling Wines Defy

Gravity Amid 2020's Challenges

The total U.S. wine market is poised to register its 27th consecutive annual volume gain to yet another record high in 2020, but faced with fierce competition from hard seltzer, spirits, and other drinks sectors, as well as a still uncertain on-premise environment, the industry is expected to inch ahead just 0.2% this year, according to The U.S. Wine Market: Shanken’s Impact Databank Review & Forecast, 2020 Edition. Looking ahead, the impact of the pandemic and resulting economic downturn is projected to cause overall wine consumption to decline in value terms by year-end, and shed volume beginning in 2021, except for one segment: sparkling wine.

This year will mark the 12th consecutive annual increase for sparkling wines, which suffered a temporary setback during the global financial crisis of 2008. The current pandemic and recession notwithstanding, the sparkling segment still appears to have considerable upside as it has evolved from an occasion-driven category into much broader usage. Sparkling wine’s overall market share in 2020 is projected to be two full share points higher than just 10 years prior, according to the 252-page report.

The sparkling category is expected to continue posting modest but consistent gains until at least 2025, while all other wines are projected to shed over 2 million cases combined during the next five years.

Imports have been fueling sparkling wine’s growth for the better part of the past decade, driven by solid advances from Prosecco and Champagne. Last year, imported sparkling depletions rose 4.5% to nearly double their volume of just 10 years prior. In fact, import volumes overtook domestic sparkling wine last year for the first time ever, according to Impact Databank. Prosecco volumes in the U.S. have doubled the past five years, led by the La Marca (E.&J. Gallo) and Mionetto (Freixenet-Mionetto USA) brands. La Marca is expected to reach the 2-million-case mark by year-end, and become the largest-selling sparkling wine brand overall in the U.S. by volume, surpassing domestic labels Cook’s and Andre.

Meanwhile, Champagne brands Veuve Clicquot and Moët & Chandon (both Moët Hennessy USA) continue to lead all sparkling wines—import and domestic—in terms of retail value. Those two luxury-priced brands account for over 60% of the Champagne market in the U.S., according to Impact Databank. Among brands priced above $25 a 750-ml, Veuve Clicquot is the top overall wine brand in retail dollar terms. On the domestic end, the two largest-selling méthode champenoise brands—Korbel and Domaine Chandon—both increased share last year.

For more information and to purchase The U.S. Wine Market: Impact Databank Review & Forecast, 2020 Edition, as well as other exclusive Shanken reports and publications, click here.

David Dearie To Lead Ste. Michelle Wine Estates

In case you missed yesterday's news alert, Ste. Michelle Wine Estates has named industry veteran David Dearie as its new chief executive, replacing the retiring Jim Mortensen. Dearie was previously CEO of Treasury Wine Estates among a variety of other leadership roles across his three-decade career. Here's the full story.

News Briefs:

•Bacardi-owned Angel’s Envy has announced the 2020 iteration of its Cask Strength Kentucky Straight Bourbon whiskey finished in Port barrels. This year’s whiskey comes in at 60.2% abv and will launch—for the first time—in select retailers in all 50 states on November 1. As always, this is a limited release and only 17,400 bottles will be available, for a suggested price of $200 a 750-ml. Last year, Angel’s Envy reached 115,000 cases on 39.5% growth and was named a “Hot Prospect” by Shanken’s Impact Newsletter.

•Moët Hennessy is extending its Volcán de mi Tierra Tequila brand with a Reposado expression. The 100%-blue agave Tequila is rested for 135 days in new casks made of American and European oak. The newcomer is rolling out in select states, retailing at $55 a 750-ml. A collaboration between Moët Hennessy and the Gallardo family, Volcán de mi Tierra's other offerings include Blanco and Cristalino Tequilas.

•Heaven's Door Spirits, the partnership between Bob Dylan and Spirits Investment Partners, is launching Bootleg Series Vol. II, a new luxury Bourbon expression. A cask strength 15-year-old Straight Bourbon finished in 30-year-old Jamaican pot still rum casks and bottled at 104.6 proof, Bootleg Series Vol. II comes in a handmade ceramic bottle featuring Bob Dylan's painting, Sunset, Monument Valley, and is housed in an ornate leather journal that is individually numbered. It's rolling out in an edition of 3,000 bottles, selling at $500 apiece.

•E.&J. Gallo Winery has announced a new Napa Valley tasting room for its super-premium California brandies. The California Brandy House will initially offer tastings for Germain-Robin and Argonaut, including rare expressions and exclusive single barrel samples. The center is housed in First Street Napa, a 325,000 square foot space in downtown Napa, and will open for outdoor tastings on November 6 by reservation only. In addition to offering tastings, the California Brandy House serves as a bottle shop for the brands, offering their full portfolios alongside tasting-room exclusives.

•Lawrenceburg, Kentucky’s Wild Turkey Distillery, part of the Campari portfolio, has launched Russell’s Reserve 2003, its newest limited edition vintage release. The 44.75% abv whiskey matured for 16 years and is the last Wild Turkey juice barreled at 107 proof (today the company’s whiskies enter the barrel at 115 proof). Only 3,600 bottles of Russell’s Reserve 2003 will be available across the U.S. for a suggested price of $250 a 750-ml. The whiskey joins Russell’s Reserve 10-year-old Bourbon, 6-year-old rye, and their respective single barrel variants in the brand portfolio. Russell's Reserve was up 8% in control states in the year-to-date through August.

•Domaines Barons de Rothschild (Lafite) has appointed Philippe Rolet as general manager of Chile's Viña Los Vascos, in addition to his current post as general manager of Argentina's Bodegas Caro. In this new role, Rolet will develop DBR Lafite’s South American estates, both in the vineyards and international markets. Prior to joining DBR Lafite in 2018, Rolet spent two years at Alejandro Bulgheroni's wine group with the direct management of three Argentinean wineries and vineyards.

•Heaven Hill Brands has named Eric Hund senior vice president of U.S. sales. Hund joined the company in 2016 as vice president of sales for the Deep Eddy Vodka division. Prior to joining the company, Hund was a vice president of sales at Republic National Distributing Company in Texas. In his new role, the 25-year industry veteran will lead sales activities across the Heaven Hill portfolio.

•Winebow Imports hosted its ninth annual Women in Wine Leadership Symposium (WWLS) on October 20. Held virtually for the first time, the event was highlighted by remarks from two prominent women in the industry: Victoria James, director of beverage and partner at Cote (NYC and Miami) and co-founder of Wine Empowered; and Tonya Pitts, a sommelier, wine and food consultant, speaker, and writer based in San Francisco. The event also included a panel on sustainability and the announcement of the recipients of the Laurent-Perrier Women in Wine Leadership Scholarship, awarded by SommFoundation.

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