Bra-Burning Feminists Drive Wine Sales

The business world moves in cycles, and if you live long enough you start to see them repeat. Today the popular press is replete with articles hyping the Urban Millennial Myth.

Its the older tradition-loving Boomers who have become accustomed to Madison Avenue solving every need, want and desire - versus the edgy up-and-coming Next Generation. The Next-Gen is nothing like you've seen before and you need to get current with your marketing or you will end up on the losing end of the stick.... or so many would have you believe ... except its really a repeat of a cycle we've seen before and we can see the outcome.

Cycles & Susan B. Anthony

Boomers today drive wine sales and its the women Boomers who are the primary wine buyers according to many studies. Those were the the same bra-burning feminists that were labeled as radicals back in the 1960's and early 1970's when they were Millennials. They were nothing like we've ever seen before either .... well .... there was Susan B. Anthony in a prior cycle but that's another story.

If you decided to craft a label to attract Millennials today, what would that look like? The press tells us Millennials are adventuresome, irreverent and demand transparency, sustainability and authenticity. What about their desired product attributes in a wine purchase? What do they want?

An article that came out last week says Millennials are looking for non-pretentious products, non-traditional packaging, simple wines at an affordable price that speak to them; each are reported solutions for cracking the Millennial Code and developing a successful wine marketing program to that untapped pot of gold at the end of the cohort marketing rainbow.

Rima Fakih (Photo courtesy of Miss Michigan USA)

A restaurateur who targets Millennials, answers the question within the article noted above by talking about how he decided to create wine lists that ...

"...flout the bureaucratic rules that dictate how wine should be made. It’s an eclectic, slightly subversive list with a decidedly anti-authoritarian bent."

The description of Millennials and what they like sound eerily familiar ... non-traditional packaging, simple wines at an affordable price.... transparency, authenticity, adventure, irreverent behavior.....

Boom-illenials

Back to cycles - there was a day when the Boomers weren't traditionalists either. In the 1960's we Boomers wanted transparency... except we called it Government lies. We wanted authenticity ... except we called it "getting real." We leaned toward being irreverent, and were called radicals. We were part of the Occupy Movement  ... except we called the event a "sit-in." And we also drank wine - mostly inexpensive sweet wines; Blue Nun, Reunite (on ice ...), Grey Riesling, Mateus, Lancers, Rhineskeller, Paul Mason wine in carafe's, etc.

Those brands were the wine companies solutions for marketing to the Boomers in that era .... wines from non-traditional regions and presented in non-traditional packages, emphasizing fun, adventure, and sex appeal. We were really anti-authoritarian, sustainably-green. Heck, we even recycled the Lancers bottles as candle holders! Millennial current day likes and dislikes are very similar to what came before them so there is a road map and we are seeing the same thing happening with the growth in Rieslings as an example, and the multitude of packaging.

Radical Feminism and Wine

 

Maybe Susan B Anthony didn't let liquor touch her lips, but Boomer women have been found in several studies to let a lot of wine touch their lips, and and one can argue women Boomers are the most important wine cohort today. In one study, The Wine Market Council recently estimated 53% of people who drink wine more than once a week are women. Maybe someone should have marketed to them back in the 60's? Radical feminists as they were called in the 1960's, brought attention to their second-class plight by casting their makeup, high heels, girdles and bras into trash cans labeled "Freedom Trash Can" at the 1968 Miss America Pageant.  In a decidedly anti-authoritarian manner, everything was tossed into the can and it was set afire.  

Gloria Steinem is one of the best known feminists. She was at the epicenter of women who were burning their bras at the Miss America Pageant and working for positive change for women in our culture. Where did she end up? She's spent her life trying to advance the cause of women, but she's mellowed and become less radical and more traditional  today. When she was recently asked to opine on Miley Cyrus vulgar dance (!generation gap alert!) at the VMA awards, this was her response:  

Gloria Steinem

".... given the game as it exists, women make decisions. For instance, the Miss America contest is in all of its states ... the single greatest source of scholarship money for women in the United States. If a contest based only on appearance was the single greatest source of scholarship money for men, we would be saying, "This is why China wins." You know? It’s ridiculous. But that’s the way the culture is. I think that we need to change the culture, not blame the people that are playing the only game that exists." (highlighted for emphasis)

Wow! That's a huge evolution for Gloria Steinem. Not only did she not condemn the Miss America Pageant, she applauded the contestants for doing what they could do. Apparently, even the most radical among us will evolve over time.  

Should I Market To Millennials Now?

Looking at how Gloria Steinem has evolved, do you think a brand created for her in the 1960's would still be effective today? I've heard the argument from many that its important to market wine to Millennials now, so they will be the next generation of wine drinkers. If you make $10-$20 wines as a mainstay, then by all means - market to Millennials because they might buy your wine today. But if you are making wines that are $20+ wines, then you are wasting your scarce marketing dollars.

All that said, if we want to have Millennials learn to love American wines when they are in their thirties, that is an American Wine Industry issue. No question in my mind that the younger generation has access to and is drinking better foreign wine than the Boomers at a similar point in life. That should be a concern to the US wine industry and we should be looking at putting a Wine Marketing Order in place.

Take a clue from history. Were you to make a wine that appealed to the 60's Bra-Burning Radical Boomer Feminists when they were in their early 20's .... brands like Blue Nun, Grey Riesling, Mateus, Lancers, Rhineskeller, Reunite, Paul Mason wine in carafe's, etc. .... your branding would have been wasted just like those brands have wasted away to being gone or almost gone. The women who consumed those wines back then today really don't drink those wines.  In the same way, there is little chance that the Millennial will develop loyalty to your brand that hits all their wants and desires now, and who stays with your brand forever because you were first to their party. Why? Because their tastes will change and when they have the money to make impactful purchases of your $20+ wine, they will be off to something else. History will repeat itself.

 

Millennials Are Last in Wine Spending

 

In the article I mentioned above, we sadly find the seemingly requisite and misleading stats that overstate the Millennials importance in current wine consumption, contributing to the growing urban myth by saying,   

"...about 39 million U.S. adults drink wine several times a week. Millennials make up 29 percent of that group, while 39 percent are baby boomers." A quick read of that might lead one to believe Millennials are #2 in spending and right on the heels of Boomers. But if any cohort is on the heels of Boomers, its the ignored Gen X cohort, and it really doesn't matter which price point we're discussing as you can see in the chart above. Millennials are last in terms of spending on wine. I discussed the Millennial myth in greater detail a couple weeks back in the post Millennials Aren't All That.       

Urban Myths and Women

I challenge anyone to find a reliable statistic that shows Millennials are spending more on wine than Boomers or Gen X'ers today. If you believe that to be true, then you've been sucked in by the Urban Myth of Millennials..... just like the myth of women burning their bra's in the 1968 Miss America Pageant. True story .... that never happened either. Nobody burned their bras at the Pageant and it was rare that anyone ever did. Its just another urban myth that keeps getting repeated over and over again until it starts being true, exactly like the Millennial Myth that is advanced into urban legend by self serving reports and reporters. The reality is that what you read in the press (and stupid blogs for that matter) ... what's written isn't always true. Deciphering the truth can at times be perplexing, but from every angle available - what is clear to me is Millennials will evolve just like the Boomer women evolved, moving from gimmick wines and unique packaging, to more structured wines, and then to fine wine. Of course that's a generalization and you can just as easily argue not all will evolve that way and I would agree. For now though, Millennials shouldn't be the targets of most family winery marketing programs today. Gen X should be your growth engine and Boomers should be your "cash cow."

The Feminism Movement made enormous strides for women's rights but with wine, there is more work to be done. In an article three years ago, a Master Sommelier pointed out 80% of the time a male/female couple sits at a table together, its still the man who is given the wine list and expected to make the decision. I'm thinking women deserve an equal chance to grab the list and suggest the practice of putting the list in the middle of the table makes the most sense.

And finally to Gloria Steinem, turns out she is a Boomer and a wine lover - go figure. If you are interested, and are planning on being in New York on December 23rd, you can see her at the City Winery with the musical group BETTY and ask her what she thinks.  

What are your thoughts? Please log-in and offer your comments for the community and if you think the read is worth passing along on your favorite social media platform, I'd appreciate it!

What's the Surest Way To Fail in Business?

This is my 50th post and I'm celebrating by taking a vacation and  am writing this morning from my hotel balcony on Waikiki. That was an unabashed I'm-having-more-fun-than-you comment..... and I'm clearly warped to be writing on vacation.... Anyway...

Going through graduate school I took a class in Organization Behavior. I liked the class because it was high-level and covered a number of important theories, and yet - the title of the course always bothered me. It seems like such a non sequitur. It's as if an organization has feelings or predictive behavior, and of course it doesn't. Organizations and wine producers for that matter are made of people with feelings, perspectives, insecurities, and values. While marketing, sales, production, viticulture, and administration are all important parts of running any wine company, in the end without an established business culture used as a touchstone for behavior and decision-making, the other disciplines will struggle or even fail no matter how awesome the product or strategy. Leaving a company's values unclear or believing everyone just knows what you stand for without talking about it is the surest way to fail.

The Question of Cultures

I was reminded of this on a trip to Hawaii yesterday. We got on a plane out of Oakland for a 5 hour trip to Honolulu Hawaii in coach. Its always a long flight but I try and sleep so I get there quicker. That's a trick I learned as a kid when we drove to Disneyland from Concord. CA. Sleeping wasn't an option this time because there were a group of six Persians in front of us with a beautiful young 5 year old boy. It was a party from the moment we took off. There was laughing, jumping and dancing in the isles, the beautiful child yelling at the top of his lungs participating in his family dynamics. They were going to Hawaii and they were HAPPY and didn't seem to mind if others around them wanted to sleep. The young boy was doing nothing more than participating in his family culture. He was emulating his family.

Then next to me there was a 25 year old graduate of San Jose State from Mumbai. She was second generation and it was her first trip to Hawaii and her longest plane flight ever... really nice girl. Her family of 8 people were all going out on a Norwegian cruise around the Islands. They too were happy and the parents were talking loudly behind us and unconsciously kicking our seats through the trip for some reason. The older folks got together in the isles and were laughing and dancing.... they seemed focused on themselves and didn't seem to mind if others around them were trying to sleep. When the plane stopped, they started to push their way through the isles past people trying to get up. I don't know if it was an cultural behavior or not, but they missed the rule most of us learned in Plane Flight 101 that you wait until the people in front of you get out of their seats before you do.

Some people would take that description as a flight from hell. While it sure wasn't the best, you deal with what is on your plate. You get what you get and you don't pitch a fit. For all I know, to others around me I might be thought of as rude for trying to sleep? Maybe I should have joined in their dance and forgot about sleep. Instead I turned to the drug of choice on flights to Hawaii: Mai Tai's. Everything seemed to be better and in my slightly inebriated state got me thinking about corporate cultures and values.

In this case, we had distinctive and separate cultures on our part of the plane all operating independently. Thank god we didn't have to operate in some sort of a team to get to some common goal, because there was a lack of commonality. How would we make decisions .... even the simplest like should we use the First Class bathroom if the other ones are full?

Organizational Behavior and Hospitality

How does that relate to wineries? We have become an international business. People come from far and near with wide ranging cultural norms and biases. We are their hosts and have to be ready to help them have a memorable time. Its our opportunity to help them leave with a brand positive perspective on your winery, and our Country. You can't judge their behavior by our standards but should be encouraged to understand the cultures of your guests and be long-suffering if needed.

Second and more important, the USA is an immigrant country and is made of diverse families with different norms and beliefs. To be successful in business, we have to establish our own work culture that emphasizes hospitality as a base value.

Some of My Culture Beliefs and Examples

At Silicon Valley Bank I'm very proud of our culture. Its one where everyone tries to do the right thing. Profitability is important, but not as much as our values. Profitability I argue follows BECAUSE of our values. Everyone's viewpoint is appreciated and we've developed accepted ways to behave and make decisions. Debate-decide-deliver. We talk about "the shadow of the leader;" a concept that means leaders of organizations can't take a "do what I say, and not what I do" model or take credit for the success of others in our team. We believe in recognizing others success and that we are not in competition internally. Its not a net-sum-zero game. There is much more to our Bank's culture and we are constantly talking about it and reviewing the fit.

On my specific lending team of 5 people, we have several rules that we adhere to that make behavior more palatable. I believe feedback is an everyday thing and that's what we do: give feedback on the fly when there is teachable moment. We believe that mistakes are tuition and that pretending mistakes don't happen stops continuous improvement on the team and waste that tuition. We are fine with making mistakes. They happen and don't show up in reviews in any material way because they were already covered. Reviews in fact are kept as low-key as possible because they are an administrative thing, not a tool for improvement. They are never motivating (Don't tell HR I said that please).

We believe that we need to be direct and respectful in the way we communicate with each other. That means we hold each other accountable for our failings and speak our mind instead of supporting some circular gossiping sophomoric culture. We support each other in what we do, and support our clients efforts. There is always someone on staff for our clients to reach. I believe I am responsible to my staff and each year ask in a safe manner, what things I need to do to improve and what they like. We believe we are in the hospitality business and our clients and their employees are our guests when they come to our offices.

All of those rules establish a culture within the Bank that is good for decision-making, respects individual beliefs and values, insists on team play, rewards success, inspires evolution and new approaches of doing things, and makes for one great place to work. Given time, the plane of people on my trip to Hawaii could come together develop mutual respect and trust if we started first with addressing The Surest Way to Fail in Business and developed shared values. Our Bank and team are great places to work.

What about you? What are the rules that your company lives by? What are the values that are not negotiable? How are you reinforcing your culture? How do you measure your culture and success in achieving change? What thoughts and experiences can you share with the community about your learnings in building healthy and successful cultures in business.

Please log in and participate in the discussion. Oh ...... by the way, as you can see in the first picture, I made it to Hawaii! Aloha!

Are You Adjusting Your Marketing To Boomers?

Never Bet Against A Dog That Tells You They Can't Play Pool 

 

"If you aren't starting to make some adjustments in your current marketing strategy to Boomers, you will lose your most important current wine buyers sooner than you think, and another winery will pick that consumer up who will adapt to their changing preferences."

 

 

 

My mother plays pool, has an occasional nip, likes pink and is a dog. She's actually a wonderful person, but I've been trying to break her from nipping for years. Now it seems the years themselves are actually slowing down her nipping, which isn't good for the wine industry when considering her in terms of her Mature Cohort. A non-nipper wouldn't be the person a winery should try and attract. (Don't play pool with her either.) 

My mom can nurse a large bottle of moscato for a month. Obviously if she is representative of her generation, when it comes to developing a strategy to attack the geriatric set there are probably better places to invest your precious resources. But if you listen to many in the wine press, they will say its the Millennials. I believe if you sell fine wine and that's what you are going to do, I suggest you would be better off investing in my mom's cohort today because they can at least afford your wine, if you can convince them to buy it.

Millennial Myths

We've been writing for years on the Millennial Myths, the most prevalent one being Millennials are driving fine wine sales. That's absolutely false. They aren't driving sales and there shouldn't even be a debate. I found -this article- from 2009 which is a good example of the kind of confusion that's been layered onto the discussion. Take for instance this quote:

"the U.S. ranks third in total wine consumption, and is gaining rapidly on the leaders. Much of the (3.3% ~ 850,000 case) increase can be attributed to the Millennial generation"

Market Share of Wine Sales Sorted by Cohort

It wasn't true in 2009 and isn't true today. What is true is the Millennials have the highest growth rate, but like all segments with low numbers of consumers, the high growth is because of the small base versus the growth in the nominal consumption of the segment. 

The chart directly above is one I used for a speech in Sonoma in May. It's from a survey we do of West Coast Wineries and shows that Millennials represent less than 15% of total wine sales. That's pretty consistent with Nielsen information as well.

Don't Market to People Who Can't Afford Your Product

The way I make practical sense out of the avalanche of miss-communication and demographic-goguery, is to break it down into component parts. Buyers of anything have to have the willingness and the capacity to buy. For example, my 20 year old Millennial daughter wants a new Range Rover - she has the willingness. But as a sophomore away at college, she doesn't have the capacity in her budget. I've heard some people argue that you need to market your wine to the Millennials now because they are the future. In the same breath, I've seen market research on Millennials where they feel they aren't being catered to because they want less expensive and better wines. The truth is DOMESTIC wine should be marketed to Millennials as a category, but its the lower priced wines that attract those consumers today. For now though, lets just stipulate to the belief the Millennials have a greater willingness to drink wine than any previous generation ( .... its not a proven fact either because the data aren't available from previous generations, but lets just go with it.) Do Millennials have the capacity or disposable income to buy fine wine?

I looked to the most recent information provided by the U.S. Census Bureau on both wealth and income levels. The data reveal that the older boomers have the most wealth followed closely by the Matures, with Millennials having amassed only about 2 percent of the Boomer wealth still early in their careers. 

I also reviewed the top 20 percent of all wage earners sorted by age. Again its the Boomers leading the pack as the highest paid, followed by the Gen-Xers, the still working Greatest Generation, and last again are the Millennials. So if it was only the capacity to buy, that information might suggest a winery should have a plan to go after the geriatric set since they have the capacity. The problem is, the older generation doesn't have the willingness - or maybe the kidneys to be a dominant cohort in wine sales. Back to the question, where do you invest your precious marketing budget?

Boston Consulting Group Matrix

The answer isn't binary. Your marketing budget needs to be spread out a bit but focused largely between high growth segments, and those segments where you have a high market share. 

The basics of the now legendary Boston Consulting Group's Growth Share Matrix is pictured to the left.  My mother the dog as the chart shows, falls into a segment in the lower right quadrant that has a low market share and low growth rate. In the BCG Model, she is termed a dog and that is the cohort you want to put little if any of your marketing resources. The above chart on Market Share shows the Mature Cohort has a 14% share of fine wine sales now. That's about the same as the Millennials, but you should be investing more in the Millennial Generation versus the Matures because Millennials do have growth upside while Matures will be turning up daisies making them ineligible for wine purchases relative to Millennials. Plainly, there is no growth opportunity with my mom's generation.

Between the remaining cohorts - the Boomers and Gen X, where should you invest more of your attention and marketing dollars today? The Boomers are far larger than Gen X and they have more capacity to buy, but you really should be investing a fair amount of your time and effort now attracting new Gen X consumers instead of new Boomers. Gen X are - or should be, the current stars of the portfolio looking at the matrix. They are the consumers that are going to drive your sales growth higher as the Boomers kidneys hit retirement age.

It's True: My Mom Gave Birth to a Cow

To keep it fair, while my mom might be a dog, as a median aged Boomer, I am a cow; a "cash cow" to utilize the BCG model. I may not be able to beat my "Dog" mother in a game of pool, but I can swim better than her. I just need a little help lifting all that dead weight out of the pool these days. 

Anyways ...fine wine producers have to be relevant to Boomers because they have the highest market share in wine purchases still, and they will for some time yet. You need to "milk" the Boomers by spending less vigerously versus Gen X. You need to utilize this cohort to fund investments in product development and marketing to other growth cohorts. But if there is something you can do with the Boomers today in terms of investment, its looking for product changes that might elongate the length of time they remain your wine buyer. That is a very important consideration and worth contemplation and further investment. That will return a solid current ROI.

Why Will Boomers (and Matures) Slow in Wine Spending?

You may think that you are doing the right things to market to Boomers today - just like you always have, but that's no guarantee of their future behavior relative to your wine and purchase preferences. The Boomers are evolving and without adaptation of your brand strategy, you might find them growing away from you before the Millennials come to rescue your sales growth. I wouldn't expect the Matures to adopt Millennial behaviors that would keep them as a viable sales cohort .... generally speaking that is, but even they might benefit from answering the following question - Why will people slow their spending after age 60? Answer that and you will find a correct path to market to Boomers and even Matures as they age in the next 10-20 years. 

While part of the reason they spend less is retirement, the reason they will decline in market share is really because they can't continue to drink like they did when they were Millennials (sic). So the simple solution is, consider making some wines that are lower in alcohol but maintain the other attributes the older set prefers. That's easier said than done in the warmer AVA's, but there are available technologies to make a wine that has a traditional flavor profile and has less alcohol, and might fit their pocket book as well.

To that end, last week I came across an article advertising some new marketing research about the size of the Low Alcohol category. link. One statement in particular stood out to me:

"Once considered a niche outsider product category, lower alcohol wines are now growing in stature in many markets around the world. Across the 8 markets looked at in this report, buyers of sub 10.5% ABV wines now account for 38% of consumers, or in other terms, over 80 million regular wine drinkers -making a rather compelling case that this is a market sector which can no longer be ignored. From the 8 markets analysed in this report lower alcohol wines are currently performing best in the USA, Germany, Canada and UK where the number of lower alcohol buyers and consumption of sub 10.5% ABV wine is the highest."

I think that's where we should leave it for today. Hopefully that gives you some food for thought.

What do you think? Should you be spending all of your time marketing to Millennials? Are you investing in the best growth opportunity for today (Gen X)? Are you seeing declines in purchasing from Boomers and falsely attributing that to lower income from the recession? Are the Matures worth marketing to still? Where should you invest your precious marketing dollars and time selling your wine?

Please log in and offer your thoughts to the community.