© 2018 CiderLikeWine.com | CLW Consulting

  • John Hoyos

The $10 Cider Bottle Myth


It's A Myth, I tell you! A Myth!

Yeth?


Whatever colloquial term you use in the U.S. for the place where you purchase cider to go, you'll invariably find a selection of single serve bottles in the $7-15 price range. Buy those bottles while you can. The $10 cider bottle has a narrow future.


I touched on this a little bit in It's My Cider In a Box, but I felt this was important enough to expand upon further. The wine market moves volume of moderately priced ($10-15) bottles. There is value in these bottles because there is money to be made for the retailer. There needs to be because the retailer must take the time to hand sell these unknown products. True, the interwebs are full of reviews from every Johnny or Janey-Drink-Lately, but the older generation relies on relationships to buy their wine. They get to know wine retail salespeople who are willing to learn their palate (as much as they know their palate, which most don't). And they use their loyalty as a form of currency to haggle for discounts that they were likely to get anyway. All cynicism aside, this isn’t that far from the truth.


However, its the baby boomer generation that engages in a lot of this and they are starting to age out. Yes, eventually death claims us all, but as anyone ages, drinking habits are reduced. For the majority of us, we just won’t (or can’t) drink as much as we used to. So baby boomers will be buying in volume less frequently than they once did and wine sales will slow down.


The other challenge is that this model was created when it was possible to work full-time in a wine shop and make a decent living. As the gap between rich and poor continually increases and as inflation rises, this will continue to be problematic. But I digress.


Cider’s rise will come with the younger generations that have discovered it. They will know what they want to try because they will be reading reviews while they shop. They already do this. They will also do something previous generations haven’t done. They will do math. I admit, that may be the greatest leap of faith in the history of mankind. Generally speaking, consumers are uninformed and the one thing they can’t be counted on (or have time) to do is think. (For proof, look no further than the Growler craze in craft beer. Most 64oz growlers cost more than a 6-pack of 12oz bottles or cans.) However, cider holds this wild card packaging advantage that beer and wine do not.

Consumers already accept the 12oz can or bottle of cider in a 4-pack or 6-pack. And they already accept the wine bottle package as well. But no one is buying cider in volume when it’s in the wine bottle package because they can get fershnickered on the 6-pack bulk purchase. 72oz for $10 beats 25oz for $10 every day of the week, twice on Sunday and three times on holidays. This would seem to put a nail in the coffin to my point that cider can exist and thrive in a wine-like retail state; save one important factor, I would agree. Frankly, this is why I’m so enthusiastic about the future of cider.


People are becoming more aware of their drinking habits. They are becoming more selective about what they drink because they will not drink as much as previous generations. They are discovering that alcohol can be consumed moderately and enjoyably. And when you know you’re not drinking a lot, you’re more willing to buy one good bottle than three mediocre bottles. It’s very rare for me to buy a 6-pack of anything anymore because I just don’t want to drink six of anything. I want variety. Consumers are starting to seek this variety because the rise of craft beer has told them it’s available. The seven million flavors of vodka doesn’t hurt this cause either.


The conclusion is that cider will thrive in two package options: bulk (6-pack or keg) and high-end (wine bottle). The high-end will get much higher because the profit for the cider maker is the only way they can survive. They cannot achieve the volume they need to keep the lights on by selling ciders at $10-15 a bottle. Hence, this squeezed market will all but disappear. You may find a few brands that survive because they produce enough bulk in other ciders (or other ways) to stay in business. But by and large, the cider makers that produce the finest cider will have to make more profit per bottle in order to survive.


Of course, once one entrepreneur decides to apply the private label wine format to cider, this could all change. Seemingly, that would have it’s limits based on how technology has changed how we purchase alcohol, but some folks like to hang on to old ideas and apply them to new things just to see if they work. I don’t know anyone like that.

44 views