Number of North American Wineries Growing
The U.S. wine industry had a great year in 2013, and 2014 is expected to be positive as well. A report from Wines & Vines magazines found the number of North American wineries increased to 8,391 last year, which was a 4.3 percent increase from the year before. In addition to the number of wine makers, production leapt up by 6.3 percent and the average cost per bottle rose to $10.85 from $9.
California leads the U.S. with 3,674 wineries, but new regions are expanding wine production. Canada experienced an 8 percent increase in number of facilities last year. Unconventional states are quickly growing their wine production, such as Arizona, Colorado and Pennsylvania.
While these trends are largely positive news for wineries, you may need to assess how you will engage and retain customers to stay competitive. While U.S. demand for wine is increasing, wineries may find themselves with more competitors.
Direct-to-consumer, online wine sales growing
If you're looking for good news, high-quality wines are expected to increase sales this year, The Santa Rosa Press Democrat reported. In fact, fine wines priced at $20 or more are predicted to boost sales by 6 to 10 percent. Because the last two harvests have been larger than average, consumers can purchase a number of high-quality wines without incurring additional costs.
Wineries' target markets are a little mixed right now. Baby boomers are responsible for approximately half the fine wine sales in the U.S., but their purchasing power is waning, and millennials are reaching drinking age and starting to develop a taste for wine. However, this group is still finding what they like, which could make wine marketing efforts slightly more challenging.
A separate report from Wines & Vines and ShipCompliant found DTC sales are on the rise. There are a number of things you can do to encourage online wine sales, and this channel may prove to have the most growth potential. Make sure not to neglect millennials in email marketing campaigns, especially because this generation is very comfortable making purchases from the Internet. Your winery's website needs to be convenient and easy to navigate. Customer service should be just as good over the phone or Internet as it is in person. And last but certainly not least: Your e-commerce fulfillment has to be as quick and as simple as possible to build customer satisfaction.