From today, we are making the Wine Intelligence US COVID-19 Impact Report Issue #1 open source.
This report was originally published in May, based on a survey of 2,000 Americans who drink wine at least once a month and was conducted in late March and early April. At the time, we billed this report as offering insights from the ‘height of the impact of the pandemic’ in the US wine market. Two months on, it seems like we (and many others) were premature to describe the peak of the crisis in the US as being in April. For the US market, at least, the pandemic and its impacts on alcoholic beverage consumption will be with us for some time to come.
The key takeaways from this US report mirrored those we saw in other established and mature wine markets. Wine consumers are still enjoying a glass of wine at the end of a long day and online channels are seeing an increase in wine sales, especially from younger, affluent and urban-dwelling wine drinkers. The data published since then showing sales volumes holding up – an off-premise sales boom more or less making up for the loss of on-premise sales – while value (and especially high value products) declined, largely reflected the insights we were seeing from consumers. Overall, we were optimistic that the wine category might escape the punishment meted out to other sectors by the pandemic, while noting that the change in the product mix would benefit larger, established mainstream brands at the expense of higher value, niche and specialty wines.
Since the initial publication, we have been continuing to measure and analyse the impacts of the pandemic on the US wine market. This includes new analysis, which segments US wine drinkers into four distinct behavioral cohorts: Halters, Reducers, Moderators and Hedonists, based on their intended future lifestyle behavior post pandemic.
In June, we also released our analysis, based on our data modelling, which indicates that total US wine volumes will be flat in 2020 – with the increases in off premise volumes counterbalanced by the on-premise decline lasting until the end of the year. This assumed there would be continued declines in coronavirus cases in the US and no significant second wave impact. An alternative case was also presented which assumed a ‘second virus wave’ with a lockdown in October and November 2020. This model predicted that there would be a decline of around 2-3% in total wine volumes in the US, with the on premise seeing a year-on-year volume decline of closer to 50%.
Since we published these market volume estimates, many states have seen an increase in Covid cases, with some states currently imposing further lockdowns or stay at home orders, indicating that a ‘second wave’ may in fact be happening – or perhaps the first wave never really stopped. The decision to release our report as open source was made to provide as much help as possible to our wider client base in navigating and planning their US market strategy at a time when such planning and strategizing is turning from a once a year exercise to a weekly – or even daily – task.
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