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Red Wine Sales Surge: Record Highs on Media Coverage on Health Research

December 06, 2006

Sales of red wines in food, drug and liquor stores surged in the four weeks ending Nov. 18, following extensive media coverage of a study co-authored by researchers from Harvard University and the National Institutes of Health that found resveratrol, a substance found in red wine, extended the life and improved the health of middle-aged, overweight mice.

In early November, virtually every major newspaper in the country had a story on its front page about new studies suggesting consumption of red wine may help people live longer.

"People got the message," said industry analyst Jon Fredrikson of Gomberg, Fredrikson & Associates, the wine industry consulting firm. "Because we don't show up on the radar with any industry advertising, this kind of wonderful publicity-appearing on the front page of the New York Times and in papers around the country-generates attention and is great for wine."

"It certainly appears that the weight of favorable red wine press, on the heels of the Harvard Medical School report, impacted consumer choice within the wine category, leading to a surge of red wine sales much more pronounced than what we have seen historically, said Danny Brager, vice president, client service for ACNielsen's "Beverage Alcohol Team. "When you combine this press with the overall increase of older age groups within the U.S., it's very reasonable to assume that there is a strong linkage between the Red Wine sales trends we see, and credible medical studies related to the subject of health."

The overall surge in red wine sales led to a strong increase in sales for the entire table wine category, which was up 4.3 percent in volume and 8.4 percent in dollars, an increase of almost $50 million in retail sales compared to the same period a year earlier, according to AC Nielsen.

In the four weeks ending November 18, global sales of domestic Cabernet Sauvignon, as measured by ACNielsen, rose 19 percent, while sales of Australian Cabernet were up 18 percent, and domestic Merlot sales, which had been growing in the low-single digits, were up 13 percent. Sales of domestic Syrah were up 23 percent in the four-week period. With demand for domestic Pinot Noir outstripping supply, there was also a surge in sales of imported Pinot Noir. Sales of wines from Washington State rose 28 percent and Spanish wine sales rose 19 percent, while 3-Liter boxed wines rose 32 percent with more than 100,000 cases sold.

Red wines accounted for a record 52.4 percent of table wine dollar sales in food, drug and liquor stores as tracked by the scanner data in the four weeks ending Nov. 18, compared to just less than 50 percent in the immediately preceding 4-week period, and 51 percent in the comparable year-ago timeframe.

Red wine volume sales had been growing at 3.3 percent for the full year ending just prior to the recent favorable press, but the growth rate almost doubled to 8.3 percent for the 4-week period compared to the previous year's sales and more than 11 percent in dollar gains.

An estimated three thousand scientific articles related in one way or another to the health effects of drinking wine have been published since 1991, when 60 Minutes broadcast a segment about the French Paradox, the fact that people in France suffer relatively low incidence of coronary heart disease despite a diet rich in saturated fats. By 1995, science had advanced to the point that the U.S. Dietary Guildeines for health and nutrition not only discussed the negatives of alcohol abuse, but for the first time also referred to cardiovascular benefits associated with moderate wine consumption.

By law, wine and spirits companies are not allowed to talk about the therapeutic effects of consumption of wine to consumers, though the industry has referred to the dietary guidelines in the public policy arena.

Annual sales of wine in the United States have nearly doubled in volume and tripled in value since 1991. They have increased by roughly 125 million cases since the French Paradox broadcast in 1991 to about 300 million cases in 2006.

For more on this developing story, also see today's coverage in the Press Democrat of Santa Rosa.

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