AAWE, Economics Dept, New York University, 19 W 4th St, 6Fl., New York NY 10012aawe@wine-economics.org

AAWE Working Paper No. 199 – Business

Kegged Wine: Current Perceptions and Experiences within the U.S. Wine Industry

Michaela Nuebling, Rhonda Hammond, Carl Behnke, Barbara Almanza & Sandra Sydnor

Abstract

The purpose of this paper was to investigate perceptions and current experiences with kegged wine (also known as wine-on-tap). Winery owners, winemakers, and other winery employees from various U.S. wine growing regions responded to an online survey.

Some wineries produce kegged wine on their own, while others use third-party kegging facilities. Eco-friendliness and wine quality preservation were considered important, yet not identified as primary motivators. Increasing sales volume and competitive advantages, on the other hand, were driving the adoption of kegged wine.

On average, the estimated sales price for a keg (5.16 Gallons) of white wine was US$ 174 and for a red wine keg US$225. Kegged wine accounted for almost 9% of the wineries’ annual production volume. Most wineries used the same brand for their kegged wine as for their bottled wine.

The findings of this study provide initial insights into experiences, reasons, and perceptions related to the adoption of a recent wine packaging innovation: kegged wine. The sample was mostly comprised of California wineries, a market where distances between wineries and third party kegging specialists are relatively short; therefore, the generalization of the results may be restricted.

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