October 3, 2013 § Leave a comment
Here are some highlights from Winemetrics’ recently published 2013 On-Premise Wine Distribution Report :
1. Wine lists are getting smaller. We reviewed 50 casual chain from 2013 and our previous survey and discovered that the average BTB (by-the-bottle) listings fell from an average of 30 listings to 28.
2. Hot varieties are stealing share from more established varieties. Moscato, Red Blends, Malbec and Prosecco all posted robust growth in 2013 but Cabernet Sauvignon, Sauvignon Blanc and Syrah/Shiraz lost share.
3. Argentina and Italy increased share; France, Australia, Chile and South Africa had double-digit share losses.
4. Italian Pinot Grigio/Gris grew at the expense of its U.S. producers of this popular variety.
5. While U.S. wines increased share by 2%, Washington State accounts for much of this growth. Oregon wines lost share
For more information regarding wines on-premise visit http://www.winemetrics.com
October 2, 2013 § Leave a comment
Actually, this is a two part question. First we’ll explore its current value to Treasury Wine Estates (TWE) which is purported to be entertaining its sale. Second, we’ll examine Beringer’s potential value to a buyer.
Note: this analysis is solely based on TWE/Beringer’s on-premise distribution. Winemetrics firmly believes the overall long-term viability of a wine brand (or spirits or beer brand) is a function of its strength on-premise which provides 3rd-party endorsements, consumer trial occasions and brand building opportunities.
1. Beringer’s Value to TWE – Should TWE sell Beringer it would lose its flagship brand and nearly 50% of its on-premise distribution. Penfold’s, TWE’s #2 brand on-premise, has less than 1/4 of Beringer’s distribution and Australian wines are continuing to decline on-premise. TWE does not have a strong #2 or # 3 brand to pick up Beringer’s lost distribution. Beringer and Penfold’s account for 60% of TWE’s distribution on-premise. The remaining 40% is divided among 18 brands, the largest of which, Chateau St. Jean, has only a 6% share of TWE’s BTB (By the Bottle) distribution. The loss of Beringer would drop TWE from 4th to 9th in Winemetrics Supplier Rankings and most likely curtail TWE’s distribution opportunities on-premise.
2. Beringer’s Value to a Potential Buyer – Any potential buyer of Beringer would have to be interested in the popularly priced portion of its portfolio as 2/3 of Beringer’s on-premise BTB distribution is White Zinfandel, (the BTG portion is even higher). Beringer owns the White Zinfandel segment, accounting for nearly 60% of its distribution and outselling #2 Sutter Home by over a 2:1 margin. Beringer White Zinfandel will provide any potential buyer with a significant presence in casual chains and one of the most recognized brands in the wine industry, but such a buyer must either have confidence on the long-term viability of White Zinfandel or be prepared to rebuild Beringer’s ultra-premium presence on-premise.
All of the data quoted in the above blog is from Winemetrics’ 2013 On-Premise Wine Distribution Reports and may not be used or published without permission.