In the face of growing competition from other drinks, the wine category in Canada is managing to hang on to its more engaged and higher spending consumers
At first it seems like bad news. The latest Wine Intelligence Canada Wine Landscapes report estimates that number of regular (monthly or more) wine drinkers in Canada has decreased by three million people since 2017, to 16.8 million. Why is this happening? One fairly obvious reason is that fewer Canadians are touching wine at all – the yearly wine drinking population has also lost approximately three million people since 2017.
Looking closer at the data, however, and a more positive picture emerges. While weekly consumers of wine are also down, their numbers have held up better: around 13 million Canadian adults drink wine at least once a week, or 78% of the monthly drinking population, up from 72% in 2017. At the same time, overall wine volumes are growing slightly (which aligns with increasing recalled consumption frequency), spend per bottle is up, and consumers themselves appear to be more engaged and knowledgeable about wine.
This all helps make Canada the second most attractive wine market in the world after the US according to Wine Intelligence’s Wine Market Attractiveness Model reported in Global Compass 2019. Part of the reason for this strong showing is that wine consumption levels around the world are static or falling, as moderation trends and the rise of health consciousness among consumers around the world take hold, and the options in other alcohol categories grow more numerous and attractive.
As with other developed markets, today’s typical regular wine drinker in Canada has a lot more choice from other alcohol categories, and is typically more mindful of their alcohol intake. The proportion of Canadian regular wine drinkers who consider the alcohol content of a wine to be either ‘important’ or ‘very important’ when choosing a wine has increased by eight percentage points since 2014 to 44% in English-speaking provinces, and by a more spectacular 20 percentage points to 54% among wine drinkers in Quebec. This shift has also been noticed by trade experts, who report seeing an increasing demand for lower and no-alcohol wine.
Canadians have also shown a growing interest and demand for other alcoholic categories, including beer, whisky and gin. Canada has always been strong for beer, and the recent explosion of offerings in local, craft and speciality beers has started to eat into the wine occasion. Local craft beer is now consumed by 40% of wine drinkers, an increase of 11 percentage points in incidence since 2014.
The increasing demand for local products is also reflected within the wine category. Canadian wine ranks first in terms of consumption among all Canadian regular wine drinkers, with almost two thirds of the overall wine drinking population drinking domestic wine in the past six months. Although English-speaking Canadians are the group driving this behaviour, a third of Québécois regular wine drinkers have also consumed Canadian wine in the past six months, whilst showing a strong residual preference for European wines.
Over the next twelve months, the vibrant and expanding domestic wine production in Canada is sure to have a positive impact on the Canadian wine market as a whole. It possibly already has, as Canadian regular wine drinkers are showing significantly higher levels of wine knowledge when compared with 2014, bucking the global trend of reducing wine knowledge. Therefore, despite the influence of moderation and category-switching on the regular wine drinking population, Canada is growing into a more stabilized wine market with an interesting scope for greater domestic expansion.