August 2006 Issue of
Wines & Vines
Innovative Packaging Ignites 50% Sales Growth
Some are calling the new wave of bag-in-box containers, screwcap closures and Tetra Paks "innovative packaging." Whatever you call them, they are driving one of the hottest trends in the wine market.
"The growth of wine sales in innovative packaging parallels that of retail sales of convenience foods," said Danny Brager, ACNielsen Beverage Alcohol Team vice president of client service. According to industry analysts, sales of convenience foods are poised to grow at double the rate of food in general. "Of the top 25 categories we track at retail, wine's overall dollar growth was No. 2, at 10%, behind only bottled water," Brager said at the Alliance for Innovative Wine Packaging's New Innovators Conference held at the Stony Brook University Center for Wine, Food, & Culture in Manhattan, N.Y. Three-liter boxed wines priced $12-$15.99 grew 105.3% in dollar volume, and those priced over $16 grew by 75.8%. (For more on innovative packaging trends, see the May issue of Wines & Vines.)
Jon Fredrikson, wine analyst and publisher of the Gomberg-Fredrikson Report, said the sales of bag-in-box and screwcap-topped wines show that wine is breaking down barriers, because people have the confidence to try the alternative packaging systems. "These brands are a good indication of the way the market is going," he said.
One of the hottest of the new brands is Three Thieves, a partnership of three Napa winemakers, Charles Bieler, Joel Gott and Roger Scommegna. Bieler said Three Thieves' total sales for the year should reach 110,000 cases in single-serve Tetra Pak, 1-liter Tetra Pak and screwcap jugs.

Boxed wines like Hardys Shiraz Grenache are just one of the options propelling innovative wine packaging to soar in sales.
According to Sally Osborne, director of marketing for Pacific Wine Partners, "We are seeing what we call 'image seekers' buying the wines," she said. "Slightly younger consumers, skewed more toward males but fairly evenly balanced."
The 1.5-liter Wine Block, introduced about a year ago, has also done well, according to Ryan Kukol, an associate brand manager for the product. The equivalent of 100,000 cases have been shipped since the wine was introduced in May of 2005. "We think it is doing very well with younger drinkers, high income consumers and college graduates," he said.
If the increase in sales of bag-in-box and Tetra Pak wines has been somewhat surprising and has generated a surge of trade interest, things have been rather quiet on the screwcap closure front.
Bonny Doon winery in Santa Cruz was the first major producer to bottle its entire line in screwcaps. Randall Grahm, the winery's president-for-life, reported that sales have grown in double digits for the past four years, including a 12% gain in 2005. The winery sold 370,000 cases of wine in 2005, all in screwcap closures.
Grahm said, "In looking back at our decision to adopt screwcaps for all of our wines, it is absolutely clear that it was the correct decision for our winery."
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