Market Watch: Canned Wines Still Seeing Double-Digit Growth

August 19, 2020

Canned wines are accelerating and navigating their way through the rough-and-tumble landscape of the global pandemic. A taste for rosés and sparklers is fueling the category’s growth, as is the need for alternative packaging and convenience—plus the popularity of outdoor activities. “Dollar and volume sales of canned wines are surging in the mid-double digits, and volumes currently outpace dollar growth,” says Olivier Kielwasser, category lead for wine at BevMo, which has nearly 170 stores in California, Washington, and Arizona. “The increase in sales is driven by both new items hitting the market and the strength of existing brands.”

Led by sparklers, Pinot Grigio, rosé, and red blends, the category is even stronger at Wyatt’s Wet Goods in Longmont, Colorado, where growth has more than doubled since last year and total cans sales are up 116% so far in 2020. “Sales seem to be skewed toward the 21-45 year olds, who do a lot of hiking, camping, biking, and socially distant outdoor dinners with friends,” says owner Dennis Dinsmore.

Customers are gravitating toward canned wine brands like Underwood, House, and Dark Horse thanks to their convenience and portability.

Convenience Factors

Retailers note canned wine is a viable option when glass is impractical, such as at swimming pools, golf courses, and on boats. Moreover, a 375-ml. canned wine equals half of a standard bottle and is a convenient alternative package size. “Some consumers appreciate the ability to have a single can of wine instead of having to open a full bottle,” Kielwasser says. “This is amplified with bars currently closed, as those who would otherwise be having a glass of wine at a bar after work find small-format canned wines a convenient alternative.”

BevMo carries 50 canned wine SKUs across 17 brands, compared to 30 SKUs and 15 brands last year. “While the brand count has remained rather stable, we’ve line-extended and shuffled brands around, discontinuing many underperforming items and bringing in a lot more new items,” Kielwasser says. “We’ve prioritized sparkling wines, white wines, and rosés.”

Led by House ($5 a 375-ml. can) and Underwood ($6), sales of single cans are driving segment growth at BevMo, while popular multi-packs–including Coppola Sofia ($18 a 4-pack of 187-ml. cans) and Babe ($13 a 4-pack of 250-ml. cans)—are trending slightly downward. “Multi-packs are slightly down year-over-year as a result of cannibalization from new market entries, while increased promotional activity has seen single cans from House and Underwood double versus a year ago,” Kielwasser says.

Space To Explode

At Wyatt’s, just three brands—Underwood ($6 a 375-ml can), Dark Horse ($5), and House ($6)—account for 86% of canned wine sales volume. Single can sales account for 93% of segment sales as customers crave variety, Dinsmore says. Among new canned wine brands, The OBC Wine Project from Fort Collins, Colorado-based Odell’s Brewing is off to a fast start with its Red Blend, White Pinot Gris Blend, Rosé, and Rosé With Bubbles (all $8 a 375-ml. can). “The brand is doing great for an out-of-the-box startup with local appeal,” Dinsmore says.

While canned wine sales have still grown strongly during the pandemic, the situation may have slowed segment growth. “The growth could have been better if the pandemic didn’t close a lot of beaches and parks that have a ‘no glass’ rule,” Dinsmore notes. “People also missed going to outdoor concerts and events. That seems to have pushed some of the growth toward bulk and box products for at-home use instead. I expect the segment post-pandemic next year to explode, hopefully up at least 150% over this year.”

Canned wines are an emerging segment with immense potential as they approach 1% of wine category sales in the U.S. “Canned wines represent an effort by an industry that traditionally resists change to reinvent itself,” Kielwasser says. “When designing items, it will be important for producers to zoom into the trends and understand the consumer needs that drive demand.”

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