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Delicato Family Vineyards Achieves Torrid Growth With Value-Oriented, Creative Concepts

October 25, 2011

Despite the weak economy, Delicato Family Vineyards (DFV) has seen steady growth across most of its portfolio. “The economic downturn actually has helped us, in terms of having products in the $5-$20 range that we focus on strategically,” says DFV president and CEO Chris Indelicato. “It has allowed us to pick up a lot of business as people seek out value.”

DFV’s growth run of recent years has seen it win Impact “Hot Brand” awards for its two biggest brands, Bota Box (about $19 a 3-liter box) and Gnarly Head ($11.99 a 750-ml.). After depleting 941,000 nine-liter cases last year, Bota Box is projected to exceed 1.5 million cases for 2011, according to Impact Databank. DFV recently launched its varietal line (except Malbec, Shiraz, Riesling and Redvolution) in Tetra Pak cartons while also adding a Moscato, all retailing at $4.99 a 500-ml.

Gnarly Head, meanwhile, grew by nearly 20% last year, surpassing the 500,000-case mark. This year its growth is projected at 21.1% to 610,000 cases. Last month, DFV added a new product to the Gnarly Head lineup—Authentic Red, a Zinfandel-based red wine priced comparably to the rest of the line.

While those two brands continue to prosper, some of DFV’s smaller players are showing impressive growth. The company recently won Impact “Hot Prospect” awards for its Noble Vines label ($13.99 a 750-ml.) and for Irony ($14.99). Noble Vines, formerly known as 337/181, grew by 32.5% last year to 151,000 cases and is projected to rise by 44.7% this year to 219,000 cases. Irony was up 47% to 87,000 cases last year, and is forecast to reach 110,000 cases in 2011, a 27% jump.

“Consumers are continuing to trade down a bit, seeking out really good wine in the $12-$15 range, so it’s been very helpful for us to have brands at that tier,” Indelicato says. Both brands also perform well in the on-premise, Indelicato adds, and attract a fairly broad swath of consumers. “We see a wide range of age groups purchasing these wines, from the millennials through to baby boomers,” he notes.

But while DFV is seeing growth for much of its portfolio, one brand that has struggled is Domino ($6.99), formerly known as Delicato. Its case depletions decreased in every year from 2005-2010. It depleted 337,000 cases in 2009 and then fell to 285,000 cases last year. This year, aiming to restore growth, DFV changed the brand’s name from Delicato to Domino and unveiled new packaging. “We knew we had to repackage and reposition the Delicato brand in order to remain competitive,” Indelicato explains. “Once we determined that the growth of this segment is coming from contemporary brands, the decision was made to move to a more modern style.” The move appears to be paying off, as Domino has halted its slide and is projected to be up 1.6% this year, to 290,000 cases.

DFV Wines – Top 10 Brands
(thousands of nine-liter case depletions)
Percent Change*
Brand 2009 2010 2011E 2009-2010 2010-2011E
Bota Box 656 941 1,548 43.5% 64.4%
Gnarly Head 422 504 610 19.3% 21.1%
Twisted 200 239 333 19.6% 39.4%
Domino** 337 285 290 -15.3% 1.6%
Noble Vines 114 151 219 33.4% 44.7%
Irony 59 87 110 46.9% 27.0%
King Fish 78 56 46 -28.7% -17.9%
Loredona 34 37 39 8.6% 5.9%
Brazin 17 28 34 69.2% 18.2%
Massimo 1 32 + +
*Based on unrounded data.
**The Delicato brand was renamed Domino earlier this year.


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