Exclusive news and research on the wine, spirits and beer business

King Estate On The Bright Future For Oregon Wine

October 6, 2017

King Estate has been a key contributor to the growth of the Oregon wine category over the past few years, led by its namesake label and portfoliomates Acrobat and North by Northwest. Based in Eugene at the southern end of the Willamette Valley, the winery’s ascent has come as Oregon’s global shipments have ballooned to 3.2 million cases, with much of that volume coming from the $15 and above segment.

Retailing at $13-$20, the Acrobat brand in particular has gained traction, quadrupling in size to 145,000 cases from 2010-2015. While Acrobat was roughly flat last year, King Estates cofounder and CEO Ed King says the brand is back in double-digit growth in 2017, with year-to-date gains at about 15%. The majority of Acrobat’s volume comes from its Pinot Gris, although Pinot Noir is a close second. The lineup also includes a Rosé of Pinot Noir and a limited edition Chardonnay.

King Estate’s eponymous brand ($10-$29), now at about 118,000 cases, is targeted predominantly at the on-premise. Additionally, the winery’s only Washington-based label, North by Northwest ($15-$50), grew by 24% last year to roughly 36,000 cases.

The company recently launched a new unit, King Vintners, led by next-generation King family members and staff, alongside a new brand called Next. Released in June, the new Pacific Northwest–centric Next wines are available exclusively on Amazon, ranging from $20 to $40 a 750-ml. Though King sees success in having an Amazon-exclusive label, he’s cautious regarding the future of e-commerce for the wine business.

“We like being innovators and think it’s important to be aware of all the channels available,” says King. “But frankly, wine is not necessarily the optimum product for online sales. It makes sense when people are looking for a particular wine, or a special gift. I think Amazon themselves seem to recognize that the three-tier system and wholesale distribution will continue to be the main channel.”

Looking ahead, King expects Oregon wine to continue to rise on the global stage. “To see people from great businesses in California, France and other regions come to Oregon and participate is proof of concept that Oregon wines are not just here to stay, but at some point, will be recognized as among the very best on the planet as well,” he says. “And yet, we’re still small. We’re not homogenized yet. There’s a lot of variation and variety and creativity. That’s the most exciting part about Oregon.” —Julia Higgins

Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.

Tagged : , , ,

Get your first look at 2020 data and 2021 projections for the wine and spirits industries. Order your 2021 Impact Databank Reports. Click here.

Previous :  Next :