How To Build A Premium Brand Beyond Price
According to the Silicon Valley Bank’s annual state of the wine industry report, the premium wine segment in the US is expected to experience a sales growth of 9-13% in 2016. The industry defines premium or fine wines based on price range falling between $13 to 19 and graduates to ultra-premium from $20+.
The trend towards premium and away from volume is driven by three main factors:
First, while the Boomer generation still has the largest consumer footprint on the wine industry, research shows their consumption is slowly decreasing. Meanwhile, Millennial wine drinkers are becoming increasingly educated and sophisticated about wine. Thus, as Millennials continue to age and earn more income they will graduate to wines of hire price points. Related to that, the economic recovery in the last few years means wine drinkers have more disposable income and may be more likely to splurge on a premium wine. Finally, on the supply side interest in producing volume wine has been decreasing. In part due to environmental and climactic changes, winemakers are shifting to a quality over quantity approach.