Red Wine Market by Type (Merlot, Cabernet Sauvignon, Pinot Noir, Zinfandel, and Others), Sales Channel (Off-trade and On-trade), and Regional Analysis (North America, Europe, Asia-Pacific, and LAMEA): Global Opportunity Analysis and Industry Forecast, 2021–2028

Global Red Wine Market Analysis

The global red wine market size is predicted to garner $2,42,822.34 million in the 2021–2028 timeframe, growing from $1,46,173.63 million in 2020, at a healthy CAGR of 6.60%. 

Market Synopsis

Strategic alliances among market players, along with growing demands for premium ingredients in wine, is expected to accelerate the growth of the red wine market.

However, high cost of red wine along with serious health issues caused by high wine consumption might be some of the growth-restricting factors for the market.

According to the regional analysis, the Asia-Pacific red wine market size is anticipated to grow during the review period and generate revenue of $55,849.14 million, with CAGR of 7.40% due to increasing consumption of red wine in weekends among youngsters.

Red Wine Overview

Red wine is a type of alcoholic beverage that is made up of crushed and fermented dark colored grapes. Also, there are many types of red wine such as Merlot, Zinfandel, and Cabernet Sauvignon and they all vary in terms of color or taste. Moreover, amount of alcohol present in red wine is between 12–15%. Also, ingredients present in red wine such as alcohol antioxidants help in preventing coronary artery disease that leads to heart attacks.

Covid-19 Impact on Red Wine Market Shares

The novel coronavirus pandemic had a devastating effect on several industries. The global red wine market experienced a moderate growth during this period. Red wine market growth was affected due to the outbreak of COVID-19 in three different ways such as demand, production, supply chain, and market disruption. Also, ongoing travel restrictions along with closing down of restaurants, bars, and pubs are some of the factors that decrease the market for red wine.

On the other hand, there are many research ongoing to check the effect of red wine on immunity and to fight against the COVID-19. For instance, a research article published by China Medical University, in February 2021, revealed that tannic acid present in red wine has anti-inflammatory and antioxidant effects that can inhibit two enzymes that are critical for COVID-19. The above-stated factors show that the pandemic may generate substantial investment opportunities in the market in the coming years.

Increasing Prevalence of Premium and Flavored Red Wines to Surge the Market Growth

The global red wine industry is witnessing a massive growth mainly due to increasing demand for flavored and premium red wines that carry additional health benefits such as lower risk of heart stroke, enhanced bone density, and improved immunological function. Moreover, increasing demand for recreational activities, along with changing lifestyles may boost expansions, which are major factors expected to fuel growth to the global red wine market.

Furthermore, companies that are emerging in red wine industry are already leading market players to innovate strategies for customers. For example, in January 2021, E. & J. Gallo Winery, a family-owned winery company, announced that they have acquired well-known brands of wine such as Clos du Bois, Arbor Mist, Hogue, Manischewitz, Taylor, Wild Horse, Ravenswood, and Taylor. The main aim of this acquisition is to expand company’s portfolio across the globe. These types of initiatives from market leaders are also predicted to drive the growth of the market.

To know more about global red wine market trends, drivers, get in touch with our analysts here.

High Cost of Red Wine to Restrain the Market Growth

The red wines are costly due to high taxes on import & export of red wine, therefore making it unaffordable for many people. This factor is expected to restrain the growth of the global market during the forecast period. Moreover, best red wine in the market is costlier and its high consumption can cause health issues such as liver and pancreas related diseases. These are some of the factors anticipated to hinder the market value of the red wine market in the next few years.  

Growing Demand for Organic Red Wine to Create Massive Investment Opportunities

The global red wine market is spreading at a very fast pace due to increasing demand for organic red wine. Also, organic wines are trending in countries such as Argentina, Italy, France, Australia, and New Zealand owing to benefits of organic wines. Organic wines are produced by using indigenous yeasts; also, organic red wines are free from additives and sulfur. All such aspects thereby are positively affecting the market growth.

Furthermore, red wine industry already has leading market players innovating strategies to attract customers. For example, National Liquor News, in September 2021, revealed that pandemic pushed consumers to adopted organic wine owing to its health benefits such as it is rich in antioxidants, it lowers down the cholesterol along with this it keeps heart healthy. All such aspects may further lead to lucrative market opportunities for key players in the upcoming years.

To know more about global Red Wine market trends, opportunities, get in touch with our analysts here.

Source: Research Dive Analysis

The merlot type sub-segment is predicted to have a dominating market share in the global market. The sub-segment is expected to register a revenue of $64,640.49 million during the forecast period. Merlot wines are the most preferable red wines due to their richly redness with resveratrol antioxidants. Also, merlot red wine when consumed in moderate amount, lowers the risk of blood clotting, heart diseases, and improves gut health. Moreover, according to news published by the drinks business, in August 2020, Kylie Minogue, an Australian singer/actress and Benchmark Drinks, a London-based distributor and brand manufacturer of wines were in a partnership. As a result of this partnership, they launched merlot and sauvignon red wines across the UK; the grapes that are used in wine manufacturing are from France. These factors and strategic alliances may bolster the growth of the sub-segment during the forecast period and red wine market demand.  

The cabernet sauvignon type sub-segment is predicted to be the fastest growing in the global market. The sub-segment is expected to register a revenue of $50,819.93 million during the forecast period. Also, there are many research ongoing for health benefits associated with cabernet sauvignon red wine. For instance, according to research article by Mayo Foundation for Medical Education and Research (MFMER), antioxidant present in red wine may increase the level of HDL (high-density lipoprotein) cholesterol and it improves the function of cell layers that can line blood vessels. These factors may bolster the growth of the sub-segment during the forecast period.

Source: Research Dive Analysis

The on-trade sub-segment of the global red wine market growth is projected to have the fastest growth. It is also projected to surpass $1,17,090.59 million by 2028, with an increase from $70,066.30 million in 2020. This growth in the market can be attributed to growing trends of celebration and party culture among the young generations across the globe. Moreover, reopening of restaurants, hotels, and bars after lockdown will attract people to consume red wine and other alcoholic beverages. All such elements may increase the demand for the sub-segment and red wine market demand.  

The off-trade sub-segment of the global red wine market is projected to have the dominant share. It is also projected to surpass $1,25,715.23 million by 2028, with an increase from $76,094.91 million in 2020. The growth of off-trade sub-segment is attributed to increasing demand for supermarkets, hypermarkets, wine shops, and kiosks as they offer super-sized shopping experiences with suitable red wine products. Moreover, in bigger cities especially in metropolitan cities, people are preferring off trade sales channel. Also, in 2020, according to IWSR Drinks Market Analysis, approximately more than 80% sales of alcohol in the US were generated by off-trade sales channel, thereby driving the global market for red wine and the sub-segment.

Source: Research Dive Analysis

The Market for Red Wine in North America to be the Most Dominant

The North America red wine market accounted $57,592.41 million in 2020 and is projected to register a revenue of $98,343.05 million by 2028. The extensive growth of the North American red Wine market is mainly driven by high disposable incomes with existence of top leading companies augmenting the industry growth in the region. Moreover, growing trends of vibrant wine culture across US, Canada, and other countries are some of the factors that are fueling the market growth across the region. These factors will ultimately drive the demand for the red wine market across the region.

The Market for Red Wine in Asia-Pacific to be the Fastest Growing

The share of Asia-Pacific red wine market is expected to rise at a CAGR of 7.40%, by registering a revenue of $55,849.14 million by 2028. The growth shall be a result of rising party culture, hotels, restaurants, and bars along with increasing per capita income of people. In addition to this, China is one of the most leading wine markets in red wine. Such aspects may bolster the demand for red wine market, in the upcoming years.

Competitive Scenario in the Global Red Wine Market

Product launches and mergers & acquisitions are common strategies followed by major market players.

Source: Research Dive Analysis

Some of the leading red wine market players are E & J Gallo Winery, The Wine Group, Castel Group, Treasury Wine Estates Limited, Constellation Brands Inc., Rémy Cointreau SA, Brown-Forman, Diageo plc. Altria Group, Inc., and Heineken N.V.

Porter’s Five Forces Analysis for the Global Red Wine Market:

• Bargaining Power of Suppliers: The product suppliers of red wine market are high in number and are larger and more globalized. So, there will be less threat from the suppliers.
  Thus, the bargaining power of suppliers is low. 
• Bargaining Power of Buyers: Buyers demand cost effective red wine that give health benefits. This has increased the pressure on the red wine providers to offer the best red wine in different flavors. This gives the buyers the option to freely choose red wine that best fits their preference.
  Thus, the bargaining power of the buyers is high. 
• Threat of New Entrants: Companies entering the red wine market are adopting various innovations such as developing red wine that are available in different flavors and textures.
  Thus, the threat of the new entrants is moderate.
• Threat of Substitutes: There are different types of alcoholic beverages available for consumption, but red wine is the best choice because it is healthier as suggested by many studies.
  Thus, the threat of substitutes is low.
• Competitive Rivalry in the Market: The competitive rivalry among industry leaders is rather intense, especially between the global players including E & J Gallo Winery and The Wine Group. These companies are launching their value-added services in the international market and strengthening the footprint worldwide.
  Therefore, competitive rivalry in the market is high.