Rising Trend: German Fine Wines Increasingly Sold Directly from Producers

German wine enthusiasts are increasingly opting to purchase high-quality wines directly from the producers, reflecting a growing desire for authentic connections with winemakers. According to the President of the Verband Deutscher Prädikatsweingüter (VDP), Steffen Christmann, this trend is evident as the share of sales made through direct-to-consumer channels increased by 3.5 percentage points in 2024 compared to the previous year, now accounting for one-third of total sales.

In some wineries, direct sales can constitute as much as 80% of their total revenue. This shift marks a significant turnaround, especially considering that a decade ago, direct sales were often viewed as a declining model.

Aside from on-site purchases, VDP wineries are also leveraging online platforms for sales, with their own webshops contributing 11% to total sales figures. Third-party online retailers account for around 5%. Additionally, over 25% of these fine wines find their way into specialty retail, while around 17% are sold directly to restaurants. The grocery sector represents a modest 6% of the sales.

As digital sales channels become increasingly important, nearly 90% of VDP wineries are planning to expand their online direct sales efforts. This includes enhancing their presence through personal online shops, social media, newsletters, virtual tastings, and podcasts.

Social media, particularly platforms like Instagram, plays a crucial role in this direct sales approach. Consumers are drawn to the authenticity of the winemaking process and the stories behind the products. Quality of engagement on social media is more critical than frequency; consumers favor meaningful content that allows them to connect with the winery's daily operations.

Turning to the 2024 vintage, challenges such as severe weather conditions, including frost and high fungal pressure, have resulted in a notably lower yield, comparable to levels not seen in the past 15 years. Despite this, significant price hikes are not anticipated. The average price for a VDP estate wine (0.75 liters) is approximately EUR11.50, while the top-tier wines from prime vineyards, known as Große Lagen, typically retail for around EUR40, with the finest selections costing an additional EUR8 to EUR9.

For context, the average cost of a bottle of German wine is reported at EUR4.47 per liter.

However, the sales volume for VDP wineries saw a decline last year, totaling 35.7 million bottles--a 10% reduction compared to the previous year. Interestingly, while sales volume has decreased, revenue only dipped by 3%, amounting to about EUR446 million.

The 202 Prädikatsweingüter are gathering in Mainz for their wine fair, which is recognized as the largest exhibition dedicated to German fine wines. These producers manage nearly 6% of the total vineyard area in Germany, along with almost 18% of the country's organic vineyard space.