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The wine market is a constantly moving landscape driven by ever-changing demographics on the consumer side as well as new discoveries in wine-grape growing areas and little-known varietals on the production side.

In the U.S., we clearly see two diverse groups driving the market with the baby boomer generation offering the stability of tradition and the millennials demonstrating their passion to unearth something new.

The millennials are generally defined by demographers as those born between 1982 and 2000 and number about 83 million with many not yet reaching the legal drinking age. Baby boomers were born between 1946 and 1962 and number about 76 million.

While most baby boomers did not grow up with wine on the table as a commonplace companion to the evening meal, the opposite is true of the millennials. Having a far deeper understanding of wine at an earlier age than their parents’ generation and growing disposable income, the trade views them as a lucrative market opportunity and the true future of the wine business for decades to come.

Baby boomers are the mainstay of the traditional market — cabernet, chardonnay, Champagne, Burgundy, Bordeaux, etc., and are the primary buyers of aged wines appearing on the auction circuit. Given their entrenched buying profile and increased buying power, they support the higher end of the market.

Millennials, on the other hand, are looking for new discoveries, and gravitate to more moderately priced wines from often obscure growing areas and varietal composition. For them, quality seems to trump origin, and with this focus they are setting the trends to come.

Crazy names, funky labels and nontraditional packaging are just a few of the directions set by the millennials in today’s market. The “red blend” category was essentially unheard of just 10 years ago but is now one of the leading segments of the market and more are coming on board every year. Prosecco has replaced Champagne as the leader in the import sparkling wine group. Dry rosé is hot, and varietals such as albariño, pinot grigio and torrontés are now readily available in restaurants and at retail.

With the push for something new, restaurant by-the-glass programs have matured, offering a wider variety of choices and far better quality than just a decade ago. Driven by the millennials this affords a fertile field for experimentation and discovery.

The prices may be a bit higher but the experience is much more satisfying often leading to additional purchases, brand/varietal identity and even more discovery.

According to Shanken’s Impact Databank Review and Forecast, the wine market has just registered its 22nd consecutive year of growth largely paced in recent years by the millennial generation as well as moderately priced sparklers. Today, the U.S. is the world’s leading market for wine with its growing appeal to the younger generation while that same demographic is shrinking in the more traditional bastions of the Old World.

Americans may drink far less wine per capita than people abroad, but more Americans are drinking wine than ever before and to a great degree it’s the millennials leading the charge. Matt Kramer (Dec. 15, 2015, Wine Spectator) describes the changing market from the mid-1960s to today by observing, “We’ve progressed from a decidedly non-wine culture to one where wine is now irrefutably ‘normal.’ That’s the most meaningful change of all.”

It was the baby boomers who initiated this market evolution and the millennials are currently advancing it to new heights. Now the challenge for wine producers, importers and marketers is to understand the underlying trends, demands and perspective of this most lucrative generation in order to convert their passion for discovery into the long term stability exhibited by the baby boomers. And again according to Kramer, “The best is yet to come.”

My Dec. 11 column, “What’s in a label?,” attracted several comments and questions mostly expressing confusion when reading a wine label and how to simplify the process.

Mel — You mentioned there are no regulations on terms such as reserve and old vines but then go on to say that Riserva, Cru and other terms are strictly regulated. That seems confusing.

For domestically produced wines there is no legal definition for Reserve and several other commonly used names. But in the Old World, terms such as Riserva, Cru, etc., are strictly controlled by the governing body of the country of origin and the grapegrowing area. For domestic wines, these terms are essentially used for marketing purposes but in the Old World they are seen as an expression of quality and origin.

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Allen Balik, a Napa resident, has been a wine collector, consultant, author, fundraiser and enthusiast for more than 30 years.


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