Covid Analysis: How the Wine Industry has Changed and Adapted

While the Pandemic has had irreversible effects on several business sectors, the alcohol industry has experienced a bitter-sweet impact.

One of the positive effects that the pandemic has had on wine and other alcohol is the boost in global sales. According to Forbes, some of the wine-sales sector’s most prominent names saw unprecedented numbers during the first few months of lockdown. Winc, who does direct-to-consumer wine club sales, saw an increase of 578% in new member sign-ups. Vivino also recorded a 160% increase in the U.S.A., highlighting how drinking habits have changed during the pandemic.

While millennials will drive the future of wine sales, it is inevitable that new trends will immerge. This shift will see the rise of wines with low-alcohol and that are environmentally-conscious. Additionally, sales of affordable wines will increase, with a dramatic drop in premium wine sales.

Many experts suggest that these sales will not continue for long, and they believe that the wine industry will change dramatically. While the sales have had a positive effect on the industry, the average U.S. winery will likely lose more than 60% of its sales. This drop in sales is primarily contributed to the shift from on-consumption to off-consumption sales.

On-Premise and Off-Premises Sales

One of the most significant changes Covid has initiated is the stark difference between on-site consumption vs. off-site consumption.

With all the regulations in place that prevents social gatherings, the hospitality industry has suffered tremendously. On-premise sales in bars, restaurants, and wineries have virtually disappeared. This has been replaced with at-home drinking, significantly boosting the retail sector. Many wineries have used this shift to boost sales with the use of customer referrals. The Impact of Wine Referrals and Incentives can dramatically increase sales, regardless of which industry it is.

To keep their head above water, many restaurants and bars have created wine-and-food delivery services. Meanwhile, wineries have developed innovative ways to sell more wine.

These innovations have allowed several businesses to ride out the current struggle that the pandemic effects have brought.

Innovations in the Industry

Despite the challenges that Covid has brought to several sectors, it has also created an opportunity for major innovation.

Many businesses had to adapt and find new ways of bringing in business. This is especially true for those in the hospitality industry, where business owners have their hands tied. Nonetheless, the industry has proven how resilient and innovative it can be.

One of the most significant innovations we’ve seen in 2020 and 2021 is the concept of virtual tastings. Wineries have taken advantage of modern-technology and allowed their customers to experience their wines better via virtual tastings. Wineries in Michigan have turned to virtual tastings and one-penny shipping costs. This allows them to increase their sales during the pandemic.

More traditional sales tactics have also increased dramatically during the pandemic, including telephonic sales and e-mail marketing techniques. The pandemic has allowed these sales channels to be refined for better results than in the past. To master this technique, it is crucial to improve sales scripts and find Authentic Ways to Improve your E-mail Click-Through-Rate.

Whatever technique wineries have tried, the pandemic effects are clear. These effects have been both exciting and nerve-wracking. With Lessons Learnt in 2020, we knew that technology is necessary if the wine industry wants to move forward. There are ways to Maintain Sales During the Pandemic and pull through these challenging times for all sectors. For the hospitality industry to survive, it is crucial that we adapt, innovate and get ahead of any current trends.

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From our GOLD Partner Patricia
Fascinated by the many facets of wine and wine businesses, Patricia has spent years learning about wine, educating consumers about the product, as well as wineries about their business. She strives to bridge the gap between producers and consumers and help everyone to a better wine life.

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