December 2015 Issue of Wines & Vines
 
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The Best of 2015

Best Varietal Sales, Best Wine Region by Bottle Price, Best Direct-to-Consumer Sales and the Most-Read Stories of the Year

 
by Wines & Vines Staff
 
 
Willamette Valley Vineyards
 
Wines made from Oregon grapes such as those from Willamette Valley Vineyards (shown) commanded the hightest price per bottle in 2015.

The editorial staff of Wines & Vines toasts 2015 with this special feature that includes reports on the best sales by varietal, best growth by wine package type, best direct-to-consumer market and even the best day to buy wine online. The section also includes the most-read stories published on winesandvines.com and in the pages of the print magazine. Much of the data used to determine what was the best comes from Wines Vines Analytics, IRI and ShipCompliant. Most-read articles were determined by metrics.


SALES


Best Growth by Type
SPARKLING WINE
Sparkling wine sales grew twice as fast as table wine this year in the off-premise channel, according to market-research firm IRI. Counting imports and domestic sparkling together, the category gained 12% in value and 9% in volume, compared to 6% and 2% for table wine. Moreover, sparkling wine sales passed Pinot Grigio/Gris sales to become the third biggest wine varietal or type in the multiple-outlet and convenience stores tracked by IRI. That meant only Chardonnay and Cabernet Sauvignon sold more. Domestic sparkling wine grew by a respectable 9% in value and 6% in volume, but imports stole the show as they rose by 17% and 15%, respectively.


Best Brand
BAREFOOT
Barefoot, a brand of E. & J. Gallo Winery, was far and away the off-premise sales leader in 2015. It led second-place Sutter Home by 44%. Barefoot’s sales grew by 6% as the average bottle price dropped by 2% to $5.61. The brand’s strength was apparent particularly when compared to performance of the $5-$7.99 domestic table wine category as a whole, which grew only 1% in sales.


Best Bottle Price by Varietal
ZINFANDEL
Collectible Cabernet Sauvignon from Napa Valley gets a lot of attention for pushing the price envelope upward, so it may seem surprising that the varietal with the highest average bottle price in U.S. off-premise outlets is the California heritage variety, Zinfandel. Zin grew by only 4% in sales and 1% in volume, but it averaged $11.24 per 750ml bottle, which was 35 cents more than a year ago.


Best Bottle Price by Region
OREGON
With an average bottle price of $14.52, Oregon led all major wine-producing states and import countries. The price of Oregon wines went up 31 cents per bottle, while also increasing in sales dollars by 13% and volume by 11% in off-premise stores measured by IRI. Oregon’s emphasis on high-priced Pinot Noir and the non-existence of wines under $10 helped the average stay high.


Best Growth by Package Type
PREMIUM BOX WINES
Bag-in-box wines at the premium price range of $3.50 to $4.99 per 750ml equivalent were the hottest package type in terms of sales growth, according to IRI. These grew by 24% in both value and volume. The majority of premium boxes were 3 liters in size. In contrast, 5-liter boxes grew only 1% in value and dropped by 4% in sales volume.


Fastest Growing Import Category
NEW ZEALAND
A 27% increase in U.S. off-premise sales made New Zealand the hands-down winner among import countries. It has only 2% of market share, according to IRI, but a fast-growing following among consumers, along with a high average bottle price of $11.53. Sauvignon Blanc is driving these sales, and New Zealand Sauvignon Blanc is responsible for much of the rapid growth in the varietal category as a whole.


Fastest Growing Varietal
SAUVIGNON BLANC
Domestic Sauvignon Blanc and Fumé Blanc wines had the fastest rate of growth in direct-to-consumer (DtC) shipments among the 10 top varietals and types. Sales increased 19% in 2015, according to the Wines & Vines/ShipCompliant Model, and totaled $47.2 million. Cabernet Sauvignon remained the top-selling varietal or type and grew by 17%, which was impressive considering its much larger base.


Fastest Growing DtC Market
MASSACHUSETTS
Consumers in the Bay State lost no time taking advantage of legislation that allowed open access to direct-to-consumer shipments of wine beginning Jan. 1, 2015. Through September, they received 40,268 cases of wine worth more than $18.91 million from U.S. wineries, according to the Wines & Vines/ShipCompliant Model. That more than doubled the previous year’s total, for a growth rate of 129% from a small base of $8.27 million. Only bonded wineries are able to apply for a direct-shipping permit, which costs $300 and $150 to renew. Consumers are limited to a dozen 9-liter cases per year.


Most New Wineries
CALIFORNIA NORTH COAST/OREGON
The majority of new wineries continue to open in California, but the Pacific Northwest is starting to take a larger share of that growth. The region with the most new wineries (139) was California’s North Coast, which includes Napa, Sonoma, Lake and Mendocino counties. Napa County recorded 78 new wineries, and Sonoma County had 56 open this year. After California, the most new wineries opened in Oregon, which opened 93, according to Wines Vines Analytics. Of the new Oregon wineries, 78 are located in the Willamette Valley. Oregon’s neighbor to the North, Washington state, had 61 new wineries; the Pacific Northwest combined accounted for 22% of all new wineries. The rate of growth in the Midwest and eastern United States is still much smaller, but those two regions combined accounted for 38% of all new wineries. Outside of the Western United States, New York had the most new wineries at 39, and 11 of those were in the Finger Lakes region.


FLASH


Flash Site With Most Offers
INVINO
In total number of offers, Invino led all other flash websites by a wide margin. During the past 12 months through September, the website made 1,598 offers for domestic wines. Invino’s offers increased 22% over the same period from the previous year. The website with the next highest number of offers was Last Call Wines, which made 1,121 offers this year.


Flash Site With Best Offer Diversity
LAST BOTTLE WINES
Based on the number of offers from different wineries, Last Bottle Wines had the greatest offer diversity in 2015. The website’s 399 offers came from 193 unique wineries for a winery-to-offer ratio of nearly 1:2, which was the highest of all the major flash sites. Cellar Angels had a much higher ratio, but the website made only 55 offers in the past 12 months. Last Call Wines accounted for one of the highest offer counts in the past 12 months at 1,121, but those came from only 177 different wineries.


Flash Site with Largest Increase in Offers
RUE LA LA
Rue La La offers grew the most in the past year, doubling from 158 to 316. The website offers a variety of luxury goods and frequently offers many bottles from the same winery. Last Bottle Wines’ total offers grew by 62% (from 247 to 399). Wine Spies’ offers grew by 54%, and Wine Woot’s increased by 42%.


Best Day for Flash Offers
MAY 24
Not only is it the leader by total number of flash offers, Invino is also is the leader for most flash offers posted in a single day of 2015. The website’s biggest sales push came May 24, when Invino posted 178 offers for domestic wine as part of a special event. Labor Day Weekend also proved to be a busy period for flash websites: Wines Vines Analytics tracked 235 wine offers Sept. 6-7. June 3 was not a good day for finding a flash deal, as there were only four offers for domestic wines.


Best Flash Deal
2010 JOSEPH PHELPS CABERNET SAUVIGNON
Consumers have flocked to flash wine websites for the cheap prices as well as the chance to snatch up rare wine gems. The Five Best Flash Deals are for some of the most expensive wines offered by flash websites in the past 12 months through September 2015. Screaming Eagle Winery would have accounted for almost all of the priciest offers, so we picked five different wines with the highest winery retail prices.

Of course, quality isn’t just determined by price. Wines Vines Analytics also tracks whether a wine offer includes a 90 or higher score from the Wine Enthusiast and Wine Spectator magazines or The Wine Advocate and International Wine Cellar newsletters. The five wines in the Five Best Flash Deals table all had high retail prices, good discounts and at least one 90+ score. The wine with the highest retail price, a discount of 32% and three scores of 95 or higher was a 2010 Joseph Phelps Cabernet Sauvignon that sold for $154.97 (original price $229) by flash site Wired for Wine.


EDITORIAL


Most Pageviews at winesandvines.com
GALLO, BAREFOOT DOMINATE OFF-PREMISE SALES
by Wines & Vines staff,
July 15, 2015

The July 15 story “Gallo, Barefoot Dominate Off-Premise Sales” attracted more pageviews than any other article published on wines­andvines.com during 2015. The item highlighted the growing divide between high-volume value brands and high-end wines with low production levels. According to the report, based on data from market-research firm IRI, five wine companies account for an amazing 80% of off-premise wine sales in the United States.

E. & J. Gallo Winery, which produces the No. 1 off-premise brand Barefoot, posted sales worth $1.13 billion in the stores measured by IRI during the 52 weeks ending June 14—a 5% increase over the previous 52 weeks. Gallo also produces Apothic, a red blend that launched onto the Top 20 list of off-premise brands with $128 million in sales during the same time frame.


Best-Read Vineyard News
CALIFORNIA REPORTS EARLY BUD BREAK
by Jane Firstenfeld, Feb. 2, 2015

As 2015 draws to a close, January may seem like a distant memory. But for some growers in California’s coastal regions, the month was one for the record books. Fourth-generation grapegrower Jennifer Thomson saw several unpruned vines showing signs of bud break during the final week of January 2015—at least six weeks ahead of schedule.

As Thomson led a crew of four to finish pruning her family’s 90 acres in the Carneros AVA, she noted that seeing bud break in late January is “stressful for growers, labor and vines.”

Sandy Newman, owner of Cebada Vineyard in Lompoc, Calif., reported bud break on pre-pruned canes of Pinot Noir and Chardonnay—more than two weeks ahead of schedule for that area. And Chris Hammell, vineyard manager for Bien Nacido and Solomon Hills Vineyards in the Santa Maria Valley, said, “We had fairly widespread regrowth after harvest, primarily from the tops of the shoots/canes. This is very unusual. We are seeing bud swell early, as of Feb. 1, in our warmest sites.”

In line with these developments, an early season followed for most California grapegrowers, with some noting their earliest harvest dates ever.


Best-Read News of 2015
VALLEY FIRE DEVASTATES LAKE COUNTY
by Paul Franson, Sept. 14, 2015

Bad news travels fast, and the most-read breaking news story of 2015 was a timely report about the 67,000-acre wildfire that claimed four civilian lives, forced the evacuation of 13,000 residents and destroyed nearly 2,000 structures including Shed Horn Cellars, a 3,000-case producer of Lake County wines in Middletown, Calif.

In “Valley Fire Devastates Lake County,” contributing editor Paul Franson wrote that the early harvest experienced in much of California’s North Coast may have saved the wine grape crop in the county, since a large portion of the crop had already been harvested when the fire started Sept. 12. Lake County crushed 38,574.4 tons in 2014, according to the USDA’s California Grape Crush Report.

While most of Lake County’s planted acreage was undamaged by the fire, Wines & Vines later learned that about 10 vineyards were impacted, with reports ranging from heat-injured leaves to trunk damage and vine charring. Vineyard owners also reported damage to infrastructure including irrigation systems, water pumps, trellising, fencing and tractors. Road closures restricted access for picking crews during harvest, and the area experienced widespread power outages.


Most Popular Technical Spotlight
BUENA VISTA WINERY
by Andrew Adams, May 2015

The renovation of a historic Sonoma Valley property was the most-read Technical Spotlight of 2015. The end of construction coincided with the earthquake that rocked the San Francisco Bay Area in the early hours of Aug. 24, 2014. Luckily Boisset Family Estates, which purchased the property in 2011, had installed a steel skeleton inside the structure’s 150-year-old stone walls as part of the renovation, which kept the previously decrepit property from crumbling to the ground.

“This would have been the story of the Napa quake. It would have been how this historic winery collapsed, because there’s no doubt these walls would have fallen in,” Tom Blackwood, the winery’s general manager and director of retail operations, told Wines & Vines associate editor Andrew Adams.

Instead, Buena Vista Winery made it through the earthquake unscathed, clearing a path for the once-dormant brand to reclaim the vision set by its founder, Count Agoston Haraszthy, who is credited with bringing hundreds of vinifera cuttings to California and fostering the state’s wine industry.

Technical Spotlight is a regular feature Wines & Vines debuted in 2011 to highlight new wineries, existing brands moving to new properties and innovative wine producers using new technologies to increase quality, yields and consumer interest. The monthly feature includes a listing of suppliers used for winery construction, crush equipment, wine packaging and other elements.


Best-Read Harvest Story
GROWERS SUFFER LOW YIELDS IN PASO ROBLES
by Andrew Adams, Oct. 8, 2015

Wine grape growers around California reported diminished yields in 2015, following three years of bumper crops. The Paso Robles AVA on California’s Central Coast was hit hardest of all—vineyard owners reported average losses of up to 50%.

Cold weather in May prevented pollen tubes from fully forming and caused forming grape clusters to retain their caps, which prevented the flowering necessary for pollination. Dr. Lowell Zelinski, founder of Precision Ag Consulting, said the region’s Syrah crop was “mostly devastated,” and yields of Cabernet Sauvignon, which many winemakers in the area believe could be the region’s “signature variety,” was significantly reduced as well.

Zelinski explained that years of drought also caused salt to accumulate in the root zone in many vineyards, contributing to low yields along with a hailstorm that hit the area in mid-June. He encouraged growers in the Paso Robles region to check their vines for primary bud necrosis, as discovering the malady would influence vineyard pruning decisions.


Best-Read Real Estate Story
DIAMOND MOUNTAIN WINERY SOLD
by Paul Franson, April 8, 2015

Nearly back-to-back announcements of major winery transactions drove a host of readers to winesandvines.com, making “Diamond Mountain Winery Sold” the best-read real estate story of 2015. Rudy Von Strasser sold his 35-acre property in Napa Valley’s Diamond Mountain District, including 15 acres of vineyards and a winery. The winery’s namesake retained ownership of the inventory and Von Strasser Winery brand, saying he planned to lease back the winery, cave and tasting room through the end of 2016.

The Von Strasser purchase came just two weeks after Judy Jordan announced the sale of her J Vineyards & Winery to E. & J. Gallo Winery. Jordan founded the Healdsburg, Calif., winery in 1986, and the 150,000-case producer became widely recognized for its sparkling offerings. The transaction included the winery property and more than 300 vineyard acres at nine sites in the Russian River and Sonoma Coast AVAs.


Best-Read Legal Story
PLAINTIFFS UP ANTE IN ARSENIC CASE
by Peter Mitham, Sept. 29, 2015

The law firm of Kabateck Brown Kellner LLP took the California wine industry by surprise and news outlets by storm March 19, when it filed a lawsuit in California Superior Court claiming several wineries in the state produce and sell wines containing “unacceptably high levels of inorganic arsenic.” The attorneys sought class-action status for the original suit, which named 28 defendants including The Wine Group, Constellation Brands, Trader Joe’s Co., Treasury Wine Estates and Hahn Family Wines.

Six months later Peter Mitham exclusively reported on the firm’s amended complaint, with the Wines & Vines northwest correspondent revealing the original suit had been revised to seek billions of dollars in civil penalties, among other damages, stating, “Just a glass or two of these arsenic-contaminated wines a day over time could result in dangerous arsenic toxicity to the consumer.”

Citing Prop. 65 (the Safe Drinking Water and Toxic Enforcement Act of 1986, which seeks to protect consumers from more than 600 substances known to be poisonous), the amended complaint seeks wineries to pay a civil penalty of $2,500 per day for every bottle of offending wine manufactured and sold without a warning about arsenic levels. It also asks that the defendant wineries “identify and locate each individual to whom the offending wines were sold in the past four years, and to provide a warning to such person that consumption of the offending wines will expose them to chemicals known to cause cancer.”

The San Francisco, Calif.-based Wine Institute calls the complaint “unfounded,” telling Wines & Vines, “The fact that the California lawyers who filed the bogus arsenic in wine lawsuit have amended their complaint with a Prop. 65 violation only serves to underscore that financial gain—and not consumer safety—is their motivation. The lawsuit is without merit.”

The University of California, Davis, released a fact sheet about the topic, which concluded: “It would take inordinately high consumption of wine that coincidentally had high levels of arsenic to come close to the 0.3 μ g/kg body weight per day level of concern” set by the Environmental Protection Agency.


Best of Wine East
PALISSAGE: AN ALTERNATIVE TO MECHANICAL HEDGING
by Dr. Justine Vanden Heuvel, March 2015

Dr. Justine Vanden Heuvel, assistant professor of viticulture at Cornell University, penned the most popular article to appear in the Wine East section of Wines & Vines in 2015. The author was awarded a grant to study the use of a hedging technique called palissage to control vine vigor in the Finger Lakes and Long Island growing regions of New York.

Vanden Heuvel wrote, “Although hedging is a widely used practice, it is considered a Band-Aid solution to excessive vine vigor in that it does not address the long-term problem of vine size.”

Palissage involves tucking long shoot tips horizontally along the canopy, which has been shown to stop shoot growth and eliminate the need for leaf removal in the fruiting zone in some wine grape cultivars. Vanden Heuvel will continue her research during the 2016 growing season.

 
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