Navigating the New Reality of Wine: Insights from the NBBJ 2025 Wine Industry Conference

On April 23, 2025, the North Bay Business Journal hosted its 25th Wine Industry Conference, bringing together professionals across the wine value chain to reflect on the current landscape and look ahead at what’s required to navigate an increasingly complex and evolving market.

The event’s central keynote, delivered by Chris Bitter, PhD, Senior Wine & Grape Analyst at Terrain (an arm of American AgCredit), set a clear and sobering tone: while the wine industry continues to face structural headwinds, opportunities exist for those willing to adapt, rethink traditional models, and engage meaningfully with emerging consumer preferences.

A Structural Shift, Not a Temporary Dip

Chris emphasized that the wine industry is no longer experiencing a temporary slowdown, but rather it is in the midst of a structural correction. The gap between supply and demand is widening, even as harvest volumes have moderated in recent years. Despite the decline in overall volume, there remains an oversupply of wine, particularly affecting grape and bulk wine pricing. The resulting pressure has created a buyer's market and is influencing vineyard valuations and transactional activity, which are down across the board.

This imbalance is more than a supply-side issue. Wine sales, especially off-premise sales, have decreased each year since 2019. The decline is most noticeable in the value segment, while premium and luxury tiers have experienced more of a normalization following the pandemic surge.

Still, the demand at the top end is no longer rising at the same pace, creating caution even among high-end producers.

One of the more significant takeaways was the performance of white wines, which are bucking broader trends and gaining traction with consumers. Chris linked this to an aggregate shift toward lighter, crisper wine profiles, aligning with changing consumer palates and lifestyle choices.

Direct-to-Consumer: Challenges Beneath the Surface

A major point of concern addressed during the keynote was the direct-to-consumer (DTC) channel. Once a lifeline for wineries during COVID-19, DTC has shown signs of fatigue. Visitor numbers and sales volumes are down across all major West Coast regions, with total volume still below 2019 benchmarks. Although revenue is up, this growth is largely price-driven, suggesting that increased costs may be discouraging broader accessibility.

Chris pointed out that this dynamic is partially responsible for the reduced visitation,higher prices for tastings and wine experiences may be limiting consumer willingness to engage, particularly among newer and younger audiences. The mismatch between pricing strategies and consumer expectations underscores the need for wineries to re-evaluate value propositions and create more accessible, diverse experiences.

Economic Backdrop: Uncertainty and Mixed Signals

Chris’s keynote didn’t shy away from macroeconomic realities. The economic environment has grown more uncertain, with several conflicting signals:

• Positive indicators include strong wage growth, low unemployment, and manageable household debt.
• Negative indicators involve stock market volatility, growing inflationary pressures, and rising geopolitical tensions. Tariffs remain a wild card that could significantly affect pricing and export demand.
• Most concerning, however, is the sharp decline in consumer sentiment, which historically precedes pullbacks in discretionary spending—something that luxury products like wine are especially vulnerable to.

While the probability of a near-term recession remains under 50%, the keynote warned of a slowdown in consumer spending, particularly on premium goods. Chris forecasted continued softness in both domestic and export markets, alongside increasing industry consolidation and attrition as some producers struggle to find footing in this new environment.

Generational and Cultural Gaps in Consumption

Even as economic forces play out, the wine industry must confront deeper shifts in consumer behavior. Americans are drinking less alcohol overall, with health and wellness motivations playing a central role. Meanwhile, wine is losing ground to other beverage categories in terms of relevance, visibility, and cultural fit.

The generational divide is also becoming more apparent. Younger consumers (Millennials and Gen Z) are not engaging with wine at the same rate or in the same way as previous generations. Compounding this issue is the industry’s underperformance among multicultural consumers, where wine continues to under-index.

The keynote message was clear: these are not short-term trends, and waiting for consumer habits to revert is not a strategy. Instead, wineries need to adapt by delivering products and experiences that reflect the values and preferences of these emerging consumer segments.

Opportunities for a Resilient Future

Despite the challenges, Bitter offered a series of forward-looking opportunities for the wine industry to re-establish its relevance and value:

1. Reframe wine as a lifestyle product aligned with wellness values – Wine can occupy a middle ground between abstinence and excess if positioned thoughtfully.
2. Engage intentionally with younger and multicultural audiences – This means more than surface-level marketing. It requires active listening, product innovation, and authentic representation.
3. Reimagine the winery experience – Focus on repeatable, accessible, and shareable moments. Wine tourism should offer both premium and casual options.
4. Innovate through DTC – Use this channel to test new formats, styles, and storytelling approaches that are difficult to execute through traditional wholesale.

Reinforcement from Panel Insights

Panel discussions throughout the day echoed these themes. The Vintners Panel, featuring Stacey Dolan Capitani (Napa Valley Vintners) and Michael Haney (Sonoma County Vintners), emphasized the role of trade organizations in advocacy and consumer engagement. They discussed the importance of storytelling, strategic clarity, and building local community ties—especially in the face of consolidation and shifting demographics.

Meanwhile, the Marketing Panel, led by Alexis Traverso (Far Niente Wine Estates) and Luke Ammerman (Papapietro Perry Winery), focused on the importance of authentic branding, experiential marketing, and digital connection. They reinforced that younger consumers are looking for trust, transparency, and shared values, not just heritage and prestige.

Final Reflections

The 25th NBBJ Wine Industry Conference served as both a wake-up call and a call to action. Chris Bitter’s keynote delivered the tough realities with data and clarity, while panelists framed the human and marketing dimensions of the industry’s future.

The wine sector sits at a crossroads. Relying on past successes is no longer viable, and incremental change may not be enough. However, those willing to listen to the market, act boldly, and connect genuinely with a new generation of consumers have an opportunity not just to survive, but to lead a renaissance.