Wine: consumption shrinks but purchases from the producer and online grow

Nomisma wine monitor: in a context of declining wine consumption, new cronsumption treds emerge. Growing purchase intentions directly from producers and online. Generation Z pays attention to product sustainability and health aspects with a strong interest versio i No and Low alcohol wines.

The wine market is experiencing a period that is not particularly favorable and, at the same time, characterized by important changes. Indeed, due to inflation and the economic downturn, we are witnessing a reduction in wine consumption worldwide, including Italy, and a significant revision of purchasing behavior, amidst renunciations and deprivations.

In fact, due to rising food and beverage prices (with the price of wine increasing by 3.1 percent in the last year) €6,700 per capita was lost from 2021 to the first half of 2023, with 3 out of 4 Italians having to deploy strategies and attitudes to cope with the situation, such as reducing food waste or increasing promotional purchases.

Specifically, in the first 9 months of 2023, wine sales in Italy's large-scale retail trade contracted by more than 3 percent in volume, while the HORECA channel - while registering positive trends - is slowing its growth due to lower tourist flows than last year and a reduction in the frequency with which Italians treat themselves to lunch or dinner away from home.

How wine buying and consumption behaviors are changing

With the aim of taking a snapshot of current and future consumption patterns and buying behaviors, as well as analyzing the positioning and development opportunities of the different categories and appellations, Nomisma's Wine Monitor observatory conducted a survey of end consumers in Italy.

In the January-September 2023 period, retail wine sales in Italy amounted to 65 billion euros, up in value compared to the same period in 2022 due to inflation, but still in the red in volume although we are beginning to see an easing of the decline. After years of growth, in fact, 2022 had marked a reduction in the volume of wine sold in modern distribution (-5.8 percent), which nevertheless represented a realignment after the significant growth recorded in the pandemic period.

In terms of wine types, Nomisma's analysis shows that in GDO in value terms IGP/DOP and whites perform better (containing the contraction to -3.5% and -3.1% respectively), while in discount stores the best trends concern whites and table wines (-2.9% and -2.3%) and, above all, rosé wines (up +1.8% in volume and +7.8% in value), although the latter play a marginal role in terms of sales size. Sparkling wines, on the other hand, are the only category that is also growing by volume in large-scale retail, although driving sales are generic wines, which are characterized by a significant price differential compared to DOC and DOCG branded bucket charmats (-30%) and are therefore preferred by the Italian consumer because of their greater convenience.

However, the economic downturn impacts not only modern distribution, but all consumer channels. The survey conducted by Nomisma in October 2023 shows that 76 percent of Italians who drank wine in the past year did so at home or with relatives and friends, while only 24 percent did so in clubs and restaurants. For those who used to consume wine at home, in 2023 in 1 in 5 cases they reduced or even stopped consuming wine. Relative to fruition outside the home, however, 21% of respondents said they had reduced consumption while 4% had stopped consuming wine

In addition, compared to today in the next 6 months 3 out of 4 respondents state that wine consumption habits at home and away from home will remain stable and only 5% expect an increase.

As for channels, 24% of Italian consumers declare the intention that they will start buying or do so more often directly from producers (again, the price factor is primarily driving this), as well as 9% will make greater use of online channels, a format to which consumers with greater spending power are mainly turning, also by virtue of an offer that focuses mainly on medium-high-end wines.

These trends, however, do not affect all generations. The under-25s, in fact, approach the world of wine in a completely different way than the generations that preceded them: they drink less, they do it mainly outside the home (in 38 percent of cases) and in different ways (75 percent prefer it mixed).

At the same time, the research conducted by Nomisma notes how the under-25s are consumers who are more attentive to the sustainability of the products they are about to consume, a phenomenon that also affects wine, and pay more attention to health aspects, denoting a strong interest in no and low alcohol wines.

"These trends, first and foremost the attention to sustainability and the interest in wines with lower alcohol content, are destined to strengthen in the coming years," comments Emanuele Di Faustino, Head of Industry, Retail and Services at Nomisma. "In such a scenario, it becomes even more strategic for Italian wine companies - but also for players in the world of large-scale distribution - to have tools that can support them in defining commercial, offering and positioning policies in the best possible way.

To meet these needs Nomisma Wine Monitor offers several market intelligence solutions, including competitive intelligence activities. Precisely with reference to the latter solution, Nomisma has developed the NOMISMA WINE GDO INDEX, an original indicator that makes it possible to identify the positioning of the wine offer of the main Italian modern distribution brands to support both retailers' strategies on the category and the commercial policies of individual companies.