As the names suggest, Barefoot and Cupcake wines are presented as easygoing and carefree, but the highest-volume and fastest-growing brands, respectively, are doing some serious business at a time when inexperienced drinkers are flocking to unpretentious wines.
“The names are kind of kitschy and instead of having to figure out what the item or flavor is, it’s really more about the brand itself,” said Curtis Mann, director of wine and spirits insights for SymphonyIRI Group.
Brand identity is paramount in a category where traditional advertisements are relatively few, and many decisions are made while standing before upwards of 800 SKUs.
Provided they fall within a predetermined price range, occasional imbibers tend to select bottles that have the most interesting labels. This is especially true of the 20- and 30-somethings who’ve spurred much of the 9% jump in wine consumption in the past five years. According to a report citing Wine Market Council research, 60% of those ages 26 to 34 find “fun and contemporary looking” wine labels of great importance when purchasing wine, which is nearly twice the percentage of Baby Boomers.
“Brands like Barefoot, Ménage à Trois, Cupcake and Apothic have a really clear, concise brand idea conveyed on the label,” noted Mann.
The proof is in the sales.
Posting 13% growth in food, drug and mass channels combined during the 52 weeks ending May 13, according to SymphonyIRI, Barefoot — positioned by E.&J. Gallo as a “fun, flavorful and affordable” wine — is the category share leader. Forty brand ambassadors, known as “Barefooters,” emphasize the brand’s laid back image during beach gatherings, nonprofit events and retail demos.
Though on a smaller base, Ménage à Trois, which markets playful blends of threes — including moscato that combines grapes from a trio of growing areas and a California red that blends three distinct varietals — is also posting double-digit growth at 14.3%.
Dave Miller, director of wine and spirits for Minneapolis-based Supervalu, attributes the brand’s success to its packaging.
“Ménage à Trois, Cupcake and Apothic are national brands with fantastic trends right now and it’s all because of the label,” Miller said. “They are a lot more inviting to a younger consumer and not so traditional.”
Nick Long, beer and wine category manager for the Piggly Wiggly Carolina Co., said that Cupcake Vineyards has done “an amazing job” of targeting Millennial consumers and women in particular with sweet wines in relatable flavors like Red Velvet and Angel Food. “Cupcake is a fun brand that’s targeting a younger crowd and consumers who like sweet things,” he said. Sales of the brand have skyrocketed 95.6% vs. a year ago, according to SymphonyIRI.
Supervalu Chills Out
Supervalu has been so impressed with these brands performance that it’s modeled private labels after the Barefoot and Cupcake lines.
Last year, it introduced Chill Out — its answer to Barefoot — to select independents and its Albertsons, Jewel-Osco, Acme, Cub Foods, Shaw’s, Save-A-Lot, Shoppers, Shop ‘n Save, Farm Fresh, Hornbacher’s and Lucky’s banners. Featuring the same varietals as Barefoot — including pinot grigio and moscato — it retails for $5.99 vs. the national brand, which runs about $8.99, according to Miller.
“It’s got a fun feel and a great name right off the bat,” he said of the brand with the beach-themed label. “The price point is very approachable for consumers who are just getting into wine.”
To ensure that the brand would resonate with younger shoppers, test labels were put through a panel study comprising Millennials. “We wanted to see what they liked — the colors, the fonts, the names,” noted Miller. “So far it’s paid off really well.”
Indeed, Chill Out was deemed the No. 1 private-brand launch across Supervalu’s beer, wine and spirits business.
“Our shoppers really love this product and sales are tracking meaningfully ahead of expectations,” said Craig Herkert, Supervalu’s president and chief executive officer, during its first-quarter earnings call. “We estimated that this new line has added an incremental 40% to our sales within the category.”
Supervalu’s Flame Lily, which is modeled after the Cupcake Vineyards brand to appeal to female consumers, is also selling well. “Fifty percent of wine shoppers out there are female and our largest consumer base is female, so Flame Lily is right on point with our female shoppers today,” Miller said.
With its main audience in mind, Supervalu gave Chill Out and Flame Lily wines screw caps to support ease of use and environmental sustainability. The twist-off caps also keep the product fresher longer, thus supporting everyday drinking occasions.
While Miller was hard pressed to find a twist-off cap on wine 20 or so years ago, the closures represent the direction in which much of the industry is headed; today he sees a 50/50 split between cork-finished wine and twist-off caps.
“Millennials are thinking, ‘I don’t have to get out the cork screw and go through all the hassle I saw my parents go through with busting corks. Now I grab the stealth closure, twist it and it comes off. If I choose not to finish it I can seal it back up for the next day,’” Miller said.
Wines aren’t just easier to open, but easier to enjoy as many boast a sweeter, less tannic profile than in the past. The American palate, and especially that of younger consumers who grew up drinking soda and energy drinks, is accustomed to sweeter tastes, according to Mann.
“If you look at trends vs. Australia and the U.K. and other places where they haven’t been drinking as much soda or eating as many sweets, they tend to have a very dry palate. They’re striving for things like dry riesling and dry champagne, but here in the U.S. we like things to have a 1% residual sugar in them or a 1.5% residual sugar,” he said.
This is a change from the dry wines that retailers highlighted 10 or so years ago. While they made for a suitable accompaniment to complementary foods, they weren’t always easy to drink on their own. With sweeter wines there isn’t as much fuss.
“Now when a consumer goes home and tries a product, they’re trying something that doesn’t bite on the palate. It’s easy to enjoy before, during or after a meal,” said Mann.
How Sweet It Is
The success of certain varietals is also indicative of a sweeter wine preference. Take, for instance, the popularity of moscato wine, whose sales have soared 73% over the last year. Because of its sweet taste, Miller refers to the varietal as the Red Bull of adult beverages. And just as Red Bull escorted many a foray into the energy drink category, Moscato is viewed as a gateway beverage.
“Moscato is bringing more new wine buyers into the category than any other varietal. This may be because it has a sweeter, more fruit-forward profile that new or infrequent consumers seem to enjoy,” said Stephanie Gallo, vice president of marketing at E.&J. Gallo, which produces seven brands of moscato including Gallo Family Vineyards, Barefoot and Mirassou.
Although wine consumption grew 4.7% last year, according to the Wine Market Council, with just 38% penetration there is room for growth.
The best way to draw new users to the category and help occasional drinkers branch out is by allowing them to taste new and different beverages for themselves.
The tactic has been very effective at driving incremental sales. In fact, the 118 Supervalu stores where wine sampling is permitted outsell those that do not allow demos, 14 bottles to 1, said Miller. With in-store sampling the retailer was even able to convert female shoppers to drinkers of male-dominated liquors.
As part of a recent campaign it mixed ginger with Jack Daniels Tennessee Honey — a honey liqeur blended with whiskey. “It’s a sweet profile so you’re picking up a lot of female consumers and a lot of Millennial young men that maybe never drank Jack before,” noted Miller.
The same result can be had by sampling red blends, Miller said.
“They might say ‘I don’t know, my mom and dad always drank cabernet and this is a red blend.’ Then they taste it and it’s not so tannony, it doesn’t seem to jam up their mouth, it has a lot more sweeter notes and they pick it up,” he said.