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EXCLUSIVE: Leading Premium-Plus Wine Players Drive U.S. Growth

August 17, 2015

Benefiting from robust premiumization trends, the U.S. market’s leading wine brands priced at $10-and-above are posting solid growth and outperforming the overall category. The total domestic and imported premium-plus wine segments each rose roughly 4% in 2014, and the top 15 domestic players were up 5.7%, to around 27 million nine-liter cases, according to Impact Databank. Growth was even more pronounced for the market’s top five premium-plus imports, which collectively rose 11.2% to 4.3 million cases last year.

“Overall, premium wines are performing well in the U.S. In the past year, all premium wines have been growing more than 10% and trends continue to improve,” says Rich Kranzmann, vice president of E.&J. Gallo Winery’s premium business unit, citing IRI data for the 52 weeks ended June 21. “Premium wines have recently overtaken popular- and lower-priced wines in total dollar market share.”

California continues to dominate in the premium-plus domestic segment, led by Kendall-Jackson, which remains the U.S. market’s largest premium-plus entry at more than 3.1 million cases, despite declining 2.5% last year. Still, two of the fastest-growing premium-plus offerings last year—including second-largest domestic brand Chateau Ste. Michelle (+10.2%) and portfoliomate 14 Hands (+20.7%)—hail from Washington state. Other domestic premium-plus standouts include Trinchero’s Ménage à Trois (+12.2%), Bogle Vineyards’ namesake brand (+13.8%) and E.&J. Gallo’s Apothic (+19.4%), all of which have been bolstered by the ongoing red blend craze.

On the import side, the five largest premium-plus labels all posted growth last year, including Constellation’s Ruffino (+13% to 1 million cases) and Kim Crawford (+19%), Gallo’s Alamos (+3%), Riboli Family Wine Estates’ Stella Rosa (+22%), and Santa Margherita (+1.4%), which will move from Terlato Wines to its own U.S. subsidiary January 1.

“Italian wine continues to premiumize and outpace the category, led by sparkling wines, primarily Prosecco and Moscato d’Asti, as well as super- and ultra-premium Pinot Grigio,” notes Scott Ehrlich, Constellation’s global marketing director of imports. Within the retail channel, Ehrlich adds, white and sparkling wines now account for around 60% of Italian wine sold in the U.S. in terms of dollar sales.

For a full report on the U.S. market’s top premium-plus wine brands, see the August 1&15 issue of Impact.

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