Thursday, November 18, 2010

A Challenge to the Wine Industry

There are many positive factors that have parlayed wine into the adult beverage most associated with good taste, sophistication and style. Wine quality, at all price levels, has improved dramatically. The range of wine types and styles available today is complete enough to satisfy every possible consumer preference and pocketbook. Indeed one of the challenges consumers face is how to confidently drill into the overwhelming number of choices and find wines they will love.

An equally dizzying number of choices exists with wine classes, educational initiatives and the availability of wine evaluations and information. The birth and expansion of social media, blogs and on line wine communities ranging from eRobert Parker, Jancis Robinson and Snooth have provided and explosion of connectivity and the ability to share points of view. To top it all off there are new generations of wine heroes and evangelists like Gary Vaynerchuk, Joe Roberts, Jeff Lefevere, Alder Yarrow and many, many others that millions of consumers and professionals alike tune into every day. Yep, there is plenty of wine information and interaction available.

This being said I am struck by how often the same issues and obstacles to expanding wine consumption seem to arise over and over again. So let’s take a look at the progress that has been made over the past 10 years. The following quote appeared in Brand Week a decade ago and at the center of discussion in many wine industry circles as a call to action:
“The fragmented, historically insular (wine) industry generally seems resigned to accepting the wine consumer pool as is rather than aggressively pursuing new markets... the next decade could easily be referred to by future wine historians as the "years of missed opportunity.” Brand Week, May 1, 2000

10 Years After
So what does the wine landscape look like 10 years after Brand Week’s prediction that “the next decade could easily be referred to as the ‘years of missed 0pportunity’”?

“The wine industry is guilty of going out of its way to confuse the consumer, and must urgently come up with 'a new big idea', according to a British advertising heavyweight…'The wine industry is the most fragmented market I've seen. Fragmented, confusing, impenetrable.'” Sir John Hegarty, June 28, 2010, Masters of Wine International Symposium, Bordeaux, France

Hmmm. Sounds pretty familiar. What is it that keeps us stuck in this deeply etched rut carved into the path of wine enjoyment and appreciation? I am convinced that it is a combination of complacency, misinformation and stubbornness in the wine industry. It is an unwillingness to adapt and change that is preventing us from having a larger consumer base and compromising our long-term fiscal stability and health. Despite ample evidence that the wine industry would be well served by becoming more consumer-focused, simplifying our messages and improving OUR ability to communicate our mantra remains the same, “we must better educate consumers, move them up to better wine.”

This is nothing new about the wine industry mission to educate consumers and there is also nothing wrong with the idea. Ditto for the idea of moving them up to better wine. Perhaps what we really need is another strategy to run concurrently. We seem to be keeping something in place that is not working for a really large portion of the market and then we wonder why we are not making more sustainable progress in removing the overwhelm and intimidation as evidenced in every wine consumer study ever conducted.

This quote about the Project Genome consumer study taken from Wines & Vines in 2008, “With the highest percentage of consumers falling into the "Overwhelmed" category, Leslie Joseph, Constellation's vice president of consumer research affairs, commented: ‘We need to do a better job as an industry of helping these people understand what a wine's going to taste like.”

And the following is from the UK site WINEOPTIONS.COM illustrating this phenomenon is present on a global scale. “WineOption.org feels the wine trade has traditionally placed its focus on connoisseurs and wine snobs rather than the much greater number of unpretentious people who enjoy wine. Many producers, retailers and wine writers have traditionally taken much of the potential enjoyment out of wine drinking by shrouding the subject with myth, snobbery, and arcane or pretentious language. This facade has been, and in some quarters remains, a convenient means of confusing or even intimidating wine shoppers into making purchase decisions much less helpfully informed than is the case with most other foods and beverages. In fact, it is perfectly possible to provide in relatively simple day to day language the basic information which most wine drinkers need and want to select any given wine.”

I think that it is high time we look in the mirror and ask ourselves, “What are we missing that keeps a vast majority of consumers (and many of us professionals who are able to admit it) confused, mystified and intimidated?” The answer as I see it is to turn the tables and start newly educating ourselves and cleaning up a lot of the tired clich├ęs and misinformation that is disseminated under the pretense of “wine education”. I am not implying that we stop wine education per se, just that we enforce a greater rigor in the information we dispense and come up with alternative solutions for the huge market segment that is further disenfranchised by our narrow, product-based and self-serving approach. The call to action is not to change anything about the many things we are doing right as an industry, it is a call to action so we can collectively discover what we may be missing that would add immeasurably to our continued growth and success.

I love this quote: “To effectively communicate, we must realize that we are all different in the way we perceive the world and use this understanding as a guide to our communication with others.” Tony Robbins

What would it look like if the wine industry and wine communities to on the mission to understand, embrace and cultivate ALL wine consumers, not just the over-saturated segment we narrowly define as ‘worthy’? What if our next educational initiative were internal and focused on learning more about consumers and discovering more about who likes what and why? I would love to hear your thoughts on the matter!


For more info visit http://www.timhanni.com/

11 comments:

Kathy said...

Great post. I have long thought the problem was rooted in the words "wine tasting" - it implies wine somehow needs to be tasted in some special way, other than how you normally taste food or any other beverage. That thought is very intimidating. Why can't wine just be enjoyed? Do we really need to think so damned much when we drink it? Who cares if you don't get the subtle nuances. Did you enjoy it? I can't help but feel making wine less cerebral is the ticket to broader wine consumption.

Mary Rocca said...

I could not agree with you more!

I think we have been trying to tell the consumer what they should like- rather than letting them tell us what they like. Let the consumer choose what flavor profile they like... and not judge them for it.

I don't think there is anything wrong with education about wine, but let's let people know that if they like a given wine, then it's a great wine for them!

Claudia R said...

Fantastic article Tim. The wine industry needs to better serve the end consumer but so much effort is placed on pleasing the wholesalers and customer/trade for reasons we all know. The wine industry also needs to give more attention to ethnic consumers. While at Beringer some years back, I introduced the first bilingual labeled wine in the US targeting the Hispanic consumer. I had to overcome some internal resistance but fortunately the trade eagerly supported the concept and the test run was a success in L.A., AZ and TX, the three markets targeted. Ethnic wine consumers exist and they are underserved. What a terrific opportunity for those wineries/suppliers who intelligently engage these consumers.

tercero wines said...

Tim,

Kudos for a an absolutely wonderful - and spot on - blog post. I could not agree more - the main obstacle to more people trying and enjoying wines in the US is the US Wine Industry itself!

I still remember you coming to speak to our Viticulture and Enology class at UC Davis and your discussion about White Zinfandel. You challenged the students to go to a great steak house, ask the sommelier over, and ask for their best bottle of white zinfandel. After the laughter died down, you noted that you understand why the class was laughing BUT mentioned that two things should be taken into account:

1) White Zin continues to be one of the best selling wines in the US, despite the fact that many 'better' drinker look down upon it.

2) Who are you or I or anyone else to tell someone they are wrong for wanting that particular wine at a steakhouse? Where is this rule written in stone?!?!?

You would not believe how many of my classmates came up to me that night and the next day laughing and saying, 'I would NEVER order a white zin at a steakhouse."

They obviously missed the point, as does most of the industry to this day. Why must the industry be 'pompous' and mysterious? Why do we 'create rules' to drink by? Why do we use closures that intimidate people? Why can't wine be looked upon as it is in Europe, a staple on the table to be consumed with dinner - NOT a trophy or a status symbol?!?!?

Keep fighting the good fight, my friend, and please know that there are others out there who will stand upon the soap box with you!

Cheers!

Larry Schaffer
tercero wines
www.tercerowines.com

Anonymous said...

I work tasting nights at a local wine shop and suggested that we make a few changes to our tastings.
- most everyone talks about our wines as (#2 or #4) as that is the order they tasted it but not necessarily the order listed on the sales sheet.
-as many of the wines are French, most of our customers cannot pronounce or learn the name of the wine.
-most customers do not know that a burgundy is a pinot for future reference when buying.

I suggested using placards to identify the wine by its correct name, what varietal it is and its US equivalent is.

the answer i got to this suggestion, "so you want us to dumb down our tastings."

NO, I think we should educate our customers so that they are more informed and want to come back to BUY more wine.

I guess that is not the goal of this particular wine shop.

Jeff V. said...

In the famous words of Barney Stinson: "Challenge Accepted!"

1WineDude said...

Intriguing stuff as always! And thanks for the kind words!

Nick said...

What makes you think what we're doing now is not working? The stats suggest:
-younger generations are taking to wine faster than prior generations.

-wine consumption is increasing year over year

-wine is more available today than ever before, in more locations both retail and on-premise

-wine value (price/quality ratio) is improving year after year

-large-scale internet communities foster active discussions and are very often welcoming to those of all levels

-research continually supports wine being good for health

Sure there are some areas for improvement (when is this ever not the case?) but the facts suggest that Wine capital W is thriving.

As for the whole problem of catering to wine fetishists, it's a little like movies or music--there will always be those who are too far "inside" to see the bigger picture. In wine, however, 85% of the wine is consumed by about 20% of the US adult population. People simply follow the money and try to give it what it wants.

A productive question might be: why do people choose to drink less wine? And do any of the answers suggest growth opportunities.

I have my own answers to this. One of them is that restaurant wine pricing is simply not sane and deters new drinkers from experimenting.

Tim Hanni MW said...

Hi Nick,

Thanks for jumping in and you are right on with your assertions. I think that I acknowledged many of your comments in the first paragraph of my post and agree with most of the stats you provided.

To answer your question, "What makes you think what we're doing now is not working?"

The quotes I selected articulate the scope of the problem and what is not working: 'The wine industry is the most fragmented market I've seen. Fragmented, confusing, impenetrable.'

We have found, through formal research, that there is a highly disenfranchised part of the market and we keep making the same mistakes, over and over, that keep theses consumers disengaged and migrating to other beverages when they would actually prefer wine.

Part of what is not working is wine training and education programs that end up instilling intimidation, confusion and result in the disengagement of these people. Again I have conducted research in this area and the results of many wine training initiatives work very counter to the intentions of selling more wine!

The challenge is to find new ways to understand, include and engage this very, very large population of wine disenfranchised consumers and reap even more benfits!

Tim Hanni MW said...

Nick - sorry, forgot to add this:

"In wine, however, 85% of the wine is consumed by about 20% of the US adult population."
- This is the opportunity at hand! What if we could significantly move the dial on these figures?

"A productive question might be: why do people choose to drink less wine? And do any of the answers suggest growth opportunities."
- This is precisely what I have been studying for many years. We have identified major factors that explain why many people choose to drink less wine, EVEN WHEN WINE IS THEIR BEVERAGE OF CHOICE! The information is available in our free report summary available at www.timhanni.com. The CHALLENGE is to take action to the question you pose above - and our findings demonstrate we need to revise a lot of misinformation, learn to newly engage with consumers and rebuild trust in a market segment that we have been belittling.

Charmion said...

I sell wine. Retail, big store employee. Used to sell wholesale in the San Francisco area. Relatively sophisticated consumers. I think that the common practice of having little or no information on the labels is the biggest obstacle to getting more people into wine. Labels are so full of confusing, non-informative crap. Cute logos and rolling script that you can't read and endless new anonymous labels that last 2-3 years and then die. How about something easy to read, with the truth about who you are, what grapes you put in the bottle, and whether the wine has residual sugar and how much oak. I see a new wave of negociant labels from Kendall Jackson and Gallo, in the $10 to $15 price range, but all they do is take up space on the shelf without even putting some basic information on the label. Or worse, a goofy story that says nothing. And if Gallo wants to shed its' old image, and wants to be in the hunt at anything over $10, then don't treat the consumer like an idiot. People know how to read. They read labels on other products. They read Consumer Reports and the WSJ and NY Time reviews, and the wine magazines. Why not print a simple, readable label that tells the prospective novice what is actually in the bottle for which you want him or her to pay $10? Do you feel safe and secure paying money for something with no content information and then eating or drinking that product and paying good money for it? What is the use of calling your product Promiscuous, or Purple Cowboy, or Double Decker, in a wine bottle? What does that say to the American consumer? You have the attention span of a gnat and are easily swayed by cute colors? Nuff said.