The 4 Key Trends in the Wine Industry in the Past 20 Years

Decades-TrendsThis month I will embark on my 24th year working in the wine industry and I’ve begun to start to think, finally, about the industry from the top down. I was speaking with a friend about this perspective and they asked a pretty simple question:

“What have been the major themes in the wine industry over the past two decades?”

That it’s simple also makes it somewhat difficult to answer. But, by breaking down the industry into its constituent parts, it becomes a little easier to answer. The major themes that have dominated the four parts of the industry over the past 20+ years seem clear to me:

 

Part I: GRAPE GROWING
Terroir, Terroir, Terroir (or, what grows best where?)
Even before 1990, when I entered the business, the trend of trying to carefully pick where to plant which grapes was driving not only new vineyard plantings, but then the replantings that resulted from the Phylloxera outbreak of the 1908s and 1990s. It’s been a slow go to turn California, Oregon and Washington into the Old World, where certain grapes are grown in certain places because they tend to respond better. But the pace of this search for the right land for the right grape has only accelerated. This terroir-driven thrust of grape growing in America will of course continue as the drive to base sales on the spiritual and profitable notion of land-born quality and a wine’s connection to the land continues to be blessed by the consumer.

Part II: WINE PRODUCTION
Increasing production and broadening the source of production
The number of wineries that have launched since 1990 is nothing less than amazing. The increase has been exponential. In 1990 you could spend a week in Napa or Sonoma and feel like you had a great feel for the regions by having visited 15 or 20 wineries. You couldn’t touch the surface now. Nor in Paso Robles, Santa Barbara, Monterey County, Oregon or Washington. And today, every state in the nation has gotten in the game with no end in sight. Today, we can count New York, Virginia, Texas, Missouri, and Michigan and important wine-producing states with a number of others snapping at their heels. The increase and broadening in production of wine has been a direct result of the Baby Boomer generation adopting wine as their own and being willing to support not only America’s best known winegrowing regions but their own home state’s industries.

Part III: SALES
Modifying the Three Tier System
In 1990, with the exception of a few states, you had a very strict three-tier system of sales in place in which the producer depended entirely on the wholesaler to bring their products into the various states and the retailer depended upon the wholesaler to get them inventory to sell. Today wineries across the country, by having modified, stretched, altered and fought back against the 80-year-old relic of a sales system, can disregard the three-tier system almost entirely. These are smaller wineries, making less wine. But it is the emergence of alternative routes to the consumer that has allowed the explosion of wineries to occur over the past two decades.

Part IV: CONSUMERS
Empowering the consumer to feel confident in ordering and buying wineFor more than two decades everyone in the industry seems to have agreed that the consumer is intimidated by wine and needs to be made to feel comfortable choosing wine. I agree with this. I also understand that this has been the driving force behind the emergence of the 100 point rating system, behind the emergence of the sommelier as a force in the industry, behind the minds of the vast majority of wine media/writers and wine bloggers, and accounts for the reasoning behind most of the wine books, wine television and wine newsletters given to the wine drinking public in the past two decades. There is no reason to believe this imperative to calm the consumer will yield in the coming years when you consider that wine is only becoming more complex and more varied in every country where it is produced.

The four major trends mentioned above in the four main parts of the industry have one thing thing in common and it could be no other way: The consumers’ actions and desires have driven all the trend. And this should tell us all that in the coming two decades we only have to guess what the consumer will do and want and how they will act to have a precise idea of what will happen in the wine industry.

 


13 Responses

  1. Terroirist: A Daily Wine Blog » Daily Wine News: Less Glamorous - September 5, 2013

    […] Wark details “The 4 Key Trends in the Wine Industry in the Past 20 Years.” His conclusion? “The consumers’ actions and desires have driven all the […]

  2. Thomas Pellechia - September 5, 2013

    Tom,

    You forgot the fifth major trend: all encompassing, all knowing, all opinionated, all the time, wine blogs!

  3. Tom Wark - September 5, 2013

    Thomas,

    Believe it or not, that falls under Educating The Consumer.

    • Thomas Pellechia - September 5, 2013

      Gimme a break!

  4. Carl - September 5, 2013

    I think the major change in the last 20 has been the trend to make wine with raisins instead of grapes.

  5. Jonathan O'Bergin - September 6, 2013

    Regarding Parts II-IV: The single greatest trend in the American wine industry in the last twenty years (1993-2013) has been the influence of Robert Parker. This is also true of the industry world wide. The race to homogenity has been fed by the globalization of wine consulting (oenological).
    As for Part I: The greatest trend has been to eschew the misdirection of the viticultural advice given by UCDavis (AxR anyone?) and embrace the reality of both a rapidly changing climate and the greater wisdom of proven agricultural methodologies.

  6. harvey posert - September 6, 2013

    the overriding trend is table wine growth, pursued by thousands of producers, trade and consumers; and we will not see the end of it soon. underdeveloped markets such as urban, latino and oriental are accelerating, while the basic domestic market continues to grow as consumers learn that it doesn’t have to be expensive — or “recommended” — to be good.
    harvey

  7. Robert - September 6, 2013

    Growth of Imported Wines: In 1999, imports were 18% of the US wine market. Last year, they were 35%. By decade’s end, they are projected to hit 50%.

    All of this despite several factors that should have slowed or reversed their growth: the anti-French backlash of 02-03. The collapse of the dollar against the Euro in 03-06. The effects of the financial meltdown on high end wine (imports market share is actually higher based on value than on gallons) after the financial crisis.

    Despite all of this, imports have marched steadily and consistently for the last decade and a half towards increasing market share.

  8. Samantha Dugan - September 6, 2013

    Have to concur with Robert here. In our shop the imports are, for the first time in 18 years, outselling the domestic wines and that trend seems to be growing and shows no signs of leveling off, here at least. I think there are several reasons, the aforementioned raisin wines and I point to the consumer education aspect. For years people would wander into The Wine Country asking for something and when I would walk them to France they would blurt out, “Oh no, not French wines, those are too expensive” and now, now we sell more wine at a freaking Loire Valley class than we do at a Napa, Sonoma or even Santa Barbara tasting, people loving the freshness of those wines but mostly floored by how much you can get for $15.00…..can’t say that about domestic wines as often I’m afraid.

    I’d love to see a list of the most annoying trends…..I’d like to start with the gender specific labels please.

  9. Thomas Pellechia - September 8, 2013

    “…most annoying trends…”

    Moscato–but only until the next “hot” wine.

  10. Jim Lumbers - September 8, 2013

    The fact that the same trends can be observed in Australia suggests that Tom may be a little narrow in his interpretation of the causes, especially in crediting the consumer as the underlying driver. Equal credit should go to the producer, especially the new wave of consumers-turned-producers, i.e. hobbyists becoming professionals. Their quest for quality (usually at the expense of economics) has spurred both the search for better sites and the production of distinctive, varietal-flavoured wines. The result has been an astounding increase in overall wine quality to the extent that it is actually quite rare to find a defective wine. Except, of course, from cork taint. Fortunately, in Australia, that too has been virtually eliminated due to the near universal adoption of threaded capsule seals.

  11. Good Reads Wednesday « Artisan Family of Wines - September 11, 2013

    […] http://fermentationwineblog.com/2013/09/the-4-key-trends-in-the-wine-industry-in-the-past-20-years/ […]

  12. Amuse Bouche | Edible Arts - September 13, 2013

    […] 4 Key Trends in the wine industry over the past 20 yrs. […]


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