ZINIO logo
Shanken's Impact Newsletter

Shanken's Impact Newsletter May 1, 2020

Add to favorites

Shanken’s Impact Newsletter, the leading source for exclusive data on the alcoholic beverage industry in the United States and internationally. Every issue features up-to-the-minute data and analysis on trends in the worldwide drinks market.

Read More
United States
M Shanken Communications

in this issue

10 min.
despite headwinds, imported wine players see opportunity

DESPITE THE CHALLENGES FACING THE imported wine market—including tariffs and the outbreak of Covid-19—a number of brands that have built a strong following among U.S. consumers continue to post notable gains. Overall, bottled table wine imports in the U.S. declined slightly to 76.8 million nine-liter cases last year on a 630,000-case decrease, down from 2017’s high of just over 79 million cases, according to Impact Databank. The value of imported table wine to the U.S. slipped 1.7% to about $4.3 billion, roughly on par with 2017 values. The last quarter of 2019, however, saw significant upheaval for most European imports as the U.S. imposed a 25% tariff on wines at less than 14% abv from France, Spain, Germany, and the U.K. amid a longrunning trade dispute. With a vast swath…

9 min.
brown-forman ceo lawson whiting

In the nine months through January, representing the first three quarters of its fiscal year, Brown-Forman posted underlying revenues up 3% to $2.7 billion and operating income down 1% to just over $900 million. Sales were stronger in the U.S.—where volume increased 4.3% to 14.6 million cases in calendar 2019, according to Impact Databank—rising 6% on an underlying basis. Lawson Whiting has led Brown-Forman as president and CEO since the start of last year, and has immediately confronted significant challenges including tariffs on American whiskey in global markets and, most recently, the Covid-19 pandemic. Still, Whiting sees long-term strength in the Brown-Forman portfolio, anchored by the Jack Daniel’s brand, which sells 13.3 million cases globally and has increased by more than 1 million cases over the past five years. In the…

1 min.
repositioning for growth

WITH DRINKS MARKETERS FACING A NUMBER OF unprecedented challenges from Covid-19 to tariffs, the beverage alcohol industry’s collective mettle is being put to the test. But if early indications hold true, the business could emerge on the other side of these trials stronger than ever. To take just one example, wine importers specializing in upscale bottlings have seen the on-premise market—their bread-and-butter—disappear virtually overnight amid the pandemic. While the on-premise will re-emerge eventually, in the meantime import players have displayed remarkable agility in shifting resources to the off-premise, where retailers are eagerly buying up wines that were previously unavailable to them. Similarly, wineries and distilleries that are heavily reliant on visitors and tasting room sales have been scrambling to come up with new revenue streams and ways of connecting with consumers—and they…

1 min.
ca wineries target affordable luxury

CALIFORNIA WINEMAKERS HAVE BEEN making strides in the affordable luxury segment retailing at the $15-and-above tier, an area that appears ripe for further progress even amid the difficult conditions. Last year, U.S. volumes of California wine retailing at $15 and over a 750-ml. bottle hit 11.13 million cases, up from just 7.1 million cases in 2014, according to Impact Databank. Among the brands bringing attention to the Central Coast is Josh Cellars, which launched a higher-end Reserve tier in 2017. “The Reserve lineup has been extremely successful, in part because it offers our core consumers the opportunity to trade up and explore California in-depth,” says Tom Steffanci, president at brand owner Deutsch Family Wine & Spirits. Overall, Josh Cellars has more than doubled in size to nearly 3.2 million cases…

1 min.
wine spectator donates $250k to wck

THE WINE SPECTATOR SCHOLARSHIP FOUNDATION HAS ANNOUNCED A CONtribution of $250,000 to World Central Kitchen (WCK), the charitable organization led by chef Jose Andres. “Jose Andres is world famous for his enormous charity efforts devoted to feeding people in need,” said Marvin R. Shanken, editor and publisher of Wine Spectator. “This donation is intended to help feed many of the Americans who have lost jobs due to Covid-19, including restaurant workers, as well as front-line health care workers and other vulnerable groups.” WCK was founded in 2010 and has served more than 16 million meals globally. With a #ChefsForAmerica effort addressing the fallout from Covid-19, the charity has served nearly 1.5 million meals across the country. #ChefsForAmerica is active in more than 85 cities including Little Rock, Los Angeles, Miami,…

1 min.
diageo offers update amid covid-19 crisis

THE WORLD’S LARGEST SPIRITS MARketer has warned that it’s seeing “a significant impact” on its performance due to widespread containment measures implemented in March. With the crisis disrupting on-trade markets around the world, Diageo withdrew its guidance for its fiscal year ending in June, saying it’s “not in a position to accurately assess the impact of this on our future financial performance.” In late February, the company said it was expecting negative impacts on net sales and operating profit in its fiscal year ending in June to be in the range of £225 million-£325 million ($291m-$420m) and £140 million-£ 200 million ($181m-$259m), respectively. Across its business, Diageo says it’s tracking changes in consumer behavior due to the on-trade closures, including in the U.S., where the on-premise accounts for about 20% of its…