Milestones in the American Wine Business
If you are talking to friends and family about malolactic fermentation, barrels or yeast, while you are enjoying a glass of wine, you are showing off and sharing your knowledge of wine. This is a wonderful thing as wine will only grow by word of mouth and through social gatherings. Today, I would like to share my take on a different kind of knowledge by talking about some specific events that I believe shaped the American wine business to make it what it is today.
We could start with our third President and one of our Founding Fathers, Thomas Jefferson and his love of wine. But I am thinking of more recent history, like around my birth year in 1976. You may know about the most famous blind wine tasting of all time: “The Judgement of Paris.” Each wine was scored out of 20 points and no specific grading framework was given to the judges. They had, as one may say over there, carte blanche. American wines were tasted against “the Best of the Best,” their French counterparts from Bordeaux and Burgundy.
Two California wineries, Chateau Montelena and Stags Leap Wine Cellars, finished at the top of their respective categories. A bottle of each of their wines are in the Smithsonian’s National Museum of American History in remembrance of this historical result.
The 1976 Judgment of Paris had a revolutionary impact by showing the path of a new world of viticulture and winemaking outside of the traditional (Old World) Europe.
A few weeks ago, long time CBS correspondent, Morley Safer passed away. He will always be remembered as the journalist who singlehandedly increased the level of wine consumption in the United States. His November 17, 1991, CBS “60 Minutes” broadcast featured a report on the correlation between French consumption of red wine and their lower rates of heart disease. The TV segment popularized and legitimized the “French paradox.” This phrase is attributed to Professor Renaud from the Bordeaux University. In a nutshell it means, eating cheese and drinking wine can be beneficial to your health!
After its airing, Americans immediately went running to wine stores. The four weeks following the broadcast resulted in a 44% increase in sales of red wine in U.S. supermarkets. During that time, some retailers even promoted their wines as health food. This theory has been tested time and again, but does not seem to have lost any traction. The take away here is that wine, in moderation, is good for you.
Our model at WineShop At Home is pretty unique. We deliver the wine lifestyle right to your doorstep with handcrafted artisan wines. There has recently been a rebirth in appreciation for, and movement toward local, sustainable and artisanal crafting in the United States. This movement has inspired 434 new craft distilleries, 2,075 new craft breweries and 7,345 new wineries throughout the nation. Craft breweries and wineries are not a new concept, but there has certainly been a resurgence in the “local approach” and it is indeed the fastest growing segment in the beverage industry. This is now a driving force in the U.S., bringing excitement and whetting the taste buds of consumers. People want handcrafted, high-quality products that come from a proven and trusted source.
The following statistics are proof that the wine business is healthy and doing very well.
– Since 2002, wine sales have achieved an almost 2% growth rate every single year.
– The United States now produces close to 340 million cases.
– Nationally, the “top ten” states account for more than 60% of U.S. wine consumption. California is the front-runner with 56 million cases, followed by Florida and New York each consuming about 25 million cases. A third tier group emerges with New Jersey, Texas, Illinois and Massachusetts each averaging 14 million cases.
– The market share of beer is around 50% of the U.S. beverage alcohol market. Wine is nearing a market share of 20%, but in retail value, the wine business has already surpassed beer several times over in the past few years. The total value of annual wine sales has been reported at $38 billion dollars.
– U.S. annual per capita alcohol consumption is 8.6 liters per year and French consumption is down to 11.4 liters (close to 3 gallons) per year. However, the United States just became the leader in overall worldwide wine consumption.