Port has weathered innumerable economic fluctuations over the years. After all, Portugal’s Douro Valley is the world’s oldest delineated wine region, with boundaries drawn in the 1700s. A sweet, fortified wine, Port is easy to love—the opposite of an acquired taste. At first glance, it may seem that little has changed for the category over generations, as many producers have existed for centuries. And while Port volumes remain stable, premium-and-above non-vintage expressions are having success as consumers move toward the middle of the pricing ladder—up from the standard rubies and tawnies and down from top-tier vintage Ports. Even with the move away from vintage Port, premiumization is driving higher values.
Vintage Port, for centuries a star of the drinks industry for its depth and rarity, poses practical challenges. A bottle of vintage Port needs years or even decades of cellaring. It may prove challenging to open if the cork is dry and the wine requires decanting. Also, vintage Port must be consumed within hours of opening. In contrast, the types of Port that are popular today are ready to drink upon purchase, easy to open, require no decanting, and can last for a month in the refrigerator after uncorking. From the producers’ perspective, they’re scalable with great potential for growth, according to Rupert Symington, CEO of Symington Family Estates, which has a portfolio that includes Graham’s, Cockburn’s, Dow’s, Warre’s, and other brands.
“With our last two vintage declarations, we deliberately and dramatically scaled back quantities to ensure sell-through,” Symington says. “The rarity factor, which is enhanced by the fact that we release our top wines only every three or four years on average, is a key ingredient in generating excitement among the trade and consumers.” While vintage Port’s production is, by definition, small, Port houses can potentially increase production of non-vintage styles such as reserve ruby, late-bottled vintage (LBV), tawny with an age indication, single quinta, and single-vintage tawny, also known as colheita. Although the labels of the latter three styles indicate a harvest year, the products are still considered non-vintage.
“The major players comprise nearly all of our Port business,” says Gary Fisch, founder and CEO of Gary’s Wine & Marketplace, which operates five stores in New Jersey. Port sales at Gary’s surge when producers declare a vintage. “We bought heavily into the 2016 vintage, which arrived in mid-September 2018, so we’re experiencing a spike,” says Fisch. “We have the largest Port inventory we’ve had since the 2011 vintage.” Port SKUs at Gary’s range from 50 when there hasn’t been a vintage declaration to 65 when there has, as in 2018. Among the 2016 vintage offerings are Graham’s ($100 a 750-ml.), Fonseca ($90), and Taylor Fladgate ($90). When the vintage Ports roll in, sales of non-vintage Ports concurrently swell, as customers drink them while their vintage bottles age. The two top sellers are neck and neck—Graham’s Six Grapes ($19) and Fonseca Bin 27 ($14)—followed by Graham’s 20-year-old tawny ($40). “Graham’s has emerged as an impact player,” Fisch adds.
Non-vintage Ports have moved into the spotlight on-premise, with tawny and LBV styles eclipsing both vintage and entry-level expressions. At Chez François in Vermilion, Ohio, co-owner and wine director Matthew Mars says Port is a strong year-round seller. “Port glass sales outperform bottle sales by a wide margin, and Port outsells all after-dinner spirits,” Mars says. He pours eight Ports by the glass and 26 more by the bottle, including the 1963 Fonseca ($1,000 a 750-ml.). “We sell far more tawny and LBV than vintage Port, as the staff finds them straightforward to sell, and there’s no need to use up the entire bottle,” Mars notes. The top sellers are Graham’s 10-year-old tawny ($12 a 2.5-ounce pour; $75 a 750-ml.) and Graham’s 20-year-old tawny ($18; $100). “We engage and educate our guests on the category by suggesting dessert pairings and offering complimentary pours,” Mars says. “Some nights I open a bottle of vintage Port, and the staff suggests it until we sell through.”
Symington attributes the increase in the value of Port shipments to the growth of reserve rubies and aged tawnies at the expense of standard-quality expressions—a trajectory he expects to continue. “Ten- and 20-year-old tawnies have, to some extent, replaced vintage Port on-premise owing to their suitability for dessert pairing, their ease of serving, and their longer shelf life once opened,” he says, adding that the category has shifted somewhat to retail sales, including grocery chains. “Port, once the preserve of collectors at the high end and an inexpensive grocery item at the low end, has developed a significant following in the $15-$25 range.” Quality remains high at that level. “By bottling less vintage Port, we must necessarily declassify a lot of wonderful wines, which enhance the quality of the next tier, such as Dow’s LBV and Graham’s Six Grapes,” Symington explains.
Most of the Symington Ports are imported by Premium Port Wine, which is owned by the family. Their Warre’s line, however, is imported by Vineyard Brands, which brought in 38,000 cases of Port in 2018, including top-selling Warre’s Otima 10-year-old tawny. “Port is a growth category with tremendous potential, and we see opportunities in both on- and off-premise accounts,” says Gregory Doody, president and CEO of Vineyard Brands. “The declaration of the 2016 vintage has renewed excitement in the category.”
Stephen Brauer, CEO of Evaton, the U.S. arm of Portugal-based wine producer Sogrape Vinhos, agrees that vintage Port benefits the category as a whole. Evaton imports Offley and Sandeman Ports, the latter of which moved over from Pernod Ricard USA in July of last year. From July-December 2018, Evaton imported approximately 29,000 cases of Sandeman to the U.S., according to Impact Databank. “The Port business in general is showing steady, 2% annual growth, but within the category there are encouraging points of light,” says Brauer. Like others in the industry, he notes that vintage Port, although the category flagship, comprises a small share of production. “George Sandeman said vintage Port is 2% of the production and 98% of the noise,” Brauer says. “We see robust growth in aged tawny Port, particularly the 10- and 20-year-old tawnies, which restaurateurs and retailers are embracing.” He says trade education will drive the premiumization trend and climbing values. “Education is our top priority for Port, so we have a full-time Sandeman ambassador who trains distributors and on- and off-premise staff and works with them on consumer tastings,” Brauer adds.
Kobrand Corp., which imports the Fonseca, Taylor Fladgate, Croft, and Krohn brands, offers on- and off-premise training as well. “Port in the U.S. is a mature, stable category, but has recently turned to growth, driven by aged tawny Ports,” says Kobrand president and CEO Bob DeRoose. The company’s initiatives focus on reaching consumers aged 25-34 through digital ads, blogger partnerships, and a presence at chocolate shows. “We’re also partnering with hospitality schools to offer Port seminars to legal-drinking-age students to cultivate their appreciation for Port as they grow in their careers,” DeRoose says. He adds that simply suggesting Port for the dessert course would increase on-premise sales.
At the Bellagio Casino & Resort in Las Vegas, director of wine Ernest Taketa trains the staff at multiple dining venues to suggest Port with dessert. “When conducting Port training, we discuss the different styles, aromatic characteristics, and, most importantly, how Port pairs with food,” Taketa says. The MGM property pours eight Ports, seven of them by the glass. Staff pairings drive sales of the two leaders: the 2011 Dow’s LBV Port ($9 a 3-ounce pour; $152 a 750-ml.) with the celebrated Le Cirque chocolate ball, made up of white chocolate ice cream and a hazelnut caramel crunch; and the 1985 Dow’s Port ($11; $259) with chocolate fondant lava cake. The Bellagio’s Port volumes have remained stable over the past few years, Taketa notes.
The gravitational pull toward higher-end Ports seems to outweigh slight declines in volume. “Overall, there’s been a decrease in Port volume, but our Port sales are at the premium level,” says Diego Lo Prete, senior vice president and general manager of Winebow’s MundoVino division, which imports the Wine & Soul and Quinta do Passadouro labels. “While entry-level ruby and tawny Ports have been in decline, there’s growth in vintage, LBV, and colheita Ports, as well as in tawnies with an indication of age, and high-quality white Ports.” Lo Prete finds on- and off-premise wine buyers to be well-versed in Port styles, and notes the importance of innovations to attract a new generation of Port enthusiasts in light of the category’s maturing demographic.
At Wilbur’s Total Beverage in Fort Collins, Colorado, managing partner Mat Dinsmore also notes that Port sales are driven by mature customers. Port volume at Wilbur’s has been stable over the last few years, with a seasonal spike for winter occasions and gifts. “As our older and more expensive Port SKUs sell through, we’ve replaced them with LBV, higher-end tawnies, and rubies,” Dinsmore says. The store has bumped up its Port selection over the past few years, stocking 75 SKUs. Strong sellers include the 2012 Taylor Fladgate LBV ($23 a 750-ml.) and Dow’s Fine tawny ($14). Interest is growing in aged tawnies such as Fonseca 20-year-old ($53).
Teaching The Trade
Industry insiders say the key to cultivating a passion for Port among a new generation of consumers is trade education. Frederick Wildman & Sons, which imports more than 2,000 cases annually of Churchill’s Port, hosts a yearly dinner for on- and off-premise wine buyers to raise awareness of Port’s food-pairing potential. “The Douro Valley produces top-quality wines that tend to be underrated and under-appreciated,” says Anthony Cohen, marketing director of French and European estates at Wildman. “It will take time to educate retailers and restaurateurs on the region’s terraced vineyards and extreme weather, but as the secret is revealed, I predict great opportunities for Port in the long term.”
The jury is still out on marketing Port as a cocktail ingredient to boost sales and increase awareness. Kobrand has been the leader in this arena, engaging well-known mixologists for multiple brands, including Fonseca Siroco white Port and Croft Pink, which is a rosé Port. Winebow’s Lo Prete says marketing Port as a cocktail ingredient may open the door to increased penetration in the trade, as happened with Sherry. Others, including Symington, believe marketing Port as a stand-alone after-dinner sipper will produce more enduring results.
A more promising strategy may be to emphasize Port’s value proposition. Fisch says both novice and experienced collectors compare Port prices to those of similarly scored wines from Burgundy, Bordeaux, and Napa Valley—and Port prevails. “My customers buy cases of vintage Port rated 97 or 98 by Wine Spectator for only $90 a bottle,” Fisch notes. “If you think of how much a Napa wine with the same rating would cost, vintage Port is a bargain.” Fisch says his customers never compare Port to spirits in terms of price; however, Symington points out that Ports aged ten years and older are relatively inexpensive compared to similarly aged spirits. Thus Port’s comparative value could potentially pan out in enhanced on-premise sales.
Importers are optimistic about Port’s prospects in the U.S. market, particularly in value terms. “I’m quietly bullish,” says Evaton’s Brauer. “We won’t see explosive growth in volume, but we could see 6%-7% growth in value.” Along with other importers, Brauer predicts the widely reported surge in travel to Portugal will positively impact Port business in the U.S.
“Port is not, and probably never will be, a mass-market product, and it lies very much at the end of the wine experimentation curve,” Symington says. “In the long term, I have great expectations in value terms for Port sales in the U.S., particularly with new media enabling us to share our stories directly with consumers, and with a new generation of affluent wine enthusiasts keen to discover lesser-known, authentic niches of the wine world.”