How Wine and Spirits Distributors Can Use Analytics to Assess How the Pandemic Affected Sales

In times of economic turmoil, the wine and spirits industry has typically been one of the most resilient sectors. Even now, with the COVID-19 pandemic ravaging the U.S. economy, sales of alcoholic beverages remain strong. However, that is not to say that the pandemic hasn’t had some profound and unexpected effects on sales.

Although it’s already been said ad-nauseum, these truly are unprecedented times. As such, sticking to current methods, or basing decisions on what worked in the past, is a recipe for failure. The best way to quickly determine what is going on, and how to respond, is to follow the data.

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Liquor Laws Change in Response to Demand for Delivery During Pandemic

Despite rising COVID-19 cases, most of the governors in the United States have lifted stay-at-home orders. But some states such as Texas have now banned bars from serving alcohol to keep the infectious virus at bay.

The unprecedented stay-at-home orders and whiplash of phased reopening starting and pausing have left customers craving their favorite cocktail, and disgruntled brands looking for new revenue streams.

In response, some state legislatures are working to change their laws to allow alcohol delivery.

Many states forbid shipping wine and spirits, halting the growth of delivery giants such as Drizly and hampering direct-to-consumer efforts from wineries and distilleries.

During the pandemic, residents tried to stay home, but the demand grew for happy hours at home and delivery. (more…)

Outdoor Drinking Venues May Replace Bars During the Pandemic

Side view of beautiful young couple sitting at the table and clinking glasses of champagne. Charming lady enjoying romantic date with boyfriend at rooftop restaurant with night cityscape on backgroundWhile the COVID-19 pandemic has not slowed down purchases of wine and spirits from liquor stores and online vendors, it did eliminate one crucial avenue of beverage sales: restaurants and other social venues. Premium wines have taken an especially big hit, since people tend to order more expensive wine when they go out, but drink the cheaper stuff at home. This shift has had a dramatic impact on the wine industry in the months since the pandemic began.

Even before the stay-at-home orders went into effect, on-premise drinking was experiencing an overall decline. But that may soon start to change yet again. Restaurants in 44 states have reopened, or are set to reopen in some capacity in the near future. While many are still rightfully cautious about the spread of disease, the months of isolation have left others eagerly awaiting the chance to go out to eat and drink, especially taking into account the pleasant summer weather.

Will people risk coming out in numbers this summer for social drinking? And how will outdoor drinking this summer affect the wine and spirits industry? Let’s examine.

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Will Wineries Ever be the Same After COVID-19?

The COVID-19 pandemic has changed the way people work, live, travel, and drink.

All 50 states have started to ease restrictions and stay-at-home orders, but the pandemic may affect the luxury wine industry for years to come. Napa Valley vineyards began opening in early June, but things will look different with social distancing measures in place and likely only local visitors.

Most wineries will now require employees and guests to wear masks, and visitors will need to make reservations. With restrictions and fear of travel, is enotourism dead? (more…)

Millennials Have No Taste for Premium Wine

Cheerful group of happy female people clinking and toasting together with friendship and happiness - young and adult women have fun eating - food and beverage celebration concept

Mom and Dad are willing to pay up for a quality cab, but their children are saying, “No more.”

Premium wine, defined as wine priced at more than $10 a bottle, is “nearing its apex as a trend, indicated by the decline in total wine sales volume,” according to Silicon Valley Bank’s annual report on the wine industry.

The category is falling because of the difficulty in passing price increases on to consumers, and too many grapes. The current global pandemic, which is resulting in record unemployment rates, isn’t helping either.

“With an oversupply and the fact that price increases are nearly impossible against the backdrop of slowing sales, the trend and mantra of premiumization that pushed volume and price higher for the past 25 years is nearing an end,” Silicon Valley Bank’s report said. (more…)

Virtual Cheers: Vineyards, Brands Host Online Events to Engage Customers

Woman drinking red wine at the restaurant and using special app in her smartphoneLast summer, it was hard to get a reservation at Wolffer’s Vineyard in Long Island, NY. As this summer approaches, the tasting room remains empty because of COVID-19, but the party is still going on.

Wolffer’s winemaker Roman Roth, whom The Wine Industry Advisor named as one of wine’s most inspiring people, now hosts virtual wine tastings for the Hamptons’ elite and beyond. It’s a trend that’s picking up across the wine industry during the COVID-19 pandemic. Let’s take a look. (more…)

Distilleries are Producing Sanitizer to Help Fight COVID-19

Distilleries across the country have stepped up their production in the face of the COVID-19 pandemic. But the increase is not just due to a rising demand for alcoholic beverages. These distilleries have begun producing sanitizer products to help prevent the virus from spreading.

While this might sound strange at first, it actually makes a lot of sense. Ethanol, the type of alcohol used in beverages, is also the primary ingredient in most sanitizers. The stills that are used to distill the liquor are also capable of brewing up large quantities of sanitizer at once.

Many companies are facing difficulty due to complications in the process or regulations on sanitizer products. But even in the face of economic uncertainty, they are willing to take on these expenses and challenges for the good of the public health. (more…)

Quarantined Americans Drinking More Than Ever

Most of America has been under a “stay at home order” for the last six weeks because of COVID-19, the Novel Coronavirus. While Americans are confined to their homes, they’re coping by cracking open a few more bottles of wine or pouring more than just a few extra cocktails.

Americans already enjoyed drinking at home, but now that they’re forced to stay in, they are buying more alcoholic beverages online than ever before. In fact, online alcoholic beverage sales increased 387% for the week ending April 11, according to CNN. The week prior, sales were up a whopping 441%.

Online sales are not booming solely because restaurants and bars are closed. Total alcohol sales grew 26.2% compared to the same week last year, according to Nielsen. (more…)

Thinking Outside the To-Go Box: How Bars and Restaurants are Innovating During the Pandemic

Social distance conceptual small business waiter serving customer at coffee shop

Bars and restaurants – once the center of social activity for millions of Americans – have been greatly impacted by the COVID-19 pandemic. The National Restaurant Association estimates that the restaurant industry has lost more than 3 million jobs and $25 billion in sales since March 1, and the numbers keep growing.

Many in the industry have tried to adapt by converting operations to take-out only, but clearly, this is a stop-gap measure. Other bars and restaurants are taking it a step further, hoping that their innovative approaches lead to higher sales than the takeout-only approach and foster customer loyalty that extends post-pandemic. Let’s examine. (more…)