April 7, 2014 § 1 Comment
According to Winemetrics preliminary 2014 wine list survey, 8 leading casual dining chains have reduced their wine selections, most by double digits. The following data indicates the steepest across the board decline we have ever witnessed in on-premise wine selections. This may portend a trend by national accounts to shift emphasis from wine to the faster growing craft beer and cocktail segments of their beverage programs.
Winemetrics compared its mid-year 2013 wine list data with recently acquired data from identical chains this year. Our findings indicate the following combined by-the-bottle and by-the-glass wine listings decreases by percentage.
Longhorn Steakhouse -22%
Olive Garden -28%
Outback Steakhouse -18%
Red Lobster -6%
Ruby Tuesday -17%
We will post more insights on this trend as our 2014 wine list update continues.
April 7, 2014 § Leave a comment
There is a saying in the wine business: “On-Premise is where beverage trends begin and brands are built”. As someone who has monitored on-premise trends for the better part of the past 4 decades, I have witnessed trends on-premise shape the wine industry. I have also seen trends, categories and brands, come and go and I honestly believe that the alcohol beverage industry is at an inflection point, an instant when market forces and demographics can change the dynamics of an industry dramatically in a short period of time. In the alcohol beverage industry there have been several recent inflection points, for example, the rapid decline of Scotch and Blended whisk(e)y after 1980 (and parallel rise in vodka consumption). More recent examples of inflection points would be the transformation of still wine from declining consumption to robust growth in the early 1990’s and the spectacular recent expansion of craft beers which now accounts for 14% of the total US beer market.
If we follow the logic of trends originating on-premise, there are indications that wine consumption may be primed for dramatic changes. Based on Winemetrics intial 2014 survey of wine on-premise, wine’s popularity may again be in decline. This is not due to a rejection of wine as the beverage of choice but rather the rise of formidable competitors in the form of craft beer and cocktails. In the past, wine was the go-to beverage for dining out. This was not necessarily because the wine list offered a particularly good assortment of products at reasonable prices; it was often because there was no reasonable alternative. Wine came to prominence on-premise at a time when beer lists were a monotony of light lagers, imported and domestic, and the cocktail list, if there was one, contained either insipid sweet drinks or simple standards composed of uninspired ingredients. Essentially wine won by default and diners put up with red, white or rose choices, especially in casual dining venues. This scene changed in the early-mid-1980s with the arrival of a younger, hipper restaurateurs seeking to redefine the dining experience. The restaurant boom of the 1980s and 1990s provided a platform for wines of new varieties from new wine regions. Wines became exciting and Boomers abandoned the beer and spirits diet of their parents and embraced all manner of exotic wines from around the globe. Around this time period, wine production took off and California went from Napa Valley to AVAs encompassing the entire West Coast. Craft brewing consisted of Anchor Steam and Sierra Nevada and several smaller brands (such as New Amsterdam where I worked) and the cocktail culture, as it was, resided with Dale DeGroff at the Rainbow Room bar.
Now, in the second decade of the new millennium, wine is now the old man of the beverage world, and it shows in the innovation, promotion and marketing of their products. Brewers are blending technology and tradition to create new flavors, acting more like Michelin-starred chefs than brewmasters, producing a vast array of incredibly unique and complex products. They are even employing used wine barrels to age their more sophisticated brews.
Spirits producers have followed suit with artisanal spirits aged in two sometimes three different types of barrels. Natural flavors have been added, beginning with vodka and migrating to brown spirits. Mixologists are barrel-aging cocktails and designing their own bitters and mixers. At cocktail destinations in major US cities, the drink architect is very likely the person behind the bar. His/her wine counterpart, the sommelier, may be lucky to collaborate on a single label with a talented enologist, but he/she plays merely a (wine list) editor’s function to the mixologist’s role as author.
The beer and drink artisan are now prepared to assault the bastion that wine has occupied for decades, the role of food’s companion. They have technology, innovation and imagination on their side, plus a Millenial audience that eschews artifice and spin. Slapping a cute label on a bulk product won’t work on them, much to the chagrin of wine marketers who think that is a path to the next Yellow Tail or Little Black Dress.
As someone who has been in the wine business for over 30 years, I have a unique and surprisingly sober view of our industry. I have seen trends and brands come and go, NY State Wine, Portuguese Roses, Wine Coolers, German Liebfraumilch, Alsatian Whites, Chilean wines (remember when those used to be on every wine list). But those trends cycles aside, there was always one constant. Wine was always the go-to beverage when dining out. That is not the case anymore, and wine will have to either meet its beer and spirits competitors head on or be satisfied with a diminished role on-premise.