In this video Michael Girdley explains that U.S. wine consumption has fallen 15% between 2021 and 2023 – roughly 3.5 billion bottles fewer each year – and examines why the market is in freefall. He traces the industry’s rise from cheap table wine to a status‑driven luxury product, driven by aggressive marketing in the 1960s‑70s and the “French paradox” health narrative. Girdley then outlines the generational shift that is now reversing that growth: the Silent/Greatest Generation is gone, Baby Boomers are aging out, Millennials are becoming health‑conscious, and Gen Z shows little interest in alcohol. He identifies four primary forces accelerating the decline: (1) social‑media backlash and changing health messaging, (2) competition from THC products, (3) inflation making wine relatively expensive, and (4) cultural attitudes of Gen Z that view wine as uncool. The video details the business consequences, especially for full‑service restaurants where high‑margin wine sales can account for 20‑40% of profit, and for suppliers such as wine‑glass manufacturers. Girdley advises CEOs and small‑business owners to de‑risk exposure, reconsider overhead, and pivot toward emerging opportunities like mocktails, zero‑alcohol sparkling drinks (e.g., Liquid Death), and other health‑focused beverages. He concludes that constant change is the only constant, urging entrepreneurs to monitor shifting consumer preferences and adapt accordingly.
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Something not talked about very much, but is a big problem, is that the wine market is in absolute crisis. The entire industry is basically in freefall over the past couple years. By the numbers, in 2021 we peaked at per capita consumption of wine at about 3.2 gallons per person. That number has gone down 15% just in 2 years to 2023. So to put that in perspective, the wine industry consumption has gone down by 15% in 2 years. The size of that is massive. That's 3.5 billion bottles of wine less consumed per year, just in 2 years. So this video is about what's going on. Why is this happening? And what does it mean for small businesses and business CEOs? So if you're new here, my name is Michael Girdley. I love to make videos about business. I'm a 20-year-plus CEO. I'm a business nerd. I've hired hundreds of people and incubated dozens of companies. If you ask me what I love to do, I love business. It's super fun. And it's interesting because before this time, actually, wine was mostly just a very main street kind of drink. It was actually probably much more so considered a cheap drunk, right? You could go spend 50 or 75 cents, you get a full bottle of wine. And that was table wine or that kind of stuff. And, you know, it was an everyman kind of thing, not the types of things that you know, turned into where wine eventually got to, which is a lot of status games and luxury type stuff. But look, this is America, and if somebody sees something they could sell for 75 cents, they're darn sure going to try to figure out a way to sell it for $75. And marketers got involved. And of course, this is America, so we want to make money. And the California wine industry at this time blossomed from the late '60s to the late '70s. So just over the course of about 10 years, the amount of acreage used for wine grape cultivation more than doubled. Like, it was up over 144%. Just crazy. And what you had was kind of a perfect storm at this time in the '60s and '70s of 3 generations together that were all interested in being wine consumers. And so for me, I remember going through kind of the pictures of, of my grandparents during this time, and they had fought during World War II. My grandfather was on a ship in the Pacific. My other grandfather was a flight instructor. And look, as we look at industries that have proven to be some of the best marketers over the years, I think in the Hall of Fame has to the wine industry. Like, these people were really, really good. One of my favorite examples, which I guess we can decide if it was ethical or not, was starting to promote alcohol consumption and wine consumption as good for you. Like, when I was a kid— like, I'm 50 right now— and I was a kid, like, there was all kinds of media. It's like, oh, you should have a couple glasses of wine a day. And I remember my grandmother saying that because, well, she wanted to have a couple glasses of wine every day. And she definitely imbibed. And what did she use as a reason to, like, justify it? Well, what she heard on the media. And a great example of this culminated in an early 1990s 60 Minutes episode where they actually went through this French paradox. And part of the conclusion was that drinking a little bit of wine each day was actually good for you. Too much, not good for you, but just a couple glasses would be better than none at all. And then in the early 2000s, we saw a new trend, which was millennials showed up. And millennials were these folks that were kind of born 1980 to 1995. They entered the wine drinking age. And what did millennials get driven by a lot? Individuality and being special, right? Every millennial I mentioned this to, by the way, says, "I'm not special. I don't think I'm special." And I was like, "Yeah, you're not like the rest of those millennials think you need to be special. Totally get it." But what the marketing departments and the marketing movements of these wine companies did was really smart. They changed the way they started to think about wine and the way they started to talk about it, which was very much focused on individuality and uniqueness. And look, the millennials were a fantastic audience for this. They wanted to be part of what they saw as unique and cool. And all this worked really well. And it worked so well that by 2016, millennials were consuming on average 2 cases of wine per person per year. That's 159 million cases a year. And all this was going incredibly well, right? We continue to have this perfect storm of generations that really wanted to drink wine, found that wine could speak to their personal interests in life and career and professionally and home and family and all that kind of stuff. But then it all changed. And in 2021, wine consumption started to go into a freefall. So what happened? Well, the same generational stuff that was creating so much wine consumption has totally turned against it. Right? So the Silent and Greatest Generation folks, those people that were born before or fought in World War II, they're long since gone. And the Baby Boomers, well, they're getting old. And Millennials, they're getting old too. And by 2023, like, if you do the math, people born right after World War II, they're getting into their late 70s. And you know what old people discover they can't do as much anymore? Drink a lot of wine. Like, old people— I'm getting old, I'll tell you— you can't drink like you do when you're a young person. And millennials who are on Instagram and the internet all the time, they're getting older and more health-conscious too. So let's look at this all from the perspective of like a very common small business, which is a full-service restaurant that has a wine menu. Well, most of us that have bought wine at a liquor store or grocery store and then bought at a restaurant have realized very quickly that the wine on the menu at a restaurant is marked up 200 or 300%. And a typical full-service restaurant might operate at 2%, 3%, or even 5% net margins. And big chunk bunks up to 20, 30, 40% of the profit for these full-service restaurants is from this kind of high-margin alcohol sales. And if customers aren't showing up and aren't buying that alcohol, you can see what's going to happen to those restaurant profits, which are thin already to start with. Now, like most things in business, there's not one thing causing this kind of shift, but let's go through each one of them. And the first one of those is social media. Social media has drastically turned against, uh, the idea of alcohol consumption. Um, and to some extent for good reason. Like, the whole idea of the French paradox that I talked about before, where moderate consumption of alcohol is actually good for you, right? That is all actually shifting. And part of the reason I want to make this video today is there's a viral post on social media where people are talking about how the Surgeon General now wants to say that any alcohol consumption at all is bad for you and cancer-causing. Hundreds of thousands of deaths a year, all happening because of alcohol consumption. And the numbers of kind of consumer attitudes, they back up this change in perception amongst consumers. So in 2005, 22% of respondents in a survey— and I'll put the, put the link to it below— said that any alcohol consumption at all was bad for you. By 2023, that number had jumped up to 39%. And so the story of alcohol and consumption in the US is kind of interesting. Mass media and traditional media created it, and social media is kind of killing it. And the second thing going against alcohol is competition. And that biggest competitor is THC, aka marijuana. And over the past 30 years, we've seen a 15x increase in the amount of consumption of these types of products. And by 2022, we have a situation where more people are using marijuana products on the daily, like daily consumption of marijuana, than people who are drinking alcohol daily. Right? That's a radical— it's just a radical shift. And third, like inflation and costs have hit young folks incredibly hard. And wine, It's not cheap. Like a glass of wine, even at my favorite restaurant Chili's, might cost you $10 or $12 for like a middle-of-the-road glass. Why would you spend that kind of money when you could spend $5 or $6 and get a beer or a mocktail or a mixed drink? And lastly, Gen Z is the slowest to grow up and do bad things generation of any generation in history. They're delaying things like driving, getting married, and alcohol consumption. And to them, like, they just don't see the appeal. Like, why would I go get drunk? It seems like a lot of work. And in wine in particular, it definitely doesn't help that wine is seen as uncool and old and just not something hip if you're a young person. So that's where we're at today and why the wine industry is in a freefall is you have an entire generation of millennials and baby boomers that are either dying out or aging out of alcohol and wine consumption, and you have younger generations that could care less. And yeah, that's, that's why it's cratering. So what does this mean for business? Look, I think like most trends, you need to take a look at your business and identify if what's happening with demographics and tastes and people's preferences is going to affect, help, or hurt your business. And so like if I owned a wine glass factory right now, I would be looking to definitely like de-risk that deal. Like how do I, how do I make sure that I can maybe get out of that business and sell at the top? Or if I'm in a restaurant I start to think about my overhead in light of the fact that wine consumption, alcohol consumption should keep decreasing over the coming years. But this is where changing trends have the inverse effect. They're not only going to kill some businesses, they are going to help some businesses. And we're seeing the rise of things like mocktails, which are, have gotten to be very popular. And these are cocktails that are done without any alcohol at all. And we're starting to see the rise of kind of healthy party drinks. Liquid Death is kind of the most famous of that. If you haven't seen it, it is a giant flavored sparkling water with no alcohol in it. And I had one the other day. I thought they were kind of dorky. And it was pretty good. But in short, things like Liquid Death, mocktails, all that kind of stuff, they potentially create opportunities for small businesses to say, hey, with younger people, tastes are changing. And how do I modify my offering in a way that's going to take advantage of that? And look, as you think about the takeaway from all this, the big lesson is that the only constant is change, right? We're always seeing shifts in technology and society and people's attitudes and customer buying preferences in the environment. That's just the nature of the way things go. And also why so few businesses last for hundreds of years, right? They last for a year, months, dozens of years. And the thing on, on us as entrepreneurs is to be mindful of the shifting sands around us and react accordingly. And in the case of this particular one, Gen Z is thinking very differently about alcohol and specifically wine than people of my old-ass generation are doing so. And I for one am pretty excited about it. They're a great group of people. The young people will be just alright in my opinion, with or without drinking any wine.
