Restaurant Chains Fail To Optimize Wine List Profitability
October 12, 2010 § Leave a comment
Winemetrics’ 2010 Chain Restaurant Wine Distribution Report continues to provide unique insights into the structure and features of America’s wine lists. For example, our survey indicates that nearly 2/3 (62%) of chains provide a wine list on their websites but only 49% provide wine lists with prices. Regarding wine list formats, 36% use a progressive format (light to full-bodied) and the remaining 64% use a traditional format (mostly organized by variety)
Here are some other important statistics from our report.
15% offer wine by-the-glass in multiple sizes
13% offer flights
12% offer half-bottles
10% offer a build your own flight option
About half provide by-the-glass choices on the food menu and 48% combine their entire wine and food menus.
Given the state of the economy and long-term challenges facing the restaurant industry, one would expect chains to embrace more wine list options to increase wine profits.
I’m certain that most of readers of this newsletter have heard about the groundbreaking research done by Cornell’s Center for Hospitality Research as outlined in a 2007 Issue of Wines & Vines and a study found on Cornell’s CHR website. One study, by Brian Wansink, Ph.D., was performed in a casual seafood chain restaurant in Texas with a list of less than 20 wines, a chain that is included in Winemetrics 2010 Chain Restaurant Wine Distribution Report. Dr. Wansink results are especially astounding for tastings (2 oz. portions) where “not only did the study find that two-ounce tasting portions increase sales by 18-47%, but the more the merrier. The single tasting promotion increased subsequent sales of full glasses by 18.2%, but when five tastes were offered, the total increase in sales for all five wines grew an astonishing 47.3% week on week”. Given this evidence it is shocking that only 13% of chain restaurants in our survey offer tastings or flights.
Specific details on 104 casual and upscale casual restaurant chain wine lists and how to increase their profitability (using the above research and some of our own) can be found in our 2010 Chain Restaurant Wine Distribution Report. More information and ordering details can be found here.