Australian wine on-premise: what’s changing (and what to do about it)

Introduction 

Recent data suggests that wine’s traditional role in the Australian on-premise channel is in decline. While interest in wine hasn’t disappeared, changing tastes, rising expectations and operational challenges are changing the way Australians engage with wine in bars, pubs and restaurants.  

In response, Wine Australia commissioned research with Square Holes to better understand the evolving role of wine in the on-premise channel.  

The study explores how consumers interact with wine on-premise through consumption behaviours, on-premise motivations, consumption barriers, decision drivers and attribute preferences across demographics, sub-channels and occasions – and how Australian wine producers can respond, to remain relevant and competitive in a changing cultural and commercial landscape.  

This market bulletin provides a summary of the report’s key insights and recommendations. 

Key insights: what’s changing in on-premise wine consumption 

Wine is losing ground to more dynamic, customisable beverages 

Cocktails, mixed drinks and other beverages that offer greater visual appeal, personalisation and perceived value are on the rise in on-premise dining. Consumers are becoming more discerning, prioritising overall value and experience rather than price alone. Wine still resonates where it is thoughtfully curated, visually engaging and aligned with evolving consumer tastes. 

Younger consumers aren’t rejecting wine, they’re just in different settings 

Age significantly shapes wine engagement, with the connection to wine growing with age. Millennials and older consumers associate wine with meals and curated settings, while younger drinkers opt for faster, simpler options such as spirits, cocktails or RTDs in the loud or busy environments they frequent. Wine is more likely chosen when it feels intentionally integrated into the overall venue experience. 

Complexity, not cost alone, is turning people away 

Perceived cost, complexity, and limited variety are leading deterrents for wine consumption. Consumers perceive wine as more expensive than other drinks, difficult to navigate due to unfamiliar or overwhelming wine lists and lacking sufficient by-the-glass or preferred style options. The fear of making the wrong decision (particularly with cost-of-living increases) makes selecting a wine a higher risk proposition. 

Execution gaps are costing the category 

The main barrier is execution, not lack of interest. Consumers still want wine, but staff discomfort, complex menus and poor presentation create friction. Most on-premise consumers make spontaneous purchase decisions, however, will stick to drinks they know they’ll enjoy, driven by a strong desire to avoid wasting money. This cautious behaviour is consistent across age groups and reflects a broader focus on value, health and mindful consumption. 

Key recommendations: how to respond to these changing dynamics 

Simplify wine experiences and improve staff confidence to overcome capability gaps 

Simplifying how wine is described makes wine more approachable, particularly for consumers unfamiliar with varietals or wine regions.  

• Increase the focus on taste profiles and food pairings and lessen the reliance on regions or varietals. Other categories like beer and cocktails succeed by offering simplicity, fun, and clear, relatable descriptors. This will help make wine feel more approachable to younger consumers in the absence of trusted or knowledgeable influencers. 
• Frontline staff are key to improving wine sales and wine underperforms without staff support. Wineries can work with venues to train staff to make wine simple and inviting, equipping them with the tools to confidently recommend wines in plain, relatable terms and connect them to menu items. 

Innovate wine formats and activate point of sale  

Modern drinking occasions, including casual and diverse contexts, call for modern formats. Alternative formats are more suited to higher tempo venues and improve ease of service and, potentially, profitability. They also offer the consumer convenience and better suit lower-commitment occasions. 

• Consider introducing or increasing non-traditional formats like cans, 200ml bottles and wine-on-tap to help wine feel more relaxed and group friendly.  
• By-the-glass options can assist exploration to help lower the barrier to trial, making wine feel less risky, particularly for consumers who are still discovering their preferences.  

Boost consumer motivation through value-driven, taste and storytelling-led approaches

Modern consumers want more than just a product – they’re seeking meaning, connection and authenticity. While wine is rich in heritage, it often struggles to engage younger audiences who prioritise relatability and lifestyle over tradition. Spirits brands have been more successful in this space, leveraging culture, storytelling and digital engagement to stay top of mind. 

• Use compelling stories behind the wine – about the winemaker, the region, or sustainability – to connect with consumers through place and story.  
• Communicate in the formats that resonate with today’s drinkers, going beyond technical language and embracing visual content, social platforms and immersive in-venue experiences that bring wine to life. 

Reposition wine as a flexible choice for all occasions  

To attract younger consumers, wine needs to feel more casual, social and relevant to everyday venues and occasions. The opportunity lies in going beyond the traditional offerings to position wine as something easy and enjoyable, not just for formal meals.  This doesn’t mean compromising on quality. Instead, it’s about presenting wines in formats and styles that resonate with a new generation.  

• Shift focus from traditional wine rituals to more modern, accessible serving and consumption experiences that better reflect how today’s consumers engage with alcohol.  
• Make wine more accessible and relevant by integrating it into a wider range of drinking occasions, beyond specific special occasions and celebrations, especially in casual and suburban venues.  
• Focus on offerings that encourage trial and reflect current preferences, such as lighter options or alternative formats.  
• Position wine as a natural choice for everyday social settings, helping the category stay competitive and better aligned with current preferences in a changing drinks landscape. 

Tailor strategies by winery size and venue type 

Venues today expect wine options tailored to their operational realities - whether that means private labels, smaller formats, or wine-on-tap systems. Standard retail offerings often don’t suit the margin structures, service speed, or flexibility required in the on-premise environment. 

For wine to succeed on-premise, it must be as simple to serve and sell as its competitors, such as beer and spirits. When wineries and distributors co-create flexible, fit-for purpose solutions, they consistently see stronger engagement from the trade.  

• Work collaboratively with distributors and venue partners to develop fit for purpose wine options that improve relevance, ease of service and trade engagement. 
• Move away from legacy SKUs where appropriate and introduce  venue-specific or commercially driven offerings. 

Adapt strategies by winery size and venue type: 

• Smaller wineries are likely to be under the most pressure in the on-premise and may have challenges offering attractive economies of scale commercial terms to venue groups. They might consider targeting independent or suburban venues, building personal connections, offering exclusive formats or support, and using storytelling and in-person engagement. 
• Medium-sized wineries generally work closely with distributors and may leverage training and other programs. Their priorities to consider include tailoring offers by venue type and channel, developing a deeper understanding of venue and customer needs, aligning messaging to consumer demand, and new product innovation. 
• Larger wineries have more resources to support and develop their sales teams and are generally highly proactive in working with on-premise venue groups and key segments, including undertaking their own data analytics, research and innovation programs. However, they could look to better leverage scale with relevant offerings and support venues with training, clarity and commercially viable offerings. 

Summary 

Collectively these insights and recommendations aim to help wine stay relevant in a changing Australian on-premise market, by aligning the category with evolving consumer expectations, experiences and values.  

Improving wine’s performance in the on-premise lies at the intersection of wine brands, distributors, on-premise venues and customers; a collaborative effort to create wine experiences that are easy, enjoyable and commercially sound. Wine thrives when it delivers value to the customer, commercial return for the venue, and long-term brand equity for producers. 

Customers will pay for wine when it feels worth it. That means affordable options or elevated experiences. Simplicity, flexibility and staff support are key to unlocking trial and loyalty, as are a solid wine selection (value to premium, by the glass and bottles), menus and otherwise. These aspects can help ensure the experience lives up to the cost.