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March 15 2006

Markets Consist of Human Beings, Not Demographic Sectors--Cluetrain Manifesto #2

As a card-carrying member of the corporate drone life, I’mused to the fact that Dilbert resonates deeply, and frequently, and the notionthat a corporate project isn’t a project until it has a snappy name—becauseotherwise intelligible folks can’t grasp a project unless it’s called the“something, something.” Usually this isa descriptor for Sr. Manager’s so they can succinctly take credit for and referto the project when speaking to other Sr. Manager’s as an indication of thesuperior progress he/she is making in resolving some customer or company ill inhis/her department.

Typically, the project has a strain of relativity to theissues at hand, and may speak to some larger societal aspect that we can draw aconnection to.

Frequently, the success of the project doesn’t matter asmuch as how much internal and external P.R. was generated. Perception is reality so issue a pressrelease.

Constellation Wines, the world’s largest wine producer,published a research study in the Fall called Project Genome, one the largestresearch studies ever conducted in the wine industry. Conducted in conjunction with Copernicus Marketing & Consulting(Who else would Constellation work with then Copernicus?), the study breaks outwine consumers into six segments. Asthe press release mentions, just as we are trying to map DNA, they are tryingto map wine buyers purchasing DNA.

The six segments of wine buyers are listed as:

Enthusiast:
12%of the population

Image Seeker:
20% of the population

Savvy Shopper:
15%of the population

Traditionalist:
16% of the population

Satisfied Sipper:
14%of the population

Overwhelmed:
23% of the population

You can read the entire summary powerpoint, press releaseand other materials here:

On the whole, it’s hard to discount this research as themethodology appears to be sound. And,while this may be the largest research study conducted, it doesn’t appear tobreak any new ground in categorizing wine drinkers then what has been conductedpreviously—just on a larger scale.

And, ultimately, what Constellation states as their goal forthe project is to help retailers and restaranteurs improve their product mixbased on their population of customers from the above category.

Here’s where I diverge on this research and why, ultimately,I believe this will be a project that looks good on the resume, but neveramounted to any seismic change.

Constellation wants the change to happen down the value chainwith retailers and restaurants—helping them to sell through more wine, moreeffectively. In essence, they areplaying into and supporting the growing category management function that saysthat the right product at the right place at the right time will sell through.

Put the onus on the retailer to raise their game.

First, the research doesn’t address Generation Y, atall. They don’t fit into any categoryidentified cleanly, and Constellation seems to have played into the currentmarket with Baby-Boomer’s as their chief target to address.

Here’s the rub on both customer fronts, consumersincreasingly eschew modern marketing tactics and increasingly give credence toviral, or word-of-mouth influence models—and actually steer away from packagedmarketing, typical of what a Constellation may do in the channel for itswine.

Secondarily, and most importantly, customers are nowmulti-channel shoppers—meaning they purchase from numerous stores. Just as Constellation publishes thisresearch, it’s highly likely that their so-called segments are dodging thesupermarket and going to buy wine elsewhere in an affinity-based manner—statusseeking. So, they can help asupermarket reach a traditionalist, who has really just decided to buy produceat the store and then head to the wine shop to buy wine for dinner because theyaspire to be an image seeker.

How the hell do you manage that?

The other thing that this research naively doesn’t addressis the entire state of the wine industry and the fact that there is an absolutepreponderance of wine labels and the fact that virtually all wine purchasedecisions are made at the point of purchase?

Seriously, how do you address the “savvy shopper” thatdoesn’t know what she wants and is demographically out of her element shoppingat a place that may not mesh with her socio-economic status?

The answer is, you don’t and can’t.

The real answer is there isn’t a wine shop that exists thatsells wine the way people want to buy wine—in my estimation. And, that is, play to the affinityaspect. What does this wine do forme—what’s the story; the story of the winery, the story of the brand, how doesthe label grab me? Is the merchandisingsomething that tells me something I didn’t know, and is it organically createdor slick and “produced”

The other day we talked about winery tasting rooms and whywine absolutely fly’s through the tasting room—it’s because people areassociating the wine with the experience, to be shared now and later as thewine is enjoyed.

Taking the story into retail and restaurants, treatingpeople as individuals whose needs and whims change constantly and providingthem something to identify with will ultimately be a greater contributor tosuccess then helping get Rex Goliath into Publix because you know thisdemographic base shops there. They may,but they’re also down the road at the Costco looking for a perceived gem thatoffers something compelling in the form of a story—across all demographicboundaries.

Markets do consist of human beings and ultimately,Constellation is missing a huge opportunity if they do not enable their channelcustomers to become better in-store marketers—for all people and the commonthreads that links us all. This isabout selling wine the way people want to buy and not the way that a companywants to sell i.e. taking the approach of market disciplinarian with having theperceived right product at the right place because usually it will be wrong.

To paraphrase a Walt Disney quote, he was asked if he wasafraid people would copy all of his ideas, and he said “Those are last yearsideas, we’re working on next year’s ideas.”

Wine marketers need to start working on next years ideas.

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March 14 2006

70 degrees and Fluorescent

I never cease to be amazed at winery tasting rooms and thethrongs of people that come on the weekends.

I live in the Midwest and even here the more notablewineries in the region are packed on the weekends with customers lined up twodeep at the tasting counter as the winery staff fights with noble vigor to keepup with the customers that have made their third trip through the list.

And, I never cease to be amazed at the purchasing thathappens. Normally rational people getcaught up in a moment of euphoria and suddenly have an urge to buy a case ofwine. The fact that they’ve been buyingonesy-twosy at grocery stores their whole adult wine drinking lifenotwithstanding.

So, I’m at a trade show in Las Vegas this week and I’ve longbeen fascinated with the notion that taking a mobile tasting room concept andacting as a sub-contractor to a catering organization would be a tidy littlebusiness. All of these trade shows arelooking for the edutainment aspect in the “fun” portion of the conference. And, regardless of industry, all conferencessell the fun via location and parties, etc.

And, even more important to them, they usually roll the beerand wine bars in at 4:30 to try and keep the late day traffic in the conferencecenter to placate the exhibitors that are inevitably always grumbling about thebad location, low attendance, or lack of decision-makers.

So, wouldn’t it be cool if you could create a business thatwould pour a bunch of good wines in a sampling format for customers, like awinery tasting room would do? You couldgo to a Mondavi or a larger winery and get a sponsorship deal going—the companyor the sub-contractor manages the personnel and the tasting and the sponsorshipand takes a flat fee for the project from the client.

This beats the pants off of the current beer and wine shtickthat happens on conference floors with wines that are usually not very notable by anybody’s standards—Lindeman’s Shiraz, anybody?

But, I have just talked myself out of this. Why?

Brillat-Savarin wrote extensively on the Physiology ofTaste. Many people may be familiar withhim from a couple of his famous quotes one of which is featured on the FoodNetwork show, The Iron Chef. It goes, “Tellme what you eat, and I will tell you what you are.”

The Physiology of Taste is more treatise and anecdotal thana true meditation on the science of gustatory pleasures, but the net of it isthat eating and drinking is physiological—the sum of all of our senses. More physiological certainly thanpsychological which deals only with the science of mental processes andbehaviors.

What would Brillat-Savrin say about my little businessmodel? He would say that wine and foodare best enjoyed with friends in a convivial setting. Time, place and circumstance has as much to do with enjoying winethen anything else.

So, the sum of it for me is that I don’t think a businessaround wine tasting at a conference works because I’ve never had a good wine ata wine tasting bar at a conference and nor do I think anybody makes a wine goodenough to stand up to the rigors of when it’s 70 degrees and fluorescent on thefloor of a trade show.

I tasted a Malbec yesterday with a cheese tray in front ofme, but by God, and with God as my witness I don’t think that wine would havebeen worth a damn even if Parker gave it a 99 because I was in Las Vegas on aSunday against my will rubbing elbows with people I hold in semi-contempt.

The lesson here? Order the best looking value wine on the menu and enjoy good company atdinner—the wine and your companions will be the better for it.

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March 12 2006

What If Gerard Depardieu and Salma Hayek had a Love Child?

When I started this blog, I intended to never utter a word about French wine--I wanted my blog to focus on American wineries, primarily with a bent towards smaller wineries juxtoposed against some fun with the Adventure brands--many of which come from the wine conglomerates.

But, in the vein of constructive analysis, I’m amending that to this: I intend to never promote French wine.

Some things are so confounding that they deserve a closer look.

It used to be that the French Paradox used to refer to the seeming contradictory fact that the French ate large quantities of rich, fatty foods, yet had a very low incidence of heart disease. This positive has largely been attributed to their consumption of red wine with its ancillary health benefits.

I am lobbying that the New French Paradox is the seemingly contradictory notion that the French, particularly French winemakers know anything about marketing. Now, given that the French still have an ongoing love affair with Jerry Lewis, I suppose we should give them a hall pass.

This article appeared the other day related to the French importing three new wines called, respectively: 3 Bandido’s, Jet Lag and Tasty.

Los 3 Bandidos is one of dozens of French wines looking to moveinto the lower-end U.S. wine market. Many on offer at this week’sFrench Wine Road Show are aimed at younger consumers who may not knowthe difference between a grenache and a merlot—they just wantsomething to drink with barbecue ribs.

How does it taste? "Likethe first thirst-quenching drink after two days in the Sonora desert,"according to promotional copy describing the Bandidos Syrah Rose, which"jumps out of the glass, all raspberry and spunk."

Spunky ornot, it is made in southern France, and while its heritage includes oneJesus Navarro—reputedly the right-hand man of 20th century Mexicanrevolutionaries Villa, Emiliano Zapata and Venustiano Carranza—it isbeing marketed by Gabriel Meffre, a winemaker based in the village ofGigondas since 1936.

"These young people do not like traditionalconcepts" in wine, said Andree Ferrandiz, who manages the wine-tradingfirm Somacvins DF Service. "They prefer to be caught by somethingspecial, a new concept of what the consumer wants to find."

Here’s why this won’t work. First, it’s a tremendous disservice to a customer that I doubt they are in touch with. But, second, any state side wine marketer would say the following:

The reason that Yellowtail worked for Australia and other adventure brands are working for New Zealand, Spain and Argentina is because those countries didn’t have a wine identity in the states, so clever marketing helps create an identity to fill the space that wasn’t previously filled in the consumers mind.

But, with all due respect, the reason your 3 Bandido’s won’t work is because the younger consumer that you are trying to target already have a pre-conceived notion of French wine. They pass that section at the wine shop to get to the back corner where the specials are. By pandering to this demographic by associating a French wine with Mexican Cowboys to Americans is beyond a level of comprehension. The very first tenant of marketing to Generation Y (Generation X, for that matter) is to be authentic.

The second reason this won’t work is you anticipate targeting a younger consumer that may not know the difference between a Grenache and a merlot. But, unfortunately, Gen. Y is coming online as a "Core" wine consumer and they are the most learned generation ever. They know what they like.

This is as far from authentic as possible. Contrived comes to mind. Grasping at air comes to mind, as well.

You have violated that tenant and have added gas to the fire by invoking it as, "Like the first thirst-quenching drink after two days in the Sonora desert.

Nevermind, that when parched from being in the desert nobody wants a glass of wine over, say, a glass of water.

If Gerard Depardieu and Salma Hayek had a love child it would surely drink tequila.

Posted in, Good Grape Daily: Pomace & Lees. Permalink | Comments (1) | Print | Email This

March 11 2006

New World

Posted in, New World. Permalink | Comments (0) | Print | Email This

March 10 2006

The Terroir of Flavor

In the upper reaches of the wine world, there is a simmering disagreement over the direction of wine.

In one camp, you have the so-called "Adventure Brands" that might be a blend of grapes from different vineyards to create a specific taste profile, or just simply not marketed so much based on its place of origin.

On the other hand, you have wineries both great and small that actively embrace the notion of terroir.

The Terroir-France website asserts that "a ‘terroir’ is a group ofvineyards (or even vines) from the same region, belonging to a specificappellation, and sharing the same type of soil, weather conditions,grapes and wine making savoir-faire, which contribute to give itsspecific personality to the wine." Some writers include history,tradition, vineyard ownership and other factors.

So, under the sub-set of the argument of "New World" wine versus "Old World" and the real difference between the two being the alcohol-level and "fruit-forward" nature of the wine (New World wines are considerably fuller in fruit flavors then Old World), you also have the terroir disagreement.

Now, unfortunately, this isn’t of real interest to 98% of the wine consuming public who just care that a wine is enjoyable and enjoyable with the company that they are sharing it with.

But, to 2% of the wine drinkers--the folks that buy prestige bottles and have the cellar this is a major source of contention.

Leave it to good marketing, though, to kind of turn this thing around. Kendall-Jackson is a pretty big winery--they sell boatloads of their Vintner Reserve Chardonnay on end-caps at grocery stores. But, they try to present themselves as a small winery. It’s an interesting dichotomy and one that they seem, by and large, successful in pulling off.

I noticed in a recent ad, that features Jess Jackson, the founder, and, if I’m not mistaken, the current equivalent of Colonol Sanders as founder and eponymous spokesperson, that they are using the term "Flavor Domaine" as a descriptor for the taste profile of their wine.

This is really clever. Because, at the end of the day, in order to build a brand you have to have a repeatable product. People have to trust you and the product enough to know that they are going to get the same consistency from visit to visit.

This, of course, runs counter to the wine business because wine is, afterall, a highly variable agricultural product. Year to year the product can change radically.

http://www.kj.com/learn/vineyards/regionalflavor.asp

Ultimately, the wine business is big enough and fragmented enough that it will continue its trajectory of high-end boutique wines while the major producers produce a relatively repeatable product--as this follows what we are seeing in other industry’s where we might buy all of our daily needs at Wal-Mart, but create a personal identification for ourselves by buying groceries at Trader Joe’s and clothes from Anthropologie--both retailers that focus on a more refined customer segment.

But the duality of the Kendall-Jackson play deserves watching because they are creating the rules in this branding exercise and not following the rules as so many other wineries seem to do.

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