Wine sales trends în Retail and HoReCa!

The global wine market is experiencing a period of transformation, driven by shifting consumer demographics, evolving purchasing habits, and an increasing focus on convenience and values. Understanding the distinct dynamics of the on-premise (restaurants, bars) and off-premise (retail, chains) channels is critical for wineries and distributors looking to thrive in the years ahead.

The Off-Premise channel: Retail stores and chains.

The off-premise market, encompassing traditional retail stores, large supermarket chains, convenience stores (c-stores), and increasingly, e-commerce, remains the volume driver for wine sales. However, this channel is facing challenges and opportunities that demand a nuanced strategy.

Large retail chains and discounters dominate off-premise volume, meeting consumer demands for convenience and competitive pricing. However, wine volumes in the lower price segment (under 10-15 euro) have seen declines. This suggests that while price remains a factor, consumers are either moderating overall consumption or opting to trade up to slightly higher-priced, premium options when they do purchase.

Accelerated by pandemic-era lockdowns, online wine sales have become a critical component of the off-premise market. E-commerce offers consumers convenience and the ability to compare prices and access a wider variety of products, including local, premium and imported wines.  Forecasts project continued strong growth for this channel, making a robust Direct-to-Consumer (DTC) and digital strategy essential. 

Wine sales in convenience stores are showing an upward trend, often outpacing other channels. This growth is driven by consumer demand for quick, frequent shopping trips and is supported by alternative packaging formats like canned wine and small-format bottles, which appeal to younger consumers and suit on-the-go consumption.

Younger consumers (Millennials and Gen Z) are using their purchasing power to support brands that align with their values.  In off-premise retail, wines emphasizing sustainability, organic, biodynamic, or minimal-intervention credentials are gaining appeal. Clear, prominent labeling about a wine's environmental and ethical practices is becoming a powerful sales driver.

The On-Premise channel: HoReCa

The on-premise channel is vital for brand building, consumer discovery, and driving premiumization, as it often dictates trends and offers an experiential element lacking in retail.

Despite recent dips in visit frequency due to economic pressures, the on-premise sector remains the primary place where brands gain traction and where consumers are most willing to trade up to higher-quality, more expensive wines. Consumers are shifting toward a "fewer but better" mindset, concentrating their spend on premium choices during special occasions and social outings.

The modern consumer, particularly younger drinkers, seeks experiential dining and unique offerings. Restaurants and bars can capitalize on this by offering:

• by-the-glass variety: half-bottles and diverse by-the-glass programs cater to the trend of moderation and offer opportunities for diners to sample premium wines.
• storytelling and education: menus that tell the story of the winemaker, region, or sustainable practices resonate deeply. Bartender and sommelier advocacy is crucial for guiding patrons to new or premium selections.

The broader cultural shift towards moderation and wellness is affecting on-premise wine lists. The demand for No- and Low-Alcohol (NoLo) wine options, along with wine-based Ready-to-Drink (RTD) cocktails, is growing, requiring restaurants to adapt their offerings to stay relevant.

Customer spending in the on-premise channel is becoming increasingly concentrated around personal holidays (birthdays, family events) or days associated with various special holidays or events that record a high volume of transactions. This requires a focus on high-impact activations and marketing campaigns for these key moments.

Strategic imperatives for the Wine Market

To succeed in this evolving landscape, wineries and sales organizations should adopt an omnichannel approach that strategically addresses the unique consumer behavior in each channel:

Harness digital and DTC: Invest in an outstanding e-commerce platform and digital marketing. Use online channels for education (virtual tastings, AR experiences) and to foster loyalty programs to build direct relationships with consumers, especially younger, digitally-native buyers.

Elevate premium and value messaging: In both on- and off-premise, focus on mid-to-premium-priced wines. In retail, emphasize quality cues, packaging, and clear value proposition. In restaurants, highlight the story and provenance to justify the price trade-up.

Innovate packaging and format: Embrace convenience with small-format bottles, cans, and sustainable packaging. These formats are crucial for growing segments like c-stores and for meeting consumer demand for moderation and portability.

Target the next generation: Acknowledge the decline in traditional wine consumption among younger cohorts who prefer spirits, RTDs, and NoLo options. Winemakers must actively connect wine to new occasions, emphasize sustainability, and use engaging, visual, and social-first content to make wine less intimidating and more aligned with the values of Millennials and Gen Z.

The wine market is consolidating and shifting, but for brands that prioritize customer experience, digital engagement, and alignment with modern consumer values, significant growth opportunities remain across all sales channels.

These trends underscore the need for a well-defined, data-driven market strategy.

If you wish to explore in detail how these changes specifically affect your brand or business and receive customized data analysis to optimize your distribution and sales across the On-Premise, Off-Premise, and DTC channels:

We invite you to contact us for a business consultation. We will translate market data into actionable strategies tailored to your objectives.

Contact us today at office@artvinium.ro to schedule a meeting.

This article contains excerpts from the presentation held by Wine Expert Ioana Bidian, ArtVinium Managing Director, for TRANSILVANIA EXECUTIVE EDUCATION, within the Executive MBA module.