Wine is a category on the move, and wellness is playing a big part. According to the Organic Trade Association, sales of organic wine hit $80 million in 2005, and are expected to grow at 17% a year through next year. Red wine in particular has ridden a strong wave of positive health news since the late 1980s, when moderate consumption was found to reduce inflammation, cholesterol and heart disease. Organic varieties further build on that reputation.
“Organic wines are always a steady category,” said David Schmerr, beer and wine director for Jungle Jim's International Market, Fairfield, Ohio, which carries 30 SKUs of organic wine. “I haven't seen a big increase, but I have seen more people in the past year or so asking for those wines specifically.”
Supermarkets last year upscaled their offerings and increased their overall wine selection by almost 10%, according to the Nielsen Co. This made supermarkets the leader in sales and volume growth among all channels.
“Groceries like Safeway have really made it a point to make wine a differentiating piece of their store,” said Brian Lechner, wine analyst at Nielsen.
Safeway and others have many reasons to raise their glasses, but they need to stay focused. Margins in wine are phenomenal, and competition is fierce. For retailers, the category is particularly important since it's one of the few that allows them to show off their sophisticated side.