The Wine Industry's Uneasy Relationship With 'Funflation'
Why "de-mystifying" wine, and trying to sell young people cheap plonk, doesn't work.
So I’ve been looking at what concerts are coming to Philadelphia over the next few months. Seems like a roundup of usual suspects: Tame Impala, Morgan Wallen, Bruno Mars, Waxahatchee & MJ Lenderman, Cardi B, Noah Kahan. I’m certain this is going to come across as Old Man Yells at Cloud…but have you seen concert prices lately? I mean, $230 for nosebleed seats to see Noah Kahan? I mean, “Stick Season” was great and all, but like really? I’m old enough to have sons whose friends have Tame Impala thigh tattoos, but I don’t think I’m imagining some fictional golden age when concerts tickets were more affordable.
In fact, the average concert ticket price in 2025 was $132.62. That’s up nearly 40 percent from 2021. If you’re really old, you might remember that the average concert ticket price cost $25.81 in 1996. Some might say “well, that’s inflation,” but that’s not the case. Concert tickets have risen more than 400 percent from 1980s to today, much faster than the 150 percent rise in overall consumer inflation rate.
“Funflation”—the term economists use to explain the increasing price tags of live events and experiences—is real. Yet many Americans, at least to date, are still willing to spend the money. Attendance at live concerts in stadiums—the marquee events—was up 12 percent in 2025. Nearly 40 percent of Americans say they plan to take on more debt to travel, dine out, and see live entertainment or sporting events. Nearly two out of five Gen Z and Millennial travelers have spent more than $500 on tickets alone for destination live events. According to a marketing study last summer, nearly three-quarters of consumers ages 18 to 29, and 59 percent of those ages 30 to 44, planned to go to at least one live concert in the summer months. In the same study, 86 percent of Gen Zers admitted to overspending during live events.
A few months ago, I wrote about The Economist’s “ultra-luxury-services index,” which showed that the market for “experiences” has risen by 90 percent since 2019. Per The Economist’s examples: Dinners at three-star Michelin restaurants (some rising nearly 80 percent in price since 2015), enjoying the rooftop pool at Le Bristol hotel in Paris (doubling in price since 2019), being in the audience at a New York fashion week show, tickets to the Super Bowl, Wimbledon, or the Met Gala—all of which have doubled in price in just the past few years.
In the same article, entitled “The parable of Château d’Yquem, ” The Economist noted that luxury goods, as opposed to experiences and services, started plummeting in value a couple of years ago. The article uses Château d’Yquem, the legendary Sauternes—the pricey, sweet, noble-rot wine of Bordeaux—as its example of a “luxury asset” in decline. By 2023, a bottle of Château d’Yquem had risen in price around 60 percent since the decade before. This was basically the same rise for classic cars, aged whiskeys, private jets, boats, watches, etc. In fact, a “luxury-investment index” produced by Knight Frank, showed a 70 percent increase in luxury goods from 2015 to 2023.
Then, in 2023, things started changing. The Knight Frank luxury goods index is now down six percent and further decline is predicted. The price of first-growth Bordeaux wine is down 20 percent, second-hand Rolex watches are down 30 percent, sales of fine art are in steep decline. Apparently, young consumers are not the only ones eschewing luxury goods. So are the ultra-rich, of all ages. The problem right now is that “fancy goods are everywhere,” according to The Economist:
“Lots of vineyards make great wine: is the best Bordeaux really that much better? Lab-grown diamonds are identical to the real thing. Anyone with a bit of dosh can claim a Kiton jacket from a second-hand marketplace or charter a private jet. Art-world innovators talk of “fractionalizing” old masters, with hundreds of people owning a piece of a Rembrandt. These days everyone enjoys the finer things in life—and they post about it on social media. Such things are no longer scarce or rivalrous. So they no longer seem as luxurious.”
Quite simply, “luxury” has shifted from things to experiences.
Yet, for whatever reason, an expensive ticket for a concert feels different than other experiences on a “luxury-services index.” I went to a lot of concerts as a young person in the late 1980s and early 1990s and I never thought of them as a “luxury.” I did not grow up in a wealthy town and almost every kid I knew went to concerts, which were something most could afford from our after-school or summer jobs.
In the summer of 1988, for instance, I remembering getting tickets to Monsters of Rock (with the Scorpions, Dokken, Metallica, and Van Halen) for about $25. In 1991, I saw a triple bill of Smashing Pumpkins, Pearl Jam, and the Red Hot Chili Peppers at Memorial Auditorium in Burlington, Vermont for $18.50. In 1995, I saw the last concert Jerry Garcia played with the Grateful Dead in Philadelphia, for less than $30. The first Lollpalooza in 1991 cost about $30, and the first H.O.R.D.E. festival in 1992 was about $20. To be clear, $30 in 1991 is worth about $70 today. So the rising price of concerts does not simply correlate to inflation. Seventy bucks will not get you into many top-tier concerts today.
Now, I don’t mean to sound like a grumpy old curmudgeon. I am rambling to a point here, and it does relate to wine.
The average bottle of American wine rose 11 percent in 2025, the largest jump since 2021. But the 2021 increase was driven by the Covid-era spending surge. The current price rise is happening because the industry is now losing so many customers at the lower end.
These numbers come from the Direct-to-Consumer Wine Shipping Report, published last month by Sovos ShipCompliant, a software company in the alcohol industry. This report is a bellwether because—and this is a very under-reported reality—the majority of U.S. wineries rely on direct-to-consumer sales for survival.
The average price for a bottle of wine shipped directly from U.S. wineries in 2025 was $56.78, up from $50.53 in 2024. Just think about that average price for a moment. Think about how much higher a $56.78 bottle is than a $12.99 bottle of Josh Chardonnay or $8.99 bottle of Barefoot Pink Moscato or $19.99 bottle of Santa Margherita Pinot Grigio.
And $56.78 is just the average for an entire nation with 50 wine-producing states. Average bottle prices in Napa Valley nearly touched $100 ($99.97, a nine percent increase).
But here’s the thing: average bottle prices are not rising because of inflation, or because wineries are aggressively raising prices. The average bottle price is rising simply because no one is buying the cheap wines anymore. The overall volume of wines shipped dropped by an unprecedented 15 percent, mostly at the lowest end. Even a math-addled person like me can understand that when the lowest-price wines fall away, the average price rises.
According to the DtC report, wines under $15—which accounted for the greatest volume of shipments from 2010 to 2020—declined last year by 35 percent. Over the past five years, shipments of wines under $15 have dropped by 67 percent. In fact, shipments of all wines under $40 declined nearly 20 percent.
"Contrary to the story for so many years, where people were moving from $15 wines to $30 to $60 and so forth, this is a drop-off in the lower end completely," Alex Koral, the general counsel for Sovos ShipCompliant, told the San Francisco Chronicle.
If this sounds familiar, I called out “The Myth of the So-Called Starter Wine” back in 2022. I reiterated this position in 2024 in my piece, “Sorry, California. No One Wants Your Cheap Bulk Wine Anymore.”
As I wrote in the latter:
American consumers have been telling us, for years, that they do not want what the industry is selling at $11.99. At that price, there are dozens of other beverage options.
Study after study shows that young people are drinking less but spending more. Several show that millennials already spend more on wine, per bottle, than boomers do. According to the Wine Market Council, the sweet spot for prices these days is $20 to $25—and sales in this price range are up about two percent this year. (Yes. You read that correctly.) Sauvignon Blanc is the most popular grape variety in the U.S., and its sales over $25 are up nearly seven percent. Overall, while volume is down, the amount of dollars spent on wine is up 46 percent since 2018.
But the industry remains trapped in its model of selling flashy brands that package bulk wine. As the Chronicle stated in May: “This is an industry that grew complacent, so accustomed to its baby boomer-dominant customer base and its old way of doing things that it hasn’t been forced to meaningfully innovate in a long time.”
It’s an industry that largely scoffed at natural wine, despite its popularity among younger drinkers. It’s ignored the fact that younger drinkers want fewer additives, more sustainable practices, ethical production, and transparency. California growers have even ignored the worldwide preference of white wines over red wines. California growers have planted nearly twice as many red grapes over the past decade, even though white grapes sell better. This is an industry that’s completely lost sight of the consumer.
We all know that global wine consumption is rapidly decreasing, now to its lowest level in six decades. Only 54 percent of Americans say they consume alcoholic beverages—the lowest percentage in nearly 90 years. And we know that people under age 30 are drinking less than any cohort on record.
But that doesn’t mean no one is drinking wine. There are still plenty of wine drinkers. And plenty of them are young people. When I go to wine bars, there are plenty of people under 30 drinking not-cheap glasses of wine. Millennials are now the largest wine-drinking cohort, and they spend more per bottle than every generation, including Boomers.
I have said this so many times that I feel like a broken record: The answer to the wine industry’s (mostly self-created) crisis is stop trying to convince young people to buy cheap, shitty wine. Focus on the higher end. Focus on quality. Focus on transparency, sustainability, good farming, and all the other things that younger generations say they want. Do better!
That doesn’t mean I’m not always looking out for good-value wines. I like a good liter under $20 as much as the next guy. But wines like that are now the outliers, not the norm. There is so much quality, value wine in the $25-35 range. Just accept that people are drinking less and teach them how delicious slightly more expensive wine can be. Wine people are so worried about coming across as “snobs” that they’ve lost the plot on promoting quality. This is your regular reminder: “de-mystifying” wine is a marketing strategy used by big companies to sell you plonk. Another reminder: You are not a “snob” just because you have some wine knowledge and share it.
More than anything, people in the wine industry need to focus on giving the wine drinker an experience—one they can’t get from beer, cocktails, bourbon, or whatever crap in a can they’re drinking instead of cheap wine. And, please, stop pandering to people who are simply never going to care about wine.
The music industry isn’t addressing the affordability crisis by trying to convince people to go see tribute bands or to attend open-mike nights. They’re not making dumb videos “de-mystifying” musical genres. They’re not sitting around like grumpy old men, in their moldy 1990s concert t-shirts and graying ponytails, griping about how they once saw Soundgarden in a church basement for $9. They’re leaning into giving people who like concerts the big experience, the real experience, and they’re charging them for it. And those people love it, and keep coming back for more.
Wine can bring people together, memorably, in the same way as music. The only difference is that the wine industry needs to think smaller—less but with higher quality—in order to deliver the experiences that people desire.
