New data released by WSWA’s SipSource reveals that wine and spirits depletions—actual sales from wholesalers to over 450,000 retailers nationwide—declined 6.0% in the 12 months through August 2024. Wine saw a more significant drop of 8%, while spirits fell by 3.9%, signaling potential challenges for the remainder of 2024 and into 2025.
SipSource analysts noted that, despite earlier optimism driven by factors such as destocking and seasonal shipping patterns, broader consumption trends are cause for concern.
Dale Stratton, SipSource analyst and industry veteran, said, “One fewer shipping day in August contributed to the decline, but it doesn’t fully explain the larger systemic issues we’re seeing in both on- and off-premise channels.”
Premiumization Experiencing a Decline
“This report highlights how premiumization, once a major growth driver, is facing pressure in a tightening market,” Stratton added. “The $100+ price tier in spirits within bars and restaurants performed the worst, declining 12.5%, while mid-range tiers, such as $50-$99.99, saw a more moderate decline of 3.9% in on-premise depletions.”
For off-premise—where over 80% of consumer market volume lies—the $100+ tier fell by 8.5%, while the $50-$99.99 tier dropped 4.3%, according to Stratton.
On the wine side, the $8-$10.99 table wine price tier experienced a double-digit drop of 12.7% across combined on- and off-premise channels. “Wine is hurting,” Stratton said, pointing to changing consumption patterns, economic and inflationary pressures, and reduced shelf space as contributing factors.
White Wine a Bright Spot
Danny Brager, another SipSource analyst, highlighted a few bright spots for wine in the otherwise down market. “Prosecco continued to perform well, up a little over 2% in the last 12 months. The $50+ table wine segment also saw an increase of almost 1% over the past six months, with domestic wines in this tier up nearly 3%. This is a promising sign heading into the critical O-N-D period, offering hope that consumers in higher price tiers are still willing and able to spend.”
Looking ahead, Brager warned that the coming months, including the crucial holiday selling season, will present challenges for most wine and spirits categories. This is underscored by declines in points of distribution across most product classes in both on- and off-premise channels, he added, signaling reduced wine and spirits assortment in stores and bar/restaurant lists.
