The wine trade is in trouble. With a combination of declining consumption, rotting fruit left on the vine, public health warnings, tariffs and the overarching crisis of climate change, most people would agree that wine faces challenges.
The bigger question is how the wine industry should respond. What, if anything, should it do differently? Or should it wait things out, and hope this is a cyclical change?
I’ve been covering wine for more than 20 years, and never before have the challenges seemed so great. For better or worse, this is how I would assess what’s going on in wine, and some steps the industry could take to adapt.
The State of the Industry
A Fractured Consumer Base
It’s impossible to talk about wine consumers as if they all have the same interests and goals. I divide most wine consumers into two very different groups.
On one extreme is the largest body of wine buyers. They are not interested in how it’s produced, where it comes from, vintages or aesthetics. They mostly want an inexpensive alcohol delivery system that tastes good. They enjoy wine but are not wed to it. They might replace it with hard seltzer, premixed cocktails or cannabis if that were cheaper and just as enjoyable.
On the other extreme is a smaller group, people who love wine and care deeply about all the geeky pleasures it offers. Like everybody else, they are sensitive to economic fluctuations. They may adjust their spending, but they continue to buy wine regularly and spend more per bottle than less-committed consumers.
In between are many different shades of wine buyer. But generally, people either care about wine or see it as a means to an end.
A Dichotomy of Production
Wine producers globally comprise diversified multinational corporations, big companies and many, many small family businesses, far more so than with any other alcoholic beverage. Each of these groups has different interests and problems.
Big corporations and companies can produce some great wines — the LVMH Group, for example, owns Cheval Blanc and Dom Pérignon. But they also are the most diversified, best financed and least vulnerable to fluctuations in the economy and public perception.
Small family businesses, the backbone of the global wine economy, are the most vulnerable and least flexible. They are often both the keepers of traditions and the instigators of innovation, and are largely responsible for the diversity that makes this such a great time to explore wine.
Natural wine, which over the last 25 years has changed how we think about wine more than anything else, was an insurgency of many small businesses. These vignerons insisted that wine is an agricultural product grown by humans, not an industrial commodity produced efficiently in factories. These are the wines that have gained popularity over the last 20 years.
As with any food, wine can be produced cheaply on a mass level. But those who care about wine and food seek out the good stuff and are willing to spend a little more for it.
An Economic Downturn
Sales of the cheapest wines have declined the most, far more so than pricier bottles. This is happening more or less everywhere. People are drinking less, but drinking better, a trend that has continued for decades.
One reason for this is health concerns. Without question, drinking too much is dangerous. Moderate drinking is another matter, and the truth is hard to get at. I hope people can make informed decisions. For me, wine in moderation enhances my life. I believe wine has its place along a healthy diet, sufficient sleep, exercise and the rest.
More expensive wines seem to have largely held their own. You cannot judge quality by price, but you can assume that wine is more important to people who are willing to spend more on it.
Good wine is not necessarily expensive. But to farm grapes conscientiously costs more money than the factory-farmed grapes and cut-rate bulk wine that forms the basis for the cheapest supermarket brands. These commodities, with little cultural content, are faring the worst.
But wines with meaning — those that come from a place, from people who are either upholding traditions or starting new ones — are not immune to a downturn. I believe these wines will always have an audience, but they are far more susceptible to environmental and economic pressures than the commodity brands. These are the wines that I care most about. When wildfires, hailstorms and spring frosts occur, calamities that are often the direct result of climate change, these producers are threatened. They don’t have the resources to survive continued crises. When you layer on the effects of tariffs and health warnings, the threat becomes more acute.
How Can the Industry Adapt?
Slogans like “Got Milk” or “Where’s the Beef,” financed by big corporate interests, will not work for wine. The fragmented nature of wine, with its myriad small businesses and different interests, makes it difficult to act in unison or finance such actions, and rules limit how alcoholic beverages can be promoted.
But there are a few steps the industry can take to ensure its viability for decades to come.
Simplify Its Offerings
The United States grows more grapes and makes more wine than people want to buy. Consumption, after rising for decades, has declined annually since 2018, except for a pandemic blip in 2020 and ’21.
As a result, wine needs to suffer through the pain of consolidation. It’s been happening in Europe for years, as historic vineyard areas that once supplied cheap daily wines find their market has disappeared.
This is bad news for all growers and producers, but especially for companies that measure success solely in terms of growth. Publicly traded companies have sold off brands or even declared bankruptcy.
For smaller growers and producers whose goals are primarily artisanal, the outlook is perhaps not so bleak. The customers for these producers may be drinking less, but they are still largely committed to wine.
This group may have to reduce its production slightly. But it should double-down on conscientious farming and making good, unpretentious wines. These are the brands and the wines that will endure.
Lower the Price
The greater wine world, by which I mean producers, distributors, restaurants and retailers, needs to cut the cost of wine. Younger people are not buying wine at the same rate as older generations, and one significant reason is prices are too high, particularly with American wine.
Sadly, winemaking costs more in California, for example, than in Europe. Tariffs may be intended to level the playing field, but they will make everything more expensive. Except for those working in high-paying fields, few younger people are willing to spend more than $20 for a glass of wine in a restaurant or $50 to $100 a bottle in a wine shop.
Growers and producers must find creative ways to keep costs down while continuing to attentively farm and make wine. In California, for example, producers like Broc Cellars, Matthiasson, Hobo Wine Company and Monte Rio have all introduced lower-priced wines that maintained the high standards already set by these producers. We need wines that are alive and exciting that retail for $20 to $30 and sell in restaurants for $10 to $15 a glass and $40 to $50 a bottle.
Restaurants and retailers must do their part by not jacking up prices. Catering only to wealthy people may build short-term profits but it will kill the industry. Making it more affordable to younger people will help to assure a continued audience.
Lose the Snobbery
Wine must be made more inviting. What makes it forbidding and intimidating? Not the delicious beverage itself. No, it’s the belief that one must learn about wine before enjoying it. No single practice has killed more American wine bars than their insistence on trying to educate people who merely want wine to have a good time.
Nobody explains how an electric guitar works before a concert. Let those who want to be educated come to you. The best wine bars, like Frog in Brooklyn and Easy Does it in Chicago, are always ready with information, if asked, but never inflict it unsolicited. They are filled with the audience of young people wine is trying to attract.
What sells wine is the emotional connection that people develop with it. Wine should symbolize joy, pleasure, reward, togetherness and deliciousness. This is the attraction, not how intricately you can describe a flavor. Intellectual rigor can come later for those who are interested. But to sell wine, emphasize its pleasures.
No one step will magically solve wine’s issues. But if the industry can concentrate on what wine does best without pretense — the way it provides emotional and intellectual pleasures, accompanies meals and enhances social occasions — it will help to solidify its place on the table for years to come.
Follow New York Times Cooking on Instagram, Facebook, YouTube, TikTok and Pinterest. Get regular updates from New York Times Cooking, with recipe suggestions, cooking tips and shopping advice.
Eric Asimov, the chief wine critic of The Times since 2004, has been writing about wine, food and restaurants for more than 30 years.
The post What Can Be Done to Save the Ailing Wine Industry? Our Critic Has Thoughts. appeared first on New York Times.
