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Private Label Wines Strike A Tone In The Market

label-wineWhen supermarket sales are parsed out, we find that in 18 months, $826 million in new Private Label (PL) wine dollars were rung up at supermarket checkout counters, second only to the gain made by the hottest beverage of them all–bottled water–which raked in $973 million in added sales during the same period.

The PL wine dollars are even more impressive when compared to the bottled water figures when you consider that only 33 states allow wine to be sold in supermarkets. No such impediment exists for bottled water. Total supermarket wine sales were $3.6 billion last year, an impressive enough figure to keep majors like Albertson’s, Kroger and Safeway interested in the PL segment since it’s growing so vigorously.

Shelf Talk

Americans consume far less wine than Europeans–approximately 8 liters per year versus 60 liters in France and Italy–but a third of US households do purchase wine, and — their increasing affinity for the grape (per-caps do keep going up), accompanied by their growing acceptance of private label wines, account for the stepped–up interest by retailers in the pursuit of PL consumers.

Austin, TX-based Whole Foods Market, with 130 stores in 26 states, bills itself as the world’s largest natural and organic food chain in the world. So it was only, well, natural, that when it got into PL wines in 1999, that in addition to non-organic wines, organics would be on its roster. Today, says’ Marc Jonna, national wine buyer for the chain, it features a full range of non-organic varietals under its 365-store brand label, with chardonnay and merlot as its organic entries.

“Our non-organics sell for a modest price,” says Jonna, “between $4.99 and $6.99, while our organics sell between $6.99 and $9.99. In both cases, this is a good time–if not the best time ever–to buy wine, since a worldwide surplus is forcing prices down. A $7 bottle today is as good, if not better, than a $15 wine two years ago.”

Burt Flickinger III, president of NYC-based Strategic Resources Group, a retail consultancy, attributes the size of the US PL wine market to the quest for short-term profits on the part of supermarket chains. “They don’t pump enough back into marketing and advertising,” claims Flickinger, thus stunting the growth of new products.

ACNielsen account manager Laura Welsh attributes it to the fact that “America is a very brand-conscious society,” so “it may not be a positive social statement to put a bottle-of retail branded private label cabernet on the dining room table while entertaining.

Her associate, account manager John Pauley, adds that a contributing factor to PL’s ultimately limited growth is that “they aren’t that much less expensive than branded products and there is no measurable ‘counterpart’ as there is in, say, a box of PL pain relievers with the same ingredients as a well-known brand. You can’t do the same comparisons with wine because a branded wine isn’t going to provide the exact same grapes for a PL version.”

Nevertheless, private label wine does keep growing. One percent yesterday; 2 percent today. As the nation becomes more comfortable with wine (and per-caps keep rising), can 3 percent be that far away…or even more?


A control brand is an existing wine carried exclusively by one retailer, while a private label (or store brand) wine is developed by a retailer, sometimes bearing the retailer’s name.

Whole Foods, as an example, has both; its private label wine is called 365, the name used by Whole Foods for non-wine items, as well. Brand 365 wines come from vineyards all over the world, ranging in price from $4.99 to $9.99.

Among its control brands, Whole Foods carries Pumari from Robert Talbott Vineyards (Carmel Valley, CA). If you crave a Pumari chardonnay or pinot noir, forget about Safeway, Kroger or Albertson’s; you’ve got to go to Whole Foods. Price: $9.99.

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