A Closer Look at the Direct-to-Consumer Wine Shipping Market

As the pandemic forced restaurants and bars across the country to close and leave customers eating alone at home, more wine than ever was ordered online last year. While much of it has been purchased at outlets, many wine lovers also choose to pick up bottles from their favorite winters. The direct-to-consumer (DtC) wine sales channel has long been the most profitable way for a winery as wholesalers and retailers do not seize their profit margins.

The Direct-to-Consumer Wine Shipping Report, one of the largest and most comprehensive reports in the DtC channel was published this morning. This report is an annual collaboration between Sovos ShipCompliant and Wines Vines Analytics. It analyzes DtC shipment data from more than 1,100 U.S. wineries to users over each month, making up more than 40 million people over the year. The DtC channel, like all other commercial sectors, was severely disrupted in the chaotic year of 2020 but also benefited greatly from the stay-at-home orders throughout of the country. Here’s a closer look at some of the details.

The hard numbers

The DtC sales channel grew a staggering 27 percent in 2020 over 2019, unprecedented in the 11 years this report was published. That same year, windai sent 8.39 million cases of wine to customers. As the size of the load grew, the value did not keep up at the same pace. That’s because “consumers are returning to wine at a lower price. The average price per bottle of wine dispatched in 2020 dropped 9.5 percent to $ 36.83 per bottle. Finally, while a 27 percent increase in the amount of wine served to consumers looks like a positive development for the wine industry, it doesn’t tell the whole story. The increase in the volume of wine brought from wines to consumers in 2020 is both a mask and is in response to a sharp overall reduction in visits to wineries, tasting rooms and restaurants, ”notes -near to the report.

While shoppers sought new wine stores, wineries increased their online sales focus. Many pulled out all the stops with digital marketing and Zoom taster. However, cautious consumers brought prices down 9.5 percent in the 2020 average price for each bottle sent out for winters, the highest number seen in the past 11 years.

Ironically, “both the largest and smallest wine production sectors saw the largest increases in shipments in 2020, largely due to price cuts. Wineries exporting 500,000 cases or more each year saw a 54.7 per cent increase in the number of vessels on their 17.3 per cent reduction in the average price per bottle disposed of, ”according to the report. report. At the same time, windai making 1,000 cases or less each year increased the number of vessels by 64.9 per cent, reducing the average price per bottle disposed of 16 per cent. ”

In the DtC game, Washington State continues to do too much. According to the report, the most impressive data was “the 24.1 percent increase in the value of Washington State wine shipments at an average bottle price of $ 33.74. In fact, Washington State windai has been standing in the wine shipping channel for five straight years. Although representing only 4.9 per cent of the DtC shipping channel size, the sector has increased the value of shipments year on year with 168 per cent growth since 2015, down all other areas. which is covered in this report. “

Prices and Shares

Consumers were targeting bottles at an affordable price. As a result, shipments of wine at a price below $ 30 per bottle increased, while sales of wine at a price of $ 100 or more per bottle slowed down. Cabernet Sauvignon, a long-time consumer favorite, had declined in sales due to its very high price point. At the same time, “different changes have resulted in lower prices than the largest increases.” Napa County suffered in sales as a result of generally high wine prices and, at the same time, Sonoma came out on top.

“With a 37.6 percent increase in the number of DtC shipments, Sonoma expanded its reach across Naples as the largest source of DtC winery vessels,” according to the report. Lesser-known regions in California, such as Mendocino, Lake, Livermore, Temecula and Sierra Nevada, recorded a “43.1 percent increase in the volume of loads and a 31.7 percent increase in the value of these loads – all with an eight percent decrease in the average price per bottle taken since 2019, ”according to the report.

Winery size and forecast

Interestingly enough, both the largest and smallest winches benefited the most from the odd sales conditions in 2020. There are usually major winters that make 500,000 or more issues each year, according to the report, “the lowest average price per bottle removed, a gain in 2020 as DtC buyers increasingly sought wine at a higher price low. “At the same time, medium-sized producers, making between 50,000 and 499,999 cases per year,“ performed lower in the total DtC shipping channel with an increase of 20.9 per cent. However, reducing prices by just 3.3 per cent saw a 16.8 per cent increase in the value of freight. ”

The report concludes with a number of forecasts for the coming year. They include a continuously higher-than-normal volume through at least June 2021, continued downward pressure on prices and a sharp rise in competition for consumers ’online business. It’s shaping up to be a game-changing year.