Consumer Demand Shapes DTC Wine Industry in 2016

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What has consumer demand taught winery teams this past year?

As we kick off 2016 and review data just released from Wines & Vines in the ShipCompliant report, we know that the total value of winery-to-consumer shipments increased 8.1% to almost $2 billion last year. The average price decreased from $38.40 in 2014 to $38.23 in 2015. DTC wine sales growth outpaced that of the retail wine marketplace with 8.5% volume growth exceeding the 2.2% growth of the retail off-premise wine volume, according to Nielsen. Sixty-seven percent of all wine shipped in 2015 fell into the $40 and Under Category. The $15 and under category saw a 27.7% increase in volume of shipments in 2015, bringing its share of shipments to 22.5% – the highest share of any category. Over half of the $1.97 billion worth of wine was shipped to five states in 2015: California, Texas, New York, Florida, and Illinois. Knowing the make up and buying patterns of a winery’s customer base provides the management team with tools and insights to better connect the direct to consumer wine portfolio to audiences most interested in the corresponding varietals and price points.

What have we learned about top varietals shipped to consumers by region? We saw that Cabernet Sauvignon was still the top direct to consumer seller. Yet in California, where Cabernet Sauvignon experiences the largest amount of its sales, Pinot Noir was the most commonly shipped varietal to California residents. Pinot Noir accounted for 16.9% of all shipments. So while a winery may be based in California “cab country”, we have learned that consumers want more of what they like, regardless of where they live.  While it is easy to buy plenty of great cab in the Napa Valley, Californians don’t have any problem buying online from wineries out-of-state. This also goes the other direction when we look at the cab collectors in Texas who love to have wines shipped from wineries in California.

What have we learned about the top Ship-To-States? More than half of the $1.97 billion worth of wine was shipped to five states in 2015: California, Texas, New York, Florida and Illinois. WE KNOW that consumers in these five states are well-versed at receiving wine shipments and are comfortable buying online.  California continues to outpace other states, receiving 31% of the total volume of wine shipped.   

What did we learn about online wine buyers by age group? According to the State of The Wine Industry Report published by Rob McMillan on January 21, 2016, “Baby Boomers”, who have dominated the wine business over the past twenty years are moving more and more into the “Matures” age demographic and DTC spending has declined. By 2021, “Gen Xers” will begin to move into the dominant fine wine consumer in the mix of consumers by age range. For the first time, the “Millennials” consumption habits have passed the mature generation, representing 16 percent of fine wine consumption. According to a 2014 study from Wine Market Council, 29% of US wine drinkers are aged 21-34 and millennials are the most adventurous drinkers. Exploring wine may seem overwhelming for many but millennials use technology to learn about this sector. Millennials are all about research and rely heavily on peer reviews, wine apps and custom choice wine clubs instead of expert recommendations and ratings systems. Earlier this week, the Wine Market Council (WMC) presented findings from its 2015 survey of Americans as to who drank wine, how often did they drink and how much they drank when they did. Overall, millennials consumed about 2.5 percent more wine in 2015 than the year before at 42 percent of total wine sold (160 million cases).

How did E-Commerce sales as a whole wrap up nationally in 2015? Adobe Digital Index calculated that shoppers spent $2.74 billion online on Black Friday, an increase of 14.3 percent over 2014. There were $905 million in mobile sales, representing 33.2 percent of all sales compared with 27 percent in 2014. Email marketing was the primary channel driving online sales, accounting for 25 percent of transactions. Social media drove a disappointing 1.7 percent of sales. Adobe reported that $3.07 billion was spent online on Cyber Monday, a 16 percent increase over last year, with 26 percent of sales at $799 million originating from mobile devices. Mobile Commerce is now 30% of all U.S. E-Commerce according to a study published in Practical E-Commerce.


1. Give customers more of what they want and cross-reference transactional data against industry reports to tighten up direct to consumer offerings in 2016.

2. Market more of what consumers want to the right audiences in the right regions using data analytics and customer feedback to shape the overall direct to consumer sales and marketing strategy. Don’t ignore millennials and be sure to stay on top of Gen X wine buying behaviors.

3.  Reach direct wine consumers where they want to buy in the Mobile E-Commerce space. Be sure that your online store and DTC marketing campaigns are mobile-friendly. Study mobile e-commerce trends as it relates to the wine industry and then study two complimentary industries such as travel and luxury goods. Get creative with DTC marketing messages and invitations to return for elevated experiences at the winery or valuable experiences at the online store.

To learn more about DTC Wine Workshops and direct to consumer strategic planning services, contact: [email protected] or call (707) 681-5120. Also, find out how wineries are responding to consumer demand with implementation of new technologies and internal processes by viewing the DTC Case Study Series HERE.


About Sandra Beals

Sandra Beals, founder of DTC Wine Workshops and the DTC Consultant Network, is a subject matter specialist and public speaker on the topics of direct to consumer wine sales and consumer engagement strategies.