Here's How

Retailers and vendors decant tips to sweeten already rosy wine sales.

Central Market's goblet runneth over.

"We have noticed consumers spending more per bottle, being more adventurous and open-minded to trying new recommendations from our store experts," says Chris Potestio, business development manager for wine, beer and cooking schools for the gourmet banner of San Antonio-based H-E-B. "We have seen consumers who love domestic reds realizing the great values in import categories like France, Italy and Argentina."

To keep the momentum going in its wine departments, Central Market has joined forces with St. Helena, Calif.-based Kuleto Estates, buying most of the production of its premium Napa Cabernet, which retails for $49.95, and is also offering an exclusive new Pinot Noir for $17.95 from the Santa Rita Hills winery in Santa Barbara, Calif.

Recent promotions include a two-week initiative with the aim of educating shoppers about French wines, and when it comes to merchandising, Central Market has taken pains "to ensure our displays and end caps are easily shoppable and approachable for the average consumer," asserts Potestio. "This means each display and end cap must be neatly organized, and we have merchandising guidelines for the stores to follow, along with the appropriate signage to go along with each."

All of these strategies have paid off where it counts: at the cash register. Wine sales at the nine-store Lone Star chain "were strong last year and on pace with our overall company performance," says Potestio. "We faced many new competitors last year entering the Texas market and were well prepared from an assortment, promotion, pricing and service perspective."

Pairing Up

Wine suppliers are similarly optimistic about the category, particularly in supermarkets. "The grocery channel has historically been a good channel for us, and continues to be so," says Don Sebastiani Jr., president and CEO of Sonoma, Calif.-based Don Sebastiani & Sons. "Our creative packaging, compelling in-store promotions and accessible pricing on our broad-based wines resonate with our customers."

The company's latest releases include Steelbird, a popular Smoking Loon unoaked Chardonnay retailing for $8.99 per 750-milliliter bottle, and a Tempranillo-based red blend, The Crusher Sugar Beet Ranch, retailing for $12.99 per 750-milliliter bottle.

One key to the company's success is to take full advantage of the fact that wine pairs with food. "For our broad-market brands like Smoking Loon, we are increasingly doing thematic promotions that pull in other mainstream grocery brands," observes Sebastiani. "For our spring 'Toss It Up' program" — selected nationally by Kroger — "we are partnering with Colavita Olive Oil and Balsamic Vinegar, and Mrs. Cubbison's salad toppings to target displays in the produce aisle, an area often overlooked by other wine producers. ... This fall, we will be partnering with the National Pork Board, Jarlsberg Cheese and Inglehoffer Mustard in our second annual Smoking Loon 'Smokin' 'Sammie' promotion, which is built around creating the ultimate sandwich using the partner ingredients paired with specific varietals."

Further, "in addition to the typical promotional windows like holiday, we have made a conscious effort to target occasions where there is less noise from the big corporate players," explains Sebastiani. "We have carved out a nice niche for ourselves with our annual 'Time With Dad' Father's Day promotion. The theme this past year was 'Fishing with Dad,' and we targeted the seafood aisle with some pretty creative displays designed to look like crab crates. The stores loved them, and we had a nice uptick in white wine sales during that window."

Another atypical tie-in was the company's inaugural Groundhog Day promotion encouraging folks to stock up on either more reds for winter or whites for spring, depending on whether Punxsutawney Phil saw his shadow (he didn't, presaging an early spring).

Quality Counts

"Consumers are buying more wine in the $10-plus segments — even $20-plus — at supermarkets," says James Nunes, VP, marketing services & strategy at St. Helena-based Trinchero Family Estates (TFE), echoing the earlier observations of Central Market's Potestio. "As the economy slowly improves, consumers are more willing to sacrifice cost for quality, especially when it comes to 'affordable luxuries' like wine." Nunes further points out that wine is increasingly an everyday beverage, and that shoppers are opting more often for alternative packaging such as boxed wine, citing the Target Wine Cube, which is celebrating its 10^th anniversary this year with silver boxes in limited quantities.

"Supermarkets are responding to these trends by expanding wine sections in addition to including and promoting more premium and luxury wine," he notes, adding that "the TFE portfolio has been performing well in supermarkets, keeping pace with category growth despite distribution gains in other channels."

TFE has lately launched several new products, including, last month, a new brand, Echo Bay, a New Zealand Sauvignon Blanc described by Nunes as "a varietal that continues to grow and [that] consumers demand." The company has additionally introduced new offerings to its Sutter Home Folie a Deux, Ménage a Trois and Bandit lines, the last of which comes in an eco-friendly, conveniently sized Tetra Pak, and has added Charles & Charles wines to its collection.

At press time, TFE was preparing to launch its "Build a Better Burger" promotion, which Nunes calls "one of the most successful wine promotions in the industry." The annual consumer recipe contest invites 10 finalists to the Napa Valley to prepare their best burger recipes for a shot at winning up to $100,000. In-store point-of-sale materials include large mass displays with a grilling theme, backcards, casewraps, recipe booklets and cross-merchandising coupon offers. This year's partners are King's Hawaiian Bakery, Wholly Guacamole, the Beef Checkoff, the California Milk Advisory Board, Weber Stephenson Inc. and Kettle Brand Chips.

TFE's merchandising "varies, depending on the brand," notes Nunes. "The goal is to get the consumer's attention. Small-footprint wood or wire racks that showcase a wine, and can be executed anywhere in the store, are one good way. We also focus on displays that play on seasonality and merchandise them with consumer recipe guides or entertaining and wine-pairing booklets. With our seasonally themed displays, we tie in with top food brands to offer consumer savings on multiple products, which gives stores a reason to create mass co-branded displays."

Such methods enable a company "to get [its] wine out of the wine aisle and into the perimeter areas such as near meat bunkers, in the produce deli area and in front of the checkstand, capturing consumer attention," he adds. "Consumers are more likely to pull wine off a display near the meat case or cheese deli when recipes and wine pairing make it easy for them to decide on their meal choice and wine to pair it with."

How Sweet It Is

The outlook for wine in the near future is, in a word, sweet, thanks to the success of "so-called 'gateway' wines like Moscato and sweet red blends," according to Sebastiani, while TFE's Nunes predicts "we will continue to see the growth of red blends, as sweeter wine styles continue to resonate with consumers," along with greater interest in unoaked and "low-alcohol/skinny" wines.

Nunes and Tom Steffanci, president of White Plains, N.Y.-based Deutsch Family Wine & Spirits, whose Australian Yellow Tail line is the No. 1 wine brand imported to the United States, both think that sparkling wines like Prosecco will take off in popularity, particularly among "new wine consumers and millennials whose palates are accustomed to sodas, juices and lighter-style beers," as Nunes puts it. Steffanci also forecasts that Sangría, which has been around for a long time in inexpensive forms, will morph into a more premium, high-quality product, transitioning "from cheap jugs to chic 750-milliliter bottles."

"We faced many new competitors last year entering the Texas market and were well prepared from an assortment, promotion, pricing and service perspective."

—Chris Potestio, Central Market

"Consumers are more likely to pull wine off a display near the meat case or cheese deli when recipes and wine pairing make it easy for them to decide on their meal choice and wine to pair it with."

—James Nunes, Trinchero Family Estates