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Sovos Announces 2018 Mid-Year Direct-to-Consumer Channel Data
  • USA - English


News provided by

Sovos

Sep 06, 2018, 13:30 ET

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BOSTON (PRWEB) September 06, 2018 -- Sovos today revealed data on the performance of the direct-to-consumer (DtC) winery shipping market through the first six months of 2018. Among the notable trends in the report were Napa County wine sales slowing but remaining steady while sales of Oregon wines rise, and Rosé continuing to build momentum after strong gains last year.

The annual DtC report is a cooperative effort between ShipCompliant by Sovos and Wines & Vines. The full version of the report is released each January. To create this report, Wines Vines Analytics created an algorithm that uses its database of U.S. wineries to extrapolate all direct-to-consumer shipments from millions of anonymized direct shipping transactions filtered through Sovos’ ShipCompliant platform.

The following results compare the first six months of 2018 to the first six months of 2017. Overall, the DtC channel showed strength. The total value of shipments rose 13 percent, above the 12.5 percent 7-year average increase. Total volume of shipments rose 12.29 percent, above the 11.5 percent 7-year average increase.

Oregon surges while Napa sees more modest growth
Among winery locations, Oregon showed 26 percent growth in cases shipped, surpassed only by Sonoma County at 29 percent. Napa County wines, meanwhile, only saw an increase in cases shipped by 0.4 percent. However, this can be attributed to a rise in the value of products shipped. While the number of cases shipped from Napa wineries did not grow significantly over 2017, the average bottle price (ABP) jumped an impressive 5 percent compared to the first six months of last year.

The year-to-date numbers for volume of cases shipped:

Sonoma County +29%
Oregon +26%
Washington +18%
Rest of US +8%
Rest of California +7%
Napa County +0.4%

Rosé builds on momentum
In terms of varietals, Rosé continued to produce strong results after making large gains in 2017. Cabernet Franc was also a big riser, and traditionally dominant Cabernet Sauvignon maintained relatively steady growth despite Napa’s less impressive performance. The final numbers for varietals:

Top performers:
Cabernet Franc +37%
Rosé +33% (continued its strong growth even after last year’s great gains)
Sangiovese +26%
Petite Sirah +19%
Sparkling +18%
Cabernet Sauvignon +9%
Red Blend +7%
Moscato +2%

Weaker performers:
Syrah -6%
Riesling -2%

Pennsylvania shows thirst for wine
Pennsylvania remained a top destination for wine, with shipments up 44 percent on volume and 40 percent by value. Pennsylvania had a breakout year in 2017 and should also be a top gainer in 2018.

Limited-production wineries show pockets of strength
Smaller wineries experienced large price increases. Most notably, Napa Red Blends saw an unprecedented increase in average bottle prices (ABP), skyrocketing 110% from $74 per bottle to $156 per bottle. This would seem to be result of club shipments to members at a handful of high-end wineries, lifting the ABP significantly in this segment.

Overall, ABP at limited-production wineries – which produce fewer than 1000 cases per year – increased by 10 percent. Other highlights in the limited-production category include:

Napa ABP increased 15%
ABP in Oregon increased 19%
Combined, Napa and Oregon shipped 52% of all cases

As a result of price increases, limited-production wineries saw the largest increase in value of any category except the largest, which includes wineries that produce 500,000 or more cases per year. The difference between the increases in value and volume among limited-production wineries is uncommon. Final numbers by winery size included:

Fewer than 1,000 cases per year: +38% Value, +8% Volume
1,000 - 4,999: +12% Value, +10% Volume
5,000 -49,999: +14% Value, +13% Volume
50,000 - 499,000: +4% Value, +4% Volume
500,000+: +42% Value, +32% Volume

The 50K-49,999K wineries have underperformed thus far after having a banner 2017. However, autumn has historically been a healthy season in the DtC wine shipping channel, so there remains plenty of time for wineries in this category to gain ground.

About ShipCompliant by Sovos
Sovos offers a nimble software solution tailored to the unique compliance obligations faced by beverage alcohol businesses. As part of the Sovos suite of solutions, ShipCompliant users have access to constantly updated, accurate regulatory information for each of the jurisdictions in which they have compliance obligations.

Sovos’ ShipCompliant platform is the leading compliance and technology platform, automating registrations, tax calculations and reporting in the heavily regulated beverage alcohol industry. With ShipCompliant by Sovos, wineries, breweries, distilleries and other beverage alcohol companies can stay ahead of the latest regulatory changes impacting their business models. Learn more at http://sovos.com/shipcompliant.

About Wines & Vines
Wines & Vines offers a comprehensive collection of products to provide a wide range of information solutions for the wine and grape industry. Its magazine, Directory/Buyer’s Guide, Online Marketing System and soon to launch Wine Analytics Report provide news, information, marketing and research capabilities to help our clients grow and manage their businesses. For more information visit http://www.winesandvines.com.

Kevin Diffily, Sovos, http://www.sovos.com, +1 +1 (978) 527 1259, [email protected]

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