Meet the U.S. Wine Consumer

Who is the Core American Wine Consumer?

 

By Patrick Cavanaugh, Farm News Director

 

Jon Moramarco is managing partner of BW 166 LLC. The name BW 166 LLC is an homage to the family’s roots in the California wine business. Jon’s grandfather Giuseppe Moramarco, the tenth generation of his family to be involved in the wine business, acquired Bonded Winery 166 in downtown Los Angeles during Prohibition. A graduate of UC Davis, Moramarco started out young as vineyard laborer and progressed through both vineyard and winery jobs.

A lot has changed since then, and Moramarco explained current trends in U.S. wine consumption. “A core wine consumer is considered somebody who drinks wine at least twice a week or more. You have a certain segment of the society that actually has adopted wine as part of their daily life: 36% of legal drinking age adults drink 85% of the wine. You do the math; those people are drinking 100 bottles to 110 bottles a year. That’s truly the [consumer] target for most wineries for their marketing.”

Jon Moramarco
Jon Moramarco

Though wine is often associated with a level of mystery and romance, Moramarco shared, “I look at wine a little differently. I look at it as a way to enjoy life with friends. It’s an affordable indulgence but it’s also one of those things. Sitting around with friends and having a glass of wine with dinner, just makes the whole experience a little more enjoyable. The funny thing is, you can have a very good wine during a dinner with somebody you really don’t like, and wine doesn’t taste as good.”

The California wine industry continues to show healthy, steady growth with total volume growing about 4% a year. Varietal wines of good quality and reasonable price have seen quite a bit of growth in the market. Moramarco deciphered wine pricing as it relates to growth, beginning with two price-per-bottle categories, $7 – $12 and $12 – $20.

“Unfortunately,” Moramarco commented, “wines under $7, are a little softer, but it’s because consumers are trading up and drinking better. So the [trend] is that they’re not drinking as much of the less expensive wines, but they’re drinking more of the more expensive wines.”

Brexit Hurts Wine Exports To U.S.

Brexit-Devalued Pound Hurts Wine Exports To U.S.

 

Jon Moramarco, managing partner of Bonded Winery 166 (BW 166 LLC), is a third-generation wine professional at the company that his grandfather, Giuseppe Moramarco, a tenth-generation wine professional émigré from Italy, acquired BW 166 LLC in Los Angeles from the Jesuits during Prohibition.

 

Moramarco explained the effects of Brexit on wine imports to the U.S. “The UK pound has dropped in value versus almost every currency,” he began. “The UK will not want to raise their price in British pounds, so it will probably drive them to become interested in any exports to the UK from the U.S. They will want to have a lower price in U.S. dollars, which will be tough for producers to do in the U.S.”

shutterstock_87596773 wine bottles

Continuing, “Now those [EU] European wine exporters are going to say, ‘Well, I don’t want to sell at that price to the UK. I’m gonna go try and sell more in the U.S.'” noted Moramarco. “So we will see more imports coming into the U.S. from Europe.”

 

“So you kind of have a double whammy for wine,” Moramarco concluded, “because they’ve kind of lost the margin in one of their key markets.” He anticipated “difficulty in exports with people wanting to drop price,” as well as a greater “increase in people wanting to import into the U.S.”