IWSR reports that the era of rapid growth in buying wine online may be over, with global wine ecommerce on a downward trajectory following a surge through the pandemic lockdowns.

The value of global wine ecommerce declined by -6% in 2023. As spirits and beer/cider/RTDs brands have invested more heavily in the channel in recent years, wine’s share has been eroded, and IWSR expects this to continue.

“The proportion of wine purchasers online has decreased year-over-year following the surge through the pandemic lockdowns,” said Guy Wolfe, Head of Ecommerce Insights, IWSR. “Wine buyers have returned to the on-trade and physical retailers, while economic pressure has impacted non-essential spending.

“To protect market share, wine brand owners should ensure they have a good understanding of the types of consumers that are driving online wine growth.”

Millennial consumers – who are more frequent purchasers of wine in ecommerce and are less likely to be deterred from buying online – will be crucial to the future of the channel, but demographics and consumption trends vary hugely between countries.

“Markets with established wine consumption, such as Europe, Australia and the UK, tend to have an older online wine consumer base with a larger proportion of Boomers and Gen X,” said Richard Halstead, COO Consumer Insights, IWSR. “In emerging wine markets such as China and Brazil, Millennials and LDA Gen Z are the main online purchasers of wine.”

In Australia, Italy, France, the UK and Spain, for example, Boomers and Gen X make up more than 60% of online wine purchasers; but Millennials and legal drinking aged Gen Z account for the majority of buyers in China (80%) and Brazil (64%). The US sits in the middle, with 43% of online wine buyers Millennials.

Markets with a relatively younger adult consumer base – including Brazil, China and the US – show a higher frequency of purchase than other markets, and are driven by treating and purchases for social and special occasions, typically with fast delivery.

However, in those countries with older consumer bases – such as the UK and Australia in particular – purchasing is less frequent, and is motivated mainly by stocking up and bargain hunting.

Countries with a younger adult consumer base favour apps and handheld devices: in Brazil, 81% of online wine purchases are made using a smartphone or tablet; in China, the figure is 78%, and in the US, 62%.

These figures, however, drop in markets with older consumer bases such as Australia (45%), the UK (42%) and France (31%). This also reflects the more established sale of wine online via specialist websites and supermarkets in these countries.

The contrast in consumer behaviour extends to expectations around delivery times. A sense of urgency means that many online participants are happy to pay more for one-day delivery, particularly in countries with a younger consumer base.

However, older groups and markets with older consumer bases have less urgency – possibly because they are motivated by the need to stock up, rather than requiring wine for a specific occasion – and are less willing to pay extra.

What’s driving wine’s structural decline?

Aside from ecommerce, wine is struggling for market share generally.

In Australia, the peak for wine consumption was in 2012 and, unlike many other countries, it didn’t benefit from a Covid-era boost. Its per-capita consumption is now 11% lower than it was in 2000.

According to IWSR factors driving the decline are that consumers are increasingly interested in moderation as a health and wellness lifestyle choice, and there is also a greater tendency to socialise without alcohol.

There is also more competition from other categories.

“Given the huge changes in the beverage alcohol market in the past decade and a half, including the increased availability of speciality drinks; the growing fashion for cocktails; and the widespread uptake of smartphones, giving consumers the ability to find information quickly, and to carry out transactions; wine has faced lots of competition from an increasingly adventurous alcohol consumer,” said Halstead.

Younger adult wine consumers are generally participating in wine less often: IWSR long-run data shows that frequency of consumption is on a downward trend in many markets. For example in Australia, monthly+ wine consumption amongst LDA-24s has halved between 2010 and 2023.

Premium rosé is bucking the trend, with the US, UK and Australia key markets for premium rosé brands. IWSR said they often offer fresh, easy drinking styles and packaging that tends to be more fun and aligned with “newer” social occasions such as bottomless brunch and summer outdoor socialising.