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Australian millennials drive wine consumption post-pandemic

Australian wine consumption remains on a downward trajectory, but younger millennial drinkers have become a major driver of behaviour in wine during the pandemic.

Australian millennial wine drinkers driving consumption

Overall wine volumes declined by approximately -1% CAGR, 2016-2021. But spend per bottle has increased, as Australian consumers moderate their consumption and choose better quality products to drink, according to a new report from Wine Intelligence.

A demographic shift in Australia’s wine drinking population is driving this trend. Millennials and younger legal drinking age (LDA) consumers are driving wine consumption in Australia, I’m part as a result of the pandemic.

The proportion of regular wine drinkers in Australia above the age of 55 fell by -7% between 2018 and 2021, down to 29%.

The percentage of wine drinkers aged 25-44 rose from a third (35%) to 44% in the same three years.

Newer consumers appear to value the idea of buying something more personal, unusual, and meaningful, which is typically more artisanal, and more expensive, according to analysis by Wine Intelligence. This group differs from their elders in that they are looking more for variety and experiences, and are less moved by low prices, or reliable and familiar brands.

Wine Intelligence data suggests a link between recent purchasing channel changes caused by the pandemic and exploratory behaviour.

The major drivers of e-commerce wine growth are millennial drinkers. This e-commerce environment – particularly direct-from-producer – lends itself better to uplifting narratives and quirky products than a mainstream retail environment.

But is this new trend set to stick?

Following a slow start, vaccine rollouts have been effective in Australia, and travel is starting to open up.

Foot traffic in Australian shopping districts and supermarkets, as measured by Google Community Mobility Reports, appears to be close to the pre-pandemic baseline of 2 years ago.

Evidence collected by Wine Intelligence, from July 2021, suggests that consumers are still less likely to go out to bars, or to attend social events compared with pre-pandemic. But socialising outdoors and going to restaurants is now as likely as it was before Covid.

They are more likely to be treating themselves to better wines, but less likely to attend a sporting event or travel by air. Shopping for wine in physical stores is more likely, but so is shopping for it online.

We are yet to see how much pushback there will be from large retailers and bigger brands, whose grip of the market has lessened as a result of Covid.

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