Features On the State of Restaurant Wine Sales
Glass Half Empty? On the State of Restaurant Wine Sales in the Recession

October 2009

When times are tight, we see the trappings of luxury drop one by one off of restaurant menus. Whether it’s an extra shaving of white truffle, a forgotten amuse bouche, or the organic, local microgreens that used to dress a fillet of halibut, certain elements of the composed dish will fall prey first to the necessity of belt-tightening. But what happens to the wine list? When diners are forced to guard their wallets and curb their culinary spending, how do they change their wine buying habits? And should the industry follow suit?

The restaurant industry has already experienced enough of this recession to know that diners, when pinched, respond eagerly to prix fixe specials, reduced price tasting menus, and other concessions to the economic climate. It turns out the same is true for wine. The good news for the industry? Wine drinkers will try many things before they stop spending entirely.

We surveyed a cross section of sommeliers, wine directors, food and beverage managers, owners, executive chefs, and other industry professionals to get their perspective on the subject. From nearly 300 industry professionals from across the country, we got the general impression that while wine buying habits are changing among diners, restaurants will be able to maintain strong wine lists. They need only expand the variety of by the glass, half bottle, and New World wines available on their wine lists to accommodate a general, and perhaps temporary, move toward better cost to quality ratio.

By all accounts, wine is a steady industry, sufficiently flexible to bend without breaking in times of economic crisis. And it is, according to our results, more than slightly bending.  An incredible 60% of our respondents said there had been a “marked decrease” in the percentage of diners buying wine, and 75% of all respondents said they were changing their wine lists to accommodate “an apparent decrease” in wine spending.

Graphs: Changing Wine Lists
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The majority of industry professionals are changing their wine lists to suit spending changes. It remains to analyze exactly how diners are changing their spending habits and, consequently, what action industry professionals take to adapt.

Among the respondents who perceived a marked decrease in diners’ wine buying habits, 89% reported diners are not spending as much on one bottle of wine as they did a year ago. “We have seen more by the glass sales,” said one respondent. Another noted that “a year ago the average bottle purchased [in the restaurant] was in the $70 dollar range; now it's in the $40 range.” Diners are still willing to spend on wine; they are simply purchasing at lower price points. And when higher quality wine is desired, diners are simply purchasing in smaller units. These smaller units, e.g. half bottles and glasses, are what give the industry its flexibility in the recession “If anything,” one respondent said, diners are buying “more half bottles,” while another had noticed diners “moving to glasses” over bottles entirely.

Graphs: Diner Spending
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Several industry professionals noted specifically that diners were moving to glasses over bottles of wine, even if the end result was ultimately more costly. “Glass wines have increased in popularity,” wrote one respondent, “despite the fact that ultimately they are consuming more than a bottle at a higher total cost.” Apparently even the illusion of spending less, as long as it’s done gradually, makes it easier for the diner to spend on wine. Savvy restaurants have been capitalizing on this trend by adding a greater number and variety of by-the-glass wines to their wine lists. Because wine lovers are famously fixated on quality, it’s not unlikely that higher end wines by the glass, at a slightly higher price point than typical wines by the glass, will sell where entire high end bottles won’t.

Of the sommelier respondents, half perceived a substantial decrease in wine spending, although the majority of sommeliers reported that it was only a spending decrease between 0 and 25% which, considering the impact of the recession outside of the food and wine industry, is comparatively low.

Graphs: Spending Decrease
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Considering wine is categorically a luxury commodity—and so would be among the first sacrifices in times of economic need—it is perhaps surprising and certainly encouraging to the industry that diners resist relinquishing wine entirely, and in fact only decrease their wine spending by 25%, if that. Ninety percent of the sommeliers we polled said diners had made a discernable move away from higher priced labels, indicating yet again that the recession has impacted diners’ wine buying strategies in terms of a cost-to-value ratio.

Despite the recession, diners are still buying wine. They may spend differently, “but they are buying,” said one respondent, “either a less expensive bottle or just one glass of a more expensive wine.” Of all of our respondents, 61% reported that diners were replacing single higher-priced bottles with two or more lower-priced bottles. The ostensible trend among diners in the recession is demonstrated yet again: not to forego wine at a meal, but to choose it more carefully and with an emphasis on value.

Graphs: Per Bottle Spending
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Rather than abandon wine altogether, “people search [for] the best relationship between quality and price,” noted one respondent. Many diners are looking to New World wine producers for their increasingly impressive but still affordable wines.  “It's not only a move away from higher priced labels,” another noted, “it’s a move towards value wines from newer wine regions: Chile, Argentina, New Zealand, Australia, South Africa, certain areas of Italy and France, even Portugal, which is starting to make good table wines.” The appeal of these regions for both wine professional and diner alike is that “the quality has improved significantly but the prices are still reasonable.” The sommelier can easily guide the wary diner to these younger wine producing regions on the wine list as an alternative to traditional producers.

In this respect especially, the recession offers the wine industry a rare opportunity to educate diners who desire a better knowledge of the impact of their wine-buying dollar. Diners previously accustomed to purchasing more expensive bottles from France, California, and Italy can be introduced to new producers from around the world. And diners who might never have purchased an entire bottle of a more expensive wine can get exposure to it with increased by the glass options. In theory, as soon as the recession retreats and diners regain their spending confidence, sommeliers and food and beverage directors will have an educated clientele of wine drinkers with palates geared toward sophisticated wines, armed with a renewed desire to celebrate—and spend.