October's data insights focus on results for both wine and spirits in the on-premise, highlighting where growth is taking place for each of the segments. Overall, while data shows a gain of +3.6% for spirits on-premise, it’s the third consecutive month of slowing growth for the sector. Wine, on the other hand, declined -2.9% in the on-premise, which also has seen slow growth for the past three months. The last uptick in wine on-premise occurred in July, which is also the last time the segment posted a result in the black. While the results haven’t been stellar, there are pockets of growth in each that we will highlight below.
Of the eleven main product classes tracked in SipSource, positive results were posted by six. The classes that gained in October were Cocktails (+38.6%), Tequila (+5.2%), Gin (+3.9%), Cordials & Liqueurs (+3.6%), Whiskey – US (+1.4%) and Vodka (+0.4%). Diving a bit deeper Cocktails, Tequila and Gin all were up across all seven on-premise channels in the database, while Cordials/Liqueurs and US-Whiskey gained in six channels. SipSource tracks outcomes in seven census divisions and Cocktails, Gin and Cordial/Liqueurs posted results in the black nationwide in October. Meanwhile, Tequila fared well in every division aside from the Pacific division (-0.2%) where it declined slightly. Looking at the pricing spectrum, Cocktails and Tequila both posted their largest gains at the lower end while both Gin and Cordials saw their biggest gains in the fifth and sixth price tiers, respectively. Finally, looking at chain types (Independent, Small, and National) every class gained in every one of those channels aside from Vodka that only grew in small chains.
The results across wine classes weren’t as favorable as spirits with only Cocktails – Wine (+4.1%) posting a result in the black in October. It’s important to note that this segment of the market only accounts for 2.1% of total on-premise wine volume. That said, this class of wine grew in five of the seven channels and census divisions within SipSource and also had the most pronounced upticks among the two highest price tiers. It is noteworthy that this segment is dominated by the below $5.00 price tier - accounting for 93.9% of volume - and gained +3.7%, slightly lagging behind the overall category. Looking at the three Table Wine types, White declined -1.2% while Red and Pink dropped -4.2% and -10.2%, respectively. Within the White wine segment Pinot Grigio (+0.2%) and Sauvignon Blanc (+2.7%) were the only two varietals to post advances. The Sparkling/Champagne segment declined -2.2%, dragged down by Champagne (-13.5%) while Prosecco and Cava both increased +2.6% in our latest reporting. Both Table Wine – White and Champagne saw their only gains in the Northeast and East North Central divisions.
While we continue to see the industry growth slow across premise and channel there are product classes, channels and census divisions that continue to post positive results in both wine and spirits. As we finish out 2023 it will be interesting to see if the holiday season buoys results among pockets of the market not highlighted this month.