I just got home from a wine business seminar at COPIA. It was a general overview of the industry trends, what's hot/what's not, off-premise/on-premise focus, and general industry numbers. I never thought data would interest me, but I guess it helps that the data is about something I love!
NOTE: The next part is commentary on the wine business. It'll be very worky.
Guess what one heavily covered topic was? Yep - Millenials. Almost exactly one year since I started in the wine biz, this trend of younger consumers (born 1977 - 1994) with disposable income is leading the charge in wine consumption both in dollars and in units. You would think, given this information, that there would be more wines targeted to these consumers, myself being one of them. Speaking as a consumer, there is a lack of focus in the target price point - $10-15, with wines from all over the world and wines that are a single SKU. I love trying new things, but the quality has to pull me back as a loyal-ish customer, not just the price or name.
I'm thinking I should start a winery where the focus is Pinot Grigio, Pinot Noir, Riesling, and Cab. I would make a KILLING. These varietals are hot, and they are varietals that, Cab probably being the exception here, can play to the more adventurous wine drinker, the typical millenial. They can have interesting labels, fun stories, viral marketing, entertaining yet educational blogs, and engaging websites. Anyone want to play venture capitalist for me?
As much as it seems like the market is ridiculously saturated with wine (just walk into any Safeway), there are huge holes that are just begging to be filled with wines in that price point in those varietals. The big wineries capture the majority of the market in the $1-$9 segment, and the small wineries easily capture some of the $20-$100 market. Where does that leave the millenials, the folks looking for those $10-$15 wines, the ones who are adventurous and curious and willing to try new things? This powerful group of 21-30 years olds use the internet to research everything, including wine. They trust the word of mouth recommendations from their friends, funny and informative guys like Gary Vaynerchuk from Wine TV, wine blogs, and tastings. They have yet to be fully tapped as a wine consuming group, and we in the wine biz need to start cashing in on their curiosity to try new wines and eagerness to learn.
Coming from the tech world into the wine world, I knew I'd have to make adjustments. This industry is not on any cutting edge, and trying to force this industry into thinking in a new way, into considering the web as a viable place to do business or even just to reach consumers, will not happen overnight. It probably won't happen until the bubble has burst. I am hoping that this data on millenials and hot varietals, both qualitative and quantitative, will seep into the presentations to winery CEOs, retailers, and restaurants, and will creep into the vocabulary of sale forces and wine biz leaders. Just these two things - just two things! - can change the marketplace, the profitability and the direction of established wineries.
Hope that all made a little sense. Word to the millenials.
Out of curiosity - what do you buy? Are you loyal or adventurous?
Cheers to the wine biz - may it live long and prosper!
PS (you know how much I love these) - One of my New Year's resolutions, besides losing weight of course, is to try new wines. I'm sure Napa has a group of tasters but since I have yet to meet anyone, it's time for me to taste and taste, see what's out there, live up to my generation's stereotype. Bring it on.