2022 Slower but 'No Nosedive' for Wine DtC

That's the conclusion of the 2022 Direct-to-Consumer report by Wine Direct and Enolytics.

Last year's first quarter was essentially an extension of the Covid recovery year.  DtC showed positive net growth in the second and third quarters. Average Bottle Price was up and, relatedly, Average Order
Value (AOV) was up 5%. Average Bottles Per Order was also up, and Discounts were down.  

The Wine Club channel grew more than 20% in 2022, tasting room net sales were flat and website sales continued to decline.

The report also contains an interesting chart which shows the difference in generational buying between 2018 and 2022.  In 2018, as you would expect, Baby Boomer (1944-1964) accounted for the largest percentage of net sales (49%).  But in 2022, the Boomers' contribution to net sales had slipped to 40% – still the largest percentage, but clearly lower.  Meanwhile, for Gen Z, Millennials and Gen X, sales were clearly higher in 2022 that in 2018.  The Silent Generation, those born before 1944, saw a greater contribution to net sales (3%) in 2018 than in 2022 (2%).

Another interesting factoid in the report is that men accounted for a greater percentage (58%) than women (42%) in 2018.  That remained true in 2022, when men represented 54% of cases sold compared to women (46%).

Women account for 60% of wine sales under $20;  But once you pass the $30 price point, men make the decisions – at $30 to $49, men account for 51.6% of sales; that percentage increases steadily; at $90 and above, men represent 73% of all sales.  This obviously has implications on how wine might be marketed, not only by DtC sellers but also by vintners in general.

With all the data in the report, Wine Direct and Enolytics suggest sellers adopt a three fold strategy.

First, develop an omnichannel strategy. That means, the report says, that not only should you be present in all channels, but you should ensure that all channels work together to provide consumers "a seemless shopping experience."

Second, consider how you will target younger and more diverse consumers. The report notes that its data shows that younger consumers skew more heavily toward onsite purchases, lower priced wines and drink a variety of wines, including both White and Roses.  

The third step is to focus on retaining your wine club members. Wine club sales drive overall DtC results.  But last year's fourth quarter saw a negative net growth rate, driven by lower sign up rates and the highest attrition rates seen in over five years.  

You can access a copy of Wine Direct's "Direct-to-Consumer Report" here.