Wine Building Larger Presence in C-Stores
Dear Client:
New data from Information Resources (IRI) reveals that wines are picking up momentum in convenience stores versus the more traditional grocery and drugstore channel.
DOMESTICS TAKE THE LEAD. Domestic wines in particular showed impressive growth, up 6.5% in dollar sales and 6.4% in volume, in the four weeks to June 14. In fact, domestic wines gained almost a share point in dollar sales and gained 1.4 market share points in volume. Varietals in the 1.5 liter bottles were the most popular package size for domestic wine in c-stores.
Meanwhile, imports grew 1.7% in dollar sales in the four week period but lost almost a full share point. In terms of volume, imports declined -2.3% and lost 1.4 market share points. Unlike domestic wines, imports saw the most growth among non-varietal bottles sized .75 liters.
WHITE WINE MOST POPULAR. Note that much more domestic wines are sold in c-stores than imports. In the period, domestics incurred about $23.4 million in dollar sales and about 310,000 cases. Imports sold about $7.6 million worth of wine and 78,000 cases.
Overall, white wine grew at the fastest rate, particularly fume/sauvignon blanc and pinot grigio/gris, with chardonnay trailing behind. Pinot noir took the lead among reds followed by cabernet sauvignon and trusty merlot. Surprisingly, white zinfandel lost share in both dollar sales (0.7) and even more so in volume (1.2).
California by far has the largest presence in c-stores, particularly in terms of cases sold. California wines grew 7% in dollar sales and gained 1.1 market share points in the period, and grew 6.8% in volume gaining 1.6 market share points. Oregon wines, which have a much smaller presence, showed impressive growth in sales (38.3%) and volume (50%) and gained about half a share point in both categories.
Although far behind California, Australian wines have the second largest presence in c-stores (not surprisingly). Australian wines lost some market share in both dollar sales and volume, but grew 0.4% and 2.1%, respectively. Imported wines growing at the fastest rates included France, New Zealand, Argentina and Spain.
WINES $8 AND BELOW WIN. In c-stores cheaper was better in June – a motto that seems to apply to all channels in this environment. With imports and domestic combined, wines priced $8 and below showed the most growth. The $11-$15 category posted some growth in dollar sales but declined in volume, while all other table wine price categories were in declines. The $2 and above boxed wine segment came in particularly strong, gaining 0.7 market share points in dollar value and 1 share point in volume.
The two wine brands that far outshone all the others in terms of market share growth in both dollar sales and volume were Barefoot and Sutter Home. The five wines with the biggest presence in c-stores are Sutter Home, Yellow Tail, Barefoot, Gallo Family Vineyard and Woodbridge.
DIAGEO REFUTES CLAIMS IT IS RECEIVING TARP FUNDS FROM THE BAILOUT
Remember the Bloomberg story on Diageo’s new Captain Morgan distillery in St. Croix? Well, Diageo has issued a press release refuting certain details of the article, namely that “Diageo has never sought, and will not receive TARP funds,” which are funds from the Troubled Assets Recovery Program from the U.S. government.
Diageo took especial offense with this line in the Bloomberg story: "Bailout of U.S. Banks Gives British Rum a $2.7 Billion Benefit... The $2.7 billion Diageo tax break in the October bailout bill gives the most financial aid to a non-U.S. company."
This suggestion “is false,” says the company. “The public-private initiative that is bringing Captain Morgan to St. Croix is based on cover over, not TARP.” Congress has reenacted the rum cover over extender (which increases cover over from $10.50/gallon to $13.50/gallon) for over 50 years “as part of an independent package of tax extenders” because Congress believes the US Virgin Islands “has a continuing need for cover over revenues to promote its economic stability and fiscal autonomy.”
Diageo said it is “purely a matter of circumstance” that Congress attached the extenders package to the TARP bill last fall, and that the cover over is completely unrelated in any way to either the bailout or TARP money.
Says Diageo: “The suggestion in the Bloomberg article that Diageo somehow benefits from TARP funds is misleading and gives the reader an inaccurate and false impression. Diageo's agreement with the USVI was announced in June 2008 -- well before any TARP legislation was ever discussed on Capitol Hill. Even if this extender had never been introduced or passed, Diageo's agreement with the USVI would still be in tact.”
And there you have it.
WSD BRIEFS:
WE’VE RECEIVED WORD THAT Southern Wine and Spirits is working on a deal to distribute all of Constellation’s brands in California, including those currently distributed by Young’s Market. We have no further details about the rumored change. Expect a lot of news concerning Constellation and its consolidation of wholesalers in the coming months.
CORRECTION. We attributed Geyser Peak Winery to Constellation in yesterday’s report, but the company of course sold the brand to Ascentia Wine Estates last year. Sorry for the mistake.
Until tomorrow, Megan
“You don’t have to specialize - do everything that you love and then, at some time, the future will come together for you in some form.”
Francis Ford Coppola
--------- Sell Day Calendar ----------
Today's Sell Day: 2
Sell days this month: 23
Sell days this month last year: 23
This month ends on a: Fri
This month last year ended on a: Thurs
YTD sell days Over/Under: 0
WINE & SPIRITS DAILY
Subscribe or check back issues at: www.winespiritsdaily.com
Send news and comments in confidence to: megan@winespiritsdaily.com
© 2008 Wine & Spirits Daily, all rights reserved. May quote with attribution.
Follow me on Twitter http://twitter.com/WineSpiritDaily
New data from Information Resources (IRI) reveals that wines are picking up momentum in convenience stores versus the more traditional grocery and drugstore channel.
DOMESTICS TAKE THE LEAD. Domestic wines in particular showed impressive growth, up 6.5% in dollar sales and 6.4% in volume, in the four weeks to June 14. In fact, domestic wines gained almost a share point in dollar sales and gained 1.4 market share points in volume. Varietals in the 1.5 liter bottles were the most popular package size for domestic wine in c-stores.
Meanwhile, imports grew 1.7% in dollar sales in the four week period but lost almost a full share point. In terms of volume, imports declined -2.3% and lost 1.4 market share points. Unlike domestic wines, imports saw the most growth among non-varietal bottles sized .75 liters.
WHITE WINE MOST POPULAR. Note that much more domestic wines are sold in c-stores than imports. In the period, domestics incurred about $23.4 million in dollar sales and about 310,000 cases. Imports sold about $7.6 million worth of wine and 78,000 cases.
Overall, white wine grew at the fastest rate, particularly fume/sauvignon blanc and pinot grigio/gris, with chardonnay trailing behind. Pinot noir took the lead among reds followed by cabernet sauvignon and trusty merlot. Surprisingly, white zinfandel lost share in both dollar sales (0.7) and even more so in volume (1.2).
California by far has the largest presence in c-stores, particularly in terms of cases sold. California wines grew 7% in dollar sales and gained 1.1 market share points in the period, and grew 6.8% in volume gaining 1.6 market share points. Oregon wines, which have a much smaller presence, showed impressive growth in sales (38.3%) and volume (50%) and gained about half a share point in both categories.
Although far behind California, Australian wines have the second largest presence in c-stores (not surprisingly). Australian wines lost some market share in both dollar sales and volume, but grew 0.4% and 2.1%, respectively. Imported wines growing at the fastest rates included France, New Zealand, Argentina and Spain.
WINES $8 AND BELOW WIN. In c-stores cheaper was better in June – a motto that seems to apply to all channels in this environment. With imports and domestic combined, wines priced $8 and below showed the most growth. The $11-$15 category posted some growth in dollar sales but declined in volume, while all other table wine price categories were in declines. The $2 and above boxed wine segment came in particularly strong, gaining 0.7 market share points in dollar value and 1 share point in volume.
The two wine brands that far outshone all the others in terms of market share growth in both dollar sales and volume were Barefoot and Sutter Home. The five wines with the biggest presence in c-stores are Sutter Home, Yellow Tail, Barefoot, Gallo Family Vineyard and Woodbridge.
DIAGEO REFUTES CLAIMS IT IS RECEIVING TARP FUNDS FROM THE BAILOUT
Remember the Bloomberg story on Diageo’s new Captain Morgan distillery in St. Croix? Well, Diageo has issued a press release refuting certain details of the article, namely that “Diageo has never sought, and will not receive TARP funds,” which are funds from the Troubled Assets Recovery Program from the U.S. government.
Diageo took especial offense with this line in the Bloomberg story: "Bailout of U.S. Banks Gives British Rum a $2.7 Billion Benefit... The $2.7 billion Diageo tax break in the October bailout bill gives the most financial aid to a non-U.S. company."
This suggestion “is false,” says the company. “The public-private initiative that is bringing Captain Morgan to St. Croix is based on cover over, not TARP.” Congress has reenacted the rum cover over extender (which increases cover over from $10.50/gallon to $13.50/gallon) for over 50 years “as part of an independent package of tax extenders” because Congress believes the US Virgin Islands “has a continuing need for cover over revenues to promote its economic stability and fiscal autonomy.”
Diageo said it is “purely a matter of circumstance” that Congress attached the extenders package to the TARP bill last fall, and that the cover over is completely unrelated in any way to either the bailout or TARP money.
Says Diageo: “The suggestion in the Bloomberg article that Diageo somehow benefits from TARP funds is misleading and gives the reader an inaccurate and false impression. Diageo's agreement with the USVI was announced in June 2008 -- well before any TARP legislation was ever discussed on Capitol Hill. Even if this extender had never been introduced or passed, Diageo's agreement with the USVI would still be in tact.”
And there you have it.
WSD BRIEFS:
WE’VE RECEIVED WORD THAT Southern Wine and Spirits is working on a deal to distribute all of Constellation’s brands in California, including those currently distributed by Young’s Market. We have no further details about the rumored change. Expect a lot of news concerning Constellation and its consolidation of wholesalers in the coming months.
CORRECTION. We attributed Geyser Peak Winery to Constellation in yesterday’s report, but the company of course sold the brand to Ascentia Wine Estates last year. Sorry for the mistake.
Until tomorrow, Megan
“You don’t have to specialize - do everything that you love and then, at some time, the future will come together for you in some form.”
Francis Ford Coppola
--------- Sell Day Calendar ----------
Today's Sell Day: 2
Sell days this month: 23
Sell days this month last year: 23
This month ends on a: Fri
This month last year ended on a: Thurs
YTD sell days Over/Under: 0
WINE & SPIRITS DAILY
Subscribe or check back issues at: www.winespiritsdaily.com
Send news and comments in confidence to: megan@winespiritsdaily.com
© 2008 Wine & Spirits Daily, all rights reserved. May quote with attribution.
Follow me on Twitter http://twitter.com/WineSpiritDaily
