Millennials in the Wine Marketplace
At 2018 ABID Conference, Holly Higuera Talks About the Importance of How & Why Millennials Have Emerged Today's Wine Marketplace.
Millennials now represent 25% of the total U.S. population and nearly one-third of the total wine-buying population. As a result, says Holly Higuera, General Manager of Through the Grapevine Imports, it’s important for anyone involved in the wine industry to understand how and why Millennials have emerged as such a force in today’s wine marketplace. At the ABID Conference in New York, Higuera first described the wine buying habits of Millennials, and then went into detail on how to target and sell to them.
The wine buying habits of Millennials
Millennials refer to anyone born between the 1980’s and late 1990’s. They now represent one-quarter of the population and have now edged out Baby Boomers as the most important segment of the wine marketplace. In fact, in terms of wine cases consumed, Millennials now account for 42% of all cases consumed, compared to just 30% for Baby Boomers. In short, explains Higuera, “Millennials are consuming the most cases of wine.” If you haven’t started to market specifically to them, it’s time to start.
What is most striking about Millennials is that they are far more likely to buy a premium bottle of wine (defined as a bottle of wine costing more than $20) than are Baby Boomers. In one survey of wine buying habits, only 5% of Baby Boomers said they had purchased a bottle of wine over $20 in the past month, compared to 17% of Millennials.
However, when Millennials do spend $20 for a bottle of wine, they are looking for an authentic story about the wine and something they can share with their friends on social media. One example that Higuera gives is the young female Millennial buyer who decides to buy a bottle of Moldovan Rosé as an impulse buy after finding out that the producer of the wine is a woman. And, in fact, two-thirds of Millennial wine buyers are women.
It’s important that any story is authentic, however. Unlike the pre-packaged national marketing campaigns that target Baby Boomer wine drinkers, it’s important to offer something authentic that will connect with young Millennials. One great example, says Higuera, is the new trend of biodynamic wines. This connects with the organic trend – at the same time as these Millennials are shopping for organic food in a supermarket, they expect to find a reasonably priced biodynamic wine.
And when Millennials do buy a $20 bottle of wine, they tend to post about it on social media. The reason they do this is simple: they want to become part of the story around your wine. Sometimes they identify with the winemaker or the type of wines they are producing and would like to share that with their friends. And sometimes they simply want to gain credibility with their followers by “discovering” a wine (or wine category) before anyone else.
The best part about this storytelling on social media, of course, is that Millennials are doing your advertising and marketing for you. Every time they share a post on Facebook or Instagram, they are getting the word out about your wine.
Right now, says Higuera, Facebook is the platform of choice for young Millennials. However, Instagram and Snapchat are gaining in popularity, and it’s important to consider all the social platforms – including Twitter and YouTube – in order to reach precisely the right target audience.
Selling to Millennial wine drinkers
So what can you do once you decide to launch a marketing campaign for Millennials? The first step is always building the story. This story might be about the wine, the producer, or even the importer. What makes the wine different or unique? And the “hook” to attract users can even be something that is only partly related to the wine. One example that Higuera gives is the vineyard owner who posts photos of bunnies on his estate. Amongst wine drinkers, those photos of bunnies have become a cult favorite.
Then, it’s just a matter of how you can package that story. You need to think in terms of distribution channels, and that usually means Facebook or Instagram. The great news here is that you don’t necessarily need a large following in order to be successful with this strategy. In fact, says Higuera, it can actually help you if you only have a small number of followers – this helps to create the perception that a wine drinker is “discovering” your wine and that he or she is the “first to know” about your great wine or vineyard.
So what about brand loyalty? That’s a question that Higuera addresses, noting that Millennials have a reputation for being fickle and not loyal to any one brand. Unlike Baby Boomers, who might go to a wine store and buy 3 bottles of the same wine from the same producer, a Millennial will likely choose 3 different bottles from 3 different producers. They are much more open to the idea of sampling different experiences. However, the important point here is that once you have established an “authentic story” around your wine, Millennials will not leave you. Quite the opposite – they will become brand evangelists and supporters.
One other point to keep in mind, says Higuera, is packaging. Gone are the days when you could simply put a photo of a chateau on a label. Instead, Millennial wine drinkers want to pick up your bottle and read a story on the label. And they are much more open to the idea of unique and unconventional images on the label. Higuera gives the example of one winemaker who is putting an image of a moose in a bathtub in order to highlight the type of unique, creative wines they are making.
Millennials are now the most important demographic
If you are serious about selling more wine, says Higuera, you have to consider how to market to Millennial wine drinkers. Not only are they buying more wine than any other demographic, they are far more likely to buy a premium bottle of wine and then share stories and images about that wine with their friends on social media.
And, since it is very easy to target digital ads to these users on social media, you can hyper-target by grape varietal, wine region, or geographic location. If you are trying to sell biodynamic Italian wines to young, affluent Millennial wine drinkers in the Washington, DC area, it’s possible to roll out a custom marketing campaign for exactly that segment of the market. In short, marketing to Millennials with authentic stories about your wines is the easiest way to grow your wine sales.
Overall, the two-day ABID Conference in New York City provided a detailed, comprehensive, and eye-opening approach to the U.S. import and distribution business. Participants walked away with real, actionable steps on how to grow their business and optimize its future profitability.