- There's a shortage of wine.
Germany, known for its vineyards and wine, is witnessing a shift in consumer habits. It's all about money, and the industry is responding. The demand for wine in Germany is on the decline, with consumers showing increased price sensitivity. This trend, according to the German Wine Institute (DWI), is driven by the growing cost awareness within the population. DWI Managing Director Monika Reule mentioned that last year, 4% fewer households bought wine, paying close attention to prices. As a result, the average prices for both German and imported wines saw a slight drop for the first time since 2010.
In 2021, the quantity of wine purchased decreased by 4%, and the turnover achieved by 5%, as reported by Reule, based on NielsenIQ's market analysis. German wines were particularly impacted, with a 5% decrease in sales and a 6% decrease in turnover.
Domestic wines struggle for market share
According to DWI, Germany's domestic wines accounted for 41% of sales and 45% of turnover in 2021, exhibiting a 1% decrease in both metrics compared to the previous year. The top three countries by market share in terms of quantity were Italy (18%), Spain (14%), and France (11%).
The DWI, a communication and marketing organization for the German wine industry, works tirelessly to promote the quality and sales of wines across Germany's 13 wine regions.
(-4%) Less households bought wine, paying great attention to the price.(-5%) Turnover decreased after a market analysis by market researcher NielsenIQ.(-5%) A 5% decrease in sales and a 6% decrease in turnover for German wines.(-1%) Market share of domestic wines decreased by one percentage point in 2021.(-18%), (-14%), (-11%) Quantity market share for Italy, Spain, and France respectively.
The decrease in wine demand can be attributed to multiple factors, such as changing consumer preferences and health concerns. Younger generations are leaning towards healthier drinking habits and non-alcoholic beverages, which has led to a significant reduction in wine consumption across Europe. Additionally, the market is facing competition from other beverages like beer and non-alcoholic drinks, as shown by the growth in the non-alcoholic beer sector in Germany.
Despite this, German wines have managed to maintain their market share, accounting for about 45% of the domestic market, indicating a strong preference for local wines. Italy and France remain the leading importers of wine to Germany, with market shares of 16% and 12% respectively. The value of Italian imports was approximately €925 million, while French imports were valued at €732 million.
The price of wine in Germany has experienced fluctuations over the years but saw a decrease of eight cents per liter due to a larger wine supply following high-yield harvests. The economic context and consumer behavior changes have influenced the pricing strategy of German wines, leading to a trend towards more value-driven purchases across the beverage market.
However, the broader trend of declining wine consumption and shifting consumer preferences towards non-alcoholic options may continue to challenge the German wine industry in the future. It is essential for the industry to adapt and innovate to better meet the evolving needs and preferences of their consumers. Even with the occasional dip in demand, German wine will continue to pour out its charm and rich flavors, capturing the hearts of wine enthusiasts throughout Germany and beyond.
The average prices for both German and imported wines saw a slight drop for the first time since 2010, due to increased price sensitivity among consumers. Last year, 4% fewer households bought wine, paying close attention to prices, as mentioned by DWI Managing Director Monika Reule. Despite this decrease in demand, German wines managed to maintain a market share of about 45% in the domestic market.
