Hey Wineries! Time to take advantage of HOW people drink and buy wine
The winds of the wine industry are stirring. How, and what people are drinking wine is changing. Where they are drinking is changing. Who exactly is drinking that wine is changing. We work hard to make sure that wineries are on the right end of all those trends, making sure that they are on the up, growing their business, and engaging their consumers. So its important for you to know what they are and what to do with them. Well, we are here to help and boil it down for you.
Consumers are drinking more OFF PREMISE
Off premise wine sales are growing. Why? Drinking wine ON premise (restaurants, bars, etc.) is just too damn expensive. Think about it for a hot second. Glasses of wine at a bar START at $10 per glass and rise to almost $20. Three drinks in and your tab is already $60, and thats yours alone. God forbid you bought a round. The same wine at a Trader Joes could be $12 or $15 for the bottle. Hey, we recently got charged nearly $300 for a Bordeaux at a restaurant that retails for $45. Consumers are catching on, and not wanting to pay those markups anymore.
But brick and mortar sales are not growing that fast
Liquor store sales are not growing as fast as we would have hoped given the general trend in sales. Retail sales have grown just 5% per year since 2013, which is not bad, but also not great.
Which means consumers are buying more FROM YOU!!!
Or at least they want to buy more wine from you, the winery. Direct to consumer (D2C) sales have increased 18.5% between 2015 to 2016 (which you can read more about in this article from Forbes). Though they still only make up 4% of total wine sales in the US, that still accounts for $2.3 billion annually, and those sales are dominated by SMALL wineries (less than 50,000 cases a year). This is the perfect route for small wineries to play against the big boys.
Or are they? What about wine clubs?
Though nothing new the internet has made wine clubs increasingly accessible, even more so with social media. There seem to be an endless amount of wine clubs popping up every day, each with its own deft spin on what is essentially the same thing. Pay us every month, we will send wine to you. You don't have to do anything about it, and will probably forget it, then we will make it tedious for you to unsubscribe while increasing the amount of bottles required for free shipping. Sound familiar? Even Martha Stewart has a wine club, while Blue Apron is now offering a wine service to pair with their meals. 90% of wineries in the US have a subscription model, so you have to ask yourself if what you are offering is really unique, and how easily can it be replaced by another service.
So what to do?
Relationships matter. Building relationships with the people who drink your wine is far more important today than it ever has been. Consumers want to feel special, they want to feel appreciated. Gimmicks don't cut it. You have to be attentive, and in 2017 you have more tools are your disposal than ever.
We could all take a lesson from the beer industry here (sacrilege I know), in particular Goose Island.
Wineries the world over should take note, though they should change "best" to "favorite". You want people to come back because they choose to, not because they are bound by a recurring transaction on their credit card. You need to build a relationship. There are better wines, but you have to be one of those wines that brings someone an intrinsic value that they cannot find anywhere else.
The key is figuring out what you are to them. Where do you fit in with their life? What does your product, at the price point you have it, do for the? Is it a go-to wine for the weekend? Is it a wine they want to chill out with guilt free on a Tuesday after work? Is it a wine they are saving for a special occasion, be that in the near future or the distant? This is important to ask because you start to realize that your brand has a bigger meaning. You become more like a trusted friend, and everything you do should be about solidifying that connection. We can go into more about different wines for different occasions, but that is a conversation for another time.
How people drink wine in 2017 and beyond is very different to how we drank wine in the past, and it is going to continue to evolve as generations grow and change. Wine is loved by all, but tastes and styles dictate what people drink and when. In order to take full advantage of this, wineries need to evolve how they talk to the consumer, and figure out where wine fits into the consumer's life. It is no longer acceptable to dictate, you have to build a relationship that is a two way street. Let people fall in love with your wine, and then show them love in return.