Plain talk about how the wine industry is (actually) doing very well
Or, the rain in Spain falls mainly in the plain
The wine market, according to the news all around us, is so far down that no one knows what’s up. Almost.
That’s why I enjoyed reading Tom Capo’s latest piece in Wine Enthusiast entitled “There’s Still Hope for California Wine, According to Industry Veterans.” The industry vets Capo interviews are Bob Cabral (Bob Cabral Wines), Marimar Torres (Marimar Estate), and Tom Klein (Rodney Strong Vineyards).
Everyone in any business related to wine needs to read this because what these three old hands (nothing wrong with being old!) provide is wise and sensible perspective. Unlike the seemingly endless number of (mostly self-appointed) industry pundits who keep screaming, “The sky is falling!” No, it’s not. Depends on where you’re standing.
The key is understanding where the opportunities lie, because there are plenty of them. In another recent, and short and sweet, article in Elite Traveler, Ellys Woodhouse put out a piece entitled “Americans Are Spending More Money on Wine Than Ever.” I don’t think you can put it any plainer than that.
Woodhouse bases her observation on the latest (2026) Bank of Montreal (BOM) Wine Market Report showing that Americans are spending more than ever on wine, reaching an all-time high of $115 billion in sales in 2025. Comments Woodhouse, “This represents a three percent increase over the last year, and, despite the pandemic, tariffs, and economic instability in between, a growth of $40bn compared to 2018.”
Does this sound like the sky is falling?
Last week I received a correspondence from Ridgely Evers, owner/grower of DaVero Farms, a 100% DTC brand. I came to know “Ridge” because he sources and produces widely distributed wines from Biodynamic grown Vermentino and Sangiovese from Lodi and sold under the AVIVO brand, currently priced at $24 retail. Seven years ago these wines retailed across the country for $18, but prices have been adjusted because 1) costs have increased, and 2) $24 represents a current market “sweet spot,” although according to Evers, “the typical street retail price falls between $17.99 and $19.99, with BTG [prices for restaurants] at between $10 and $12,” also falling in sweet spots.
In the restaurant industry we’ve always done the exact same thing: Even if you made your profit margin by pricing a wine on your wine list at $40, if customers refuse to buy it for $40 then you have to mark the exact same wine at a price point where they will buy it⏤at, say, $55 or even $65. Don’t talk to me about “rip-off” or “overpricing.” In the restaurant business it’s all about reality. You sell your wine at a price point where it can be sold; not more, not less. If you don’t, you’re an idiot, and your restaurant is likely to go out of business.
In any case, Evers shared three graphs which summarize the reality of the wine market in general. First, the “bad news”⏤the recent drop (currently, at 2014 levels) in overall wine sales in terms of millions of cases sold:
Second, the market segments in which wine sales have actually been dropping (wines retailing for $15 or less), compared to the segments where wine sales are either slightly ($15-$30 retail) or significantly (over $30 or $50 retail) increasing in recent years:
Third, because Evers conceived his AVIVO brand based upon the forecasted growth of wines perceived as “organic,” particularly appealing to younger consumers now entering the market, he shared a graph showing the steadily increase of sales of such wines, recent past, current and near future:
As I repeat over and over again, successful sales are always dependent upon paying attention to what consumers actually want. The trick is, what they want may not be exactly what you think it is, especially in a rapidly shifting or evolving market.
Wine is still greatly appreciated, just as it has been for thousands of years. The difference is that many consumers are moving away from predictable, mass production wines that they can’t identify with their current outlook on life in general. Not all of them, of course, but a growing number of them.
Whether you are a grower, a producer, a retailer or restaurateur, you make your choices on what market segment you want to target. It’s sink or swim. Then again, it’s always been that way. If anything, I think Mr. Klein hit the nail on the head in his short interview with Capo by citing the factors—namely, quality from the ground up—that grew the American wine industry in the first place:
Growth can be exciting, but it must be rooted in quality. You need to invest in top vineyards and focus every decision aimed at creating better wine and experiences. Increasing volume without a dedication to excellence doesn’t benefit the consumer or the industry in the long run.
