First Celebrity Perfume, Now Wine
Many reports have surfaced in the past two years on the growth of critter brands (wines with cute little animals on their labels) and why consumers buy them. However, a new report by Nielsen suggests so-called celebrity wines and spirits could replace critter brands as the new hotness among Americans. Celebrities associated with popular wines include Francis Ford Coppola, former NFL coach Mike Ditka, professional golfer Greg Norman, Martha Stewart, Paul Newman and don’t forget Paris Hilton. Is there anything these people can’t make money on?
Celebrity wines are up nearly 19% in grocery store sales since last year and represent 0.9% ($41.8 million) of total wine sales, says Nielsen. Celebrity spirits sales show the same growth rate (19%) in grocery stores and represent 0.3% ($7.5 million) of the total spirits category. In liquor stores, celebrity spirits are growing at an even faster rate, showing a nearly 21 % since last year, compared to celebrity wines’ liquor store growth rate of 8%.
Some celebrities lend their names to wine and spirits because they personally like the category or they think it represents their lifestyle. (For example, a rapper perceived as having a luxurious lifestyle decides to market an upscale Champagne.) Richard Hurst, senior vp, Beverage Alcohol, The Nielsen Company, says that putting a celebrity’s name or face on a brand helps small companies promote their product without launching a big advertising and promotional campaign.
WHY THE GROWTH? Hurst says celebrity wines are growing for three main reasons. One, existing brands are entering celebrity line extensions. Two, celebrities are becoming increasingly interested in launching their own brands and/or have suppliers launch products under their names. Three, marketers are able to leverage the ‘celebrity’ benefit with more marketing initiatives, including retail and outdoor events, traditional platforms (magazines) and online media (Perezhilton.com).
Nielsen found that celebrity brands are not necessarily receiving more retail support. Much like the regular table wine category, about 50% of celebrity wine volume is sold on promotion. When it comes to pricing, however, consumers are paying an average of $8.50 per 750ml bottle of celebrity wine, versus $5.75 per bottle of table wine. Most celebrity wines are priced between $12 and $15.
It turns out the west coast is most receptive to celebrity brands. (I suppose they’re more used to the concept.) Nielsen’s analysis of grocery store sales in 52 U.S. markets shows that consumers in Phoenix purchase 68% more celebrity wine compared to table wine, relative to their national share, with Los Angeles and San Francisco, Dallas and San Diego also showing above average sales.
AUSSIE WINE EXPORTS TO RISE OVER THE NEXT 3 YEARS
Good news for Australian grape growers and exporters: the days of cheap bulk wine could be coming to an end, at least for now. Australian wine grape prices are expected to increase over the next three years thanks to low yields and the increasing value of wine exports, reports ABC News. Prices are expected to increase by to $155 per ton.
"It's good news for the wine grape growers that provide the input to the production of wine, and keeping them more viable than has been possible over the last couple of years of drought," said ABARE's senior economist, Brenda Dyack. "We have said that there's going to be a slow recovery of the next two years back up to the potential that we know is there."
WSD BRIEFS:
VIRGINIA GOV. TIMOTHY KAINE signed HB 908 allowing ABC stores to be open on Sunday in any city with a population of 100,000 or more. Since 2004, ABC stores may be open on Sunday, at the discretion of the ABC Board, in the Counties of Fairfax, Arlington, Loudoun, and Prince William, and in the Cities of Alexandria, Fairfax City, Manassas, Manassas Park, Norfolk, and Virginia Beach. The bill adds the Cities of Portsmouth, Hampton, Newport News, Richmond, and Chesapeake.
HARDY WINE COMPANY will change its name to Constellation Wines Australia at the end of March. President John Grant said it will allow Hardy to “return to being a winery, known for quality and craftsmanship, rather than being known as a corporation.”
WAL-MART net sales for Wal-Mart stores rose 5.6% in February, while Sam’s Club rose 6.5% in the U.S. In the four weeks to March 2, comparable store sales without fuel grew 0.4% for Wal-Mart stores and 3.9% for Sam’s. Overall, same-store sales in the U.S. increased 0.9% without fuel and 0.8% with fuel. Wal-Mart said much of its strength came from groceries and consumables.
TARGET same-store sales grew 0.5% in February. Net retail sales for the four weeks ended March 1, 2008 increased 5.9%to $4,373 million from $4,128 million for the four weeks ended March 3, 2007.
Until tomorrow, Megan
“Reading is to the mind what exercise is to the body.”
-Sir Richard Steele
--------- Sell Day Calendar ----------
Today's Sell Day: 4
Sell days this month: 21
Sell days this month last year: 22
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: +1
Celebrity wines are up nearly 19% in grocery store sales since last year and represent 0.9% ($41.8 million) of total wine sales, says Nielsen. Celebrity spirits sales show the same growth rate (19%) in grocery stores and represent 0.3% ($7.5 million) of the total spirits category. In liquor stores, celebrity spirits are growing at an even faster rate, showing a nearly 21 % since last year, compared to celebrity wines’ liquor store growth rate of 8%.
Some celebrities lend their names to wine and spirits because they personally like the category or they think it represents their lifestyle. (For example, a rapper perceived as having a luxurious lifestyle decides to market an upscale Champagne.) Richard Hurst, senior vp, Beverage Alcohol, The Nielsen Company, says that putting a celebrity’s name or face on a brand helps small companies promote their product without launching a big advertising and promotional campaign.
WHY THE GROWTH? Hurst says celebrity wines are growing for three main reasons. One, existing brands are entering celebrity line extensions. Two, celebrities are becoming increasingly interested in launching their own brands and/or have suppliers launch products under their names. Three, marketers are able to leverage the ‘celebrity’ benefit with more marketing initiatives, including retail and outdoor events, traditional platforms (magazines) and online media (Perezhilton.com).
Nielsen found that celebrity brands are not necessarily receiving more retail support. Much like the regular table wine category, about 50% of celebrity wine volume is sold on promotion. When it comes to pricing, however, consumers are paying an average of $8.50 per 750ml bottle of celebrity wine, versus $5.75 per bottle of table wine. Most celebrity wines are priced between $12 and $15.
It turns out the west coast is most receptive to celebrity brands. (I suppose they’re more used to the concept.) Nielsen’s analysis of grocery store sales in 52 U.S. markets shows that consumers in Phoenix purchase 68% more celebrity wine compared to table wine, relative to their national share, with Los Angeles and San Francisco, Dallas and San Diego also showing above average sales.
AUSSIE WINE EXPORTS TO RISE OVER THE NEXT 3 YEARS
Good news for Australian grape growers and exporters: the days of cheap bulk wine could be coming to an end, at least for now. Australian wine grape prices are expected to increase over the next three years thanks to low yields and the increasing value of wine exports, reports ABC News. Prices are expected to increase by to $155 per ton.
"It's good news for the wine grape growers that provide the input to the production of wine, and keeping them more viable than has been possible over the last couple of years of drought," said ABARE's senior economist, Brenda Dyack. "We have said that there's going to be a slow recovery of the next two years back up to the potential that we know is there."
WSD BRIEFS:
VIRGINIA GOV. TIMOTHY KAINE signed HB 908 allowing ABC stores to be open on Sunday in any city with a population of 100,000 or more. Since 2004, ABC stores may be open on Sunday, at the discretion of the ABC Board, in the Counties of Fairfax, Arlington, Loudoun, and Prince William, and in the Cities of Alexandria, Fairfax City, Manassas, Manassas Park, Norfolk, and Virginia Beach. The bill adds the Cities of Portsmouth, Hampton, Newport News, Richmond, and Chesapeake.
HARDY WINE COMPANY will change its name to Constellation Wines Australia at the end of March. President John Grant said it will allow Hardy to “return to being a winery, known for quality and craftsmanship, rather than being known as a corporation.”
WAL-MART net sales for Wal-Mart stores rose 5.6% in February, while Sam’s Club rose 6.5% in the U.S. In the four weeks to March 2, comparable store sales without fuel grew 0.4% for Wal-Mart stores and 3.9% for Sam’s. Overall, same-store sales in the U.S. increased 0.9% without fuel and 0.8% with fuel. Wal-Mart said much of its strength came from groceries and consumables.
TARGET same-store sales grew 0.5% in February. Net retail sales for the four weeks ended March 1, 2008 increased 5.9%to $4,373 million from $4,128 million for the four weeks ended March 3, 2007.
Until tomorrow, Megan
“Reading is to the mind what exercise is to the body.”
-Sir Richard Steele
--------- Sell Day Calendar ----------
Today's Sell Day: 4
Sell days this month: 21
Sell days this month last year: 22
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: +1
posted at 12:21 PM
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