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Changing USA consumption driven by trend of premiumisation and change

Market Bulletin | Issue 108
Photo: Adobe Stock
22 May 2018
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More people in the United States of America (USA) are drinking wine and Euromonitor International expects this trend to continue, predicting that the nation’s wine market will grow 1.2 per cent a year to 2022.

Shift from middle- to upper-income households

At the same time, income mobility is seeing the shrinking of the American middle class as people transition to upper-income households, according to the Pew Research Centre.

Figure 1: USA adult population by income tier (millions)

Source: Pew Research Centre

Wine Intelligence estimates that there are 95 million regular wine drinkers in the USA. Figure 2 highlights that there’s an equal distribution of age and gender among USA regular wine drinkers, and the largest single income group (14 per cent) has an average income of US$100,000 to $149,999 per year.

Those aged 45 and over make up 58 per cent of all regular wine drinkers and millennials (those aged from 21 to 34 years) make up 29 per cent of regular wine drinkers, but it is these millennials who are cashed up and prepared to spend between $20 to $24.99 a bottle off premise, more than those in other age brackets.

Interestingly, Wine Intelligence research also shows that around half of regular millennial wine drinkers purchased wine in a super store, such as Target or Walmart and was higher than the average regular wine drinker at 35 per cent. Despite the high usage of the internet to educate and price compare, only 1 in 10 regular drinkers purchased wine through a wine store’s website, a fifth (21 per cent) of those were aged between 25–34 years. Despite this low usage, as mentioned in last week’s Market Bulletin, online alcohol sales in the USA are growing.

Figure 2: Demographics of USA regular wine drinkers in 2017

Source: Wine Intelligence

Younger consumers more open to alternative packaging

Traditional 750 ml bottles continue to be the most widely accepted packaging, but younger consumers are also more open to alternative types of packaging (Wine Intelligence) such as canned wines, bottled labels with augmented reality and premium wine in three litre boxes (Figure 3).

Figure 3: Packaging formats considered by age

Source: Wine Intelligence