The 2024 US DTC Wine Market w/ Cathy & Chris Huyghe, Enolytics

With a second year of volume declines, 2024 has been challenging for the wine industry. Digging deeper into what trends are shaping the wine industry’s malaise, Cathy and Chris Huyghe, founders of sales analytics software platform Enolytics, have uncovered important insights into the US DTC wine market, including the decline of women and the divide between the affluent and middle class in wine purchasing. Enolytics has also developed a free service for the industry called EnoInsights, which is worth checking out.  Detailed Show Notes: Enolytics launched b/c no one in wine knew what to do with their data Builds sales analytics software for the wine & spirits industry for both DTC and wholesale depletion dataCustomers primarily small (<$1M DTC revenue) & medium-sized, growing in larger wineriesUS, Canada, Australia - primarily US w/ 80% CaliforniaPartnership with WineDirectExchange anonymized data every quarter and analyze it to build reports for the industry~2k wineries in database, ~1k wineries analyzed after removing outliers2024 DTC trendsRevenue flat-ish, volumes down significantlyWomen purchasing less (-4%) - overall (-3%), men (-2%); reverses a recent trend of women buying more wine, not generationally different, impacting white (-5%) and rose (-10%) more than red (-2%)Affluent areas are doing better (flat revenue, lower volume), middle-class & poorer areas are down moreWineries increasing pricing (+5% through Q3 2024), AOV up due to pricingVA is doing reasonably well, CA - particularly Napa and Sonoma, hardest hit - they largely depend on tourism (70% of purchases from people outside CA), Central Coast CA is not down as much (70% of purchasers from CA)Hospitality/visitation declined 7% (# of purchasers) in 2024 (also declined in 2023)Impacts wine club sign-ups, with hospitality the main club sign-up engineWine club growth -3% (# of members) in last 12 months2020 +7%, 2021 +11%, 2023 -1% (20% attrition through Q3, 28% total; 19% sign-ups), 2024 -2% (19% attrition, 17% sign-ups)Club doing best of all major DTC channels - revenue flat, volume downLess expensive wineries getting hit more (less affluent customers)Customizations up - 20% of shipments, higher revenue per shipmentAvg club tenure fallingBest practices - better training of tasting room staff, use data to manage attrition (Enolytics has an algorithm to determine attrition risk; wineries that use it see 20% less attrition than average), use data to target customers to join the wine club (high spenders that are not in the club)Website sales have the most significant room for growth, -42% since 2022, still up from pre-pandemic2020 +250% in online salesTexting, “concierge” services, more targeted telemarketing (highest AOV channel, 6x tasting room; potential to leverage tasting room staff)Average winery emails the entire list, gets lots of unsubscribes, recommends hyper-segmentation, creates messages for 100-200 peopleEvents - same levels as 2022Opportunity to take tasting room on the roadRecommends targeted events with a specific goalGo to places where there’s an existing customer baseCross-channel marketing can be effective, e.g., using DTC data to sell out a restaurant eventWholesale data partner - VIP - includes “can buy” and “lost” accountsRegional wine marketing boards (VA, Paso Robles) engaging Enolytics to do studies on DTC data - currently doing baseline analysis and onboarding more wineries, sending quarterly reports Hosted on Acast. See acast.com/privacy for more information.