Stateways March April 2018

StateWays is the only magazine exclusively covering the control state system within the beverage alcohol industry, with annual updates from liquor control commissions and alcohol control boards and yearly fiscal reporting from control jurisdictions

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StateWays | | March/April 2018 22 2018 GROWTH BRANDS - WINE W ine consumption in America increased again during 2017, growing 1.3% to 345.7 million 9-liter cases. This comes after a total of 341.1 million cases in 2016, which itself represented a 2% volume growth over 2015. That puts 2017 in line with recent growth trends. The U.S. wine category has had 1% to 3% annual growth rates dating back to 2011, when the country fi rst began to emerge from the Great Recession. What's behind this recent growth? Millennials play a large part. They are an explorative group, a generation more inter- ested in trying new fl avors than adhering to one style or one brand. Look for younger LDA consumers to continue buying across different categories, countries and varietals of wine. How do you capture their attention? Labels are as important as ever. Millennials care less about where a wine is from, and more about the eye-catching art, the brand story and the specifi c varietal inside. Savvy brands like The Prisoner and 19 Crimes have increased sales with labels that stand out and invite customers to explore the stories behind the brands. This past year, 19 Crimes even used an augmented reality cell phone app to bring to life the historical criminals depicted on its labels. In terms of wine styles in 2017, sparkling wines remained red hot, driven by rosé. The days of rosé being a woman's drink, sipped only in warm months, are long gone. Rosé is now a year- round beverage, enjoyed by men and women alike. This trend has trickled into prosecco, champagne and other bubblers. They have overcome old reputations as wines meant only for holidays and special events. Now, anytime of the year is appropriate to pop open some sparkling wine. No end is in sight for the bubbly boom. Same for the rise of red blends, especially from California. These have become a go-to purchase for many U.S. consumers. People who may not know their varietals or regions can still feel safe buying a California red blend, since they are familiar with the quality and rich, fruity fl avors. It's hard to go wrong in this category, which is why it remains on the upswing. Brands have continued to tap into social media to connect with consumers. Instagram and Snapchat campaigns are reliable ways to put brands before the eyes of con- sumers. Another way for savvy brands to stick out is partnerships with charitable causes. This is a win-win. Brands gain positive publicity for helping a worthwhile cause (and plenty of social-media content) while also driving attention towards a deserving charity. Brands that connect with consumers this way will be among those who win Growth Brands Awards this year and in those to come. ESTABLISHED BRANDS Many long-successful wine brands enjoyed another year of growth in 2017. Ménage à Trois, from Trinchero Family Estates, continued its climb up the sales charts, with 2.7% VINO INNOVATION BY KYLE SWARTZ WINE ESTABLISHED GROWTH BRANDS (000 9-liter cases) '16/'17 Brand Supplier 2014 2015 2016 2017p % Change Woodbridge by Robert Mondavi Constellation Brands 9150 9300 9750 9760 0.1% Liberty Creek E&J Gallo Winery 3010 3475 3940 4415 12.1% Apothic E&J Gallo Winery 2130 2450 2920 3268 11.9% Menage a Trois Trinchero Family Estates 2474 2700 2823 2900 2.7% Ruffi no Constellation Brands 1025 1130 1250 1310 4.8% Barefoot Bubbly E&J Gallo Winery 1150 1170 1198 1236 3.2% J. Roget Constellation Brands 777 850 920 1000 8.7% Taylor Dessert Constellation Brands 814 820 840 950 13.1% Cupcake Sparkling The Wine Group 475 350 600 635 5.8% Nobilo Constellation Brands 500 560 615 620 0.8% Real Sangria (Cruz Garcia - Real) Shaw-Ross Int'l Importers 560 585 611 615 0.7% Simi Constellation Brands 550 590 600 610 1.7% Noble Vines DFV Wines 463 549 556 608 9.4% Decoy Duckhorn Wines 332 406 483 587 21.5% Starborough E&J Gallo Winery 370 400 455 522 14.7% Raspberry Sparkletini Carriage House Imports 347 386 390 421 7.9% CK Mondavi & Family CK Mondavi & Family 338 366 402 406 1.0% Source: The Beverage Information & Insights Group (p) Preliminary.

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