Tom Wark over at Fermentation had a really interesting post on the state of the wine economy as measured by wine club memberships.
Tom did an informal survey of wine clubs and found that they are anecdotally reporting a drop in memberships larger than they have ever experienced in the past. With the price of gas as high as it, I’m not surprised that consumers are cutting back on “luxuries” like wine club memberships. I know my wallet doesn’t feel as thick as it used too.
Despite the drop in club memberships, we are seeing great leaps in traffic here at winescorecard.com. Of course, we are a fairly new site, and have nothing to compare to last year. Still, our traffic growth - 100% increase in the number of visits month-to-month for 4 months running - certainly implies to us that there hasn’t been a drop in interest in wine. (not that anyone thought there was)
What about restaurants? Are they starting to feel the pinch? This article seems to imply that they are.
This entry, over at the Wine & Spirits Daily, seems to imply that most in the wine business expect to weather the storm just fine. I don’t know, I would think that we will see some pressure on the mid-priced wines at the retail level - say the $20-$35 bottles? I figure the really high-end stuff is still insulated from the economic downturn, but that the middle class is starting to feel the pinch a bit more. Let us know - are you being more frugal with your wine dollar? Are you drinking less, or just buying cheaper bottles?
1 response so far ↓
1 Jon // Mar 28, 2008 at 1:53 pm
Interesting points - I have started to notice some changes are restaurants. More frequently the mark-up on a bottle I know is 100% or LESS; more people bring their own wine to dinner; and a wider price selection on the wine lists.
On your other point, while the wine market will weather the storm (I mean, if you don’t need a drink in this market you most likely have bricks of gold holding up your bed) I fear that the glut of production is going to hurt the quality of the bulk product. Although, we might find that some producers are willing to use the glut of wine to their advantage and differentiate themselves from the masses - for a higher price of course.
Finally, as for those mid-priced bottles, I am not sure that they will decrease in price. Unfortunately, as you have noted, the price of wine is one of the factors that the producer uses to differentiate its product/brand. If a good $25 bottle is discounted to $19.99, and the buyer does not know what they like or has not found this site, then most often a buyer will fall back on the you-get-what-you-pay-for line of reasoning.
my tw0 - disconnected - cents
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