October 2 2006
The Santa Rosa Press Democrat had a really interesting article last Friday. It’s innocuously titled, “Young adults key to wine growth: Millennials a major force in industry as beer falls to No. 2"
There are a couple of problems, however--the article has a mis-leading headline, levels a serious, but relatively unmerited challenge to the wine industry and throws in a little known fact about Kendall-Jackson wines, too.
That’s a lot to cram into less then 600 words.
But, first the error in the article—it cites Gallup research from 2005 where wine consumption was reported to have overtaken beer consumption. True. Yes, that is true.
However, 2006 Gallup research leveled that field with beer once again taking its spot as the leader in general consumption. Why the reporter wouldn’t cite the ’06 research is ponderous—especially when a quick Google search—literally a 14 second search of Google turned up this years results .
This sloppy reporting, in and of itself, renders the rest of the article null and void, but it gets more interesting ...
An investment analyst named Kaumil Gajrawala, an analyst with UBS Investment Research, alleges that the wine industry won its one year battle against beer in overall consumption because the beer industry was marketing poorly over the course of the last six or seven years. The article says:
Beer companies lost market share to wine and spirits largely because their advertising campaigns in the 1990s and early 2000s were sophomoric and failed to deliver a message about the quality of their products, Gajrawala said.
To support his contention, Gajrawala played a compilation video of beer ads that showed bikini-clad women wrestling, overweight male sports fans in full-body paint, and men driving golf balls in ludicrously inappropriate places.
"A 23-year-old doesn’t want to identify with that," he said.
Gajrawala then played newer campaigns by major beer companies like Coors and Budweiser, which he said are hipper and more likely to appeal to the millennials. The new ads are an indication brewers have learned the error of their ways, he said.
"Clearly, you can see the beer companies have changed their strategy in terms of how they are going after consumers," he said.
That’s important for the wine industry because if the beer industry and its massive marketing clout does a better job of keeping young drinkers well into adulthood, wine may have a tougher time growing at the rates it has enjoyed, he said.
"The free ride for wine is probably over," he said.
Interesting. Very interesting.
I’m not sure if Mr./Ms. Gajarawala has been on Youtube.com or Myspace.com lately, or if a visit to the newsstand with the likes of Maxim, FHM, the Onion, have been in order, but a slew of other sophomoric content areas geared toward young adults is clearly in the offing and selling to a younger demographic slice. In my humble opinion, he’s clearly off the mark.
I think the point is that Generation Y is something of mystifying generation in terms of creating marketing that resonates and there is a clear dichotomy between the sophomoric laugh-a-minute joie de vivre of this demo, juxtaposed against a desire for “adult” pursuits and pleasures.
And, it has nothing to do with “critter” labels, either. It’s all about creating an authentic, trustworthy brand that backs up the brand positioning with quality.
You’re just as likely to see a Generation Y kid wearing jeans, a hoodie AND buying a nice $22 bottle of vino AFTER he played Xbox for the last 2.5 hours while listening to his iPod, then you are seeing him walk out with a bottle of Little Boomey at $6.99. Quality AND Brand has to be a factor.
Though, the analyst may be right about one thing: the free ride for wine, if that’s what you want to call it, may be over. But, it won’t be because of beer advertising and its relative efficacy.
A footnote at the bottom of the article references Kendall-Jackson’s new division called White Rocket (a winebusiness.com article can be found here). The goal of the new division is to create brands that resonate with younger consumers, a demographic that clearly shows hockey stick-like growth potential.
This is a good idea.
The White Rocket offices are in a Napa office park, and their neighbors are, if I’m not mistaken, Don Sebastiani & Sons—guys that do video blogs for pete’s sake and some folks that know a thing or two about marketing wine to a younger demo.
Maybe the USB analyst should ask Don Sebastiani how his sophomoric brands like Screw Kappa Napa, Plungerhead, Hey Mambo, and Used Auto Parts are doing. I’m guessing these zany wines are still getting the so-called “Free Ride.”
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October 1 2006
Perhaps even more difficult then marketing wine is marketing spirits—vodka, gin, and the like. There are no tasting rooms for most spirits brands—save for some whiskey in Kentucky—and there is significantly less romanticism owing to the actual beverage. Certainly there are no decorous vines to dapple the landscape and evoke sprightly visions of a lifestyle.
Spirit consumers are mercurial, finicky, status-sensitive and narrowcasted thin slices of demographic segments.
If you’ve been in a nightclub anytime in the last twenty years and shouldered into a throng of people at the bar then you know that vodka—seemingly tasteless and odorless—is frequently called by name—a Grey Goose and Red Bull, for example, is a different drink to a different person then a well vodka Gimlet, for example. Status can be manufactured and the Skyy Vodka of my day can be quickly replaced by something newer and more interesting.
Being accountable for the success of a new vodka, with quintuple distillation, made from a rare starch free potato from the nether regions of the Czech Republic is a simple enough proposition in order to tell a story, but usually there is no boutique to it—not as much artisan and more manufactured mystery—except in the Scotch trade where 60 year old barrels of scotch seem to materialize every year in order to make a special “Reserve.”
Given this, the conundrum is: how do you get consumers to identify brand attributes in a market era that plays to wines strengths, but nor liquor—authentic and artisan.
I think the easiest answer has to be if your brand can’t satisfy all of the markets demands for authentic and boutique then you should associate your brand with people that are deemed to have these attributes. This is age old and certainly no revelation, but rarely is it done effectively. Wilford Brimley and oatmeal notwithstanding, however.
This makes the Grey Goose Iconoclasts series all the more interesting. Featured in Food and Wine magazine and presented on the Sundance Channel, these shows are hour long documentaries developed by Grey Goose Entertainment that pair two seemingly disparate celebrities—like Eddie Vedder, the lead singer from Pearl Jam, and Laird Hamilton, world class surfer and American Express pitchman. Or, Dave Chappelle, comedian, and Maya Angelou, author and activist.
Without the benefit of having seen the new season that starts on October 26, I can only say that the pairings of celebrities is intriguing—intriguing to the extent that they may be pulling off the osmosis based subtle influence that the Iconoclasts series is surely trying to achieve.
I mean, honestly, Alice Waters of restaurant Chez Panisse fame and Mikhail Baryshnikov? Iconoclasts certainly!
I’m not advocating wineries do this sort of marketing because I think there’s enough marketing fodder for every winery to tap that would already resonate with consumers, but I sure would like to see an Iconoclast series that pairs a couple of wine industry titans—how about Robert Mondavi, or Robert Parker to pair with this series on Robert Redford’s Sundance Channel?
Check out the web site, in advance of the season 2 premiere here.
I will be pouring a glass of wine, though I’m certain Grey Goose would prefer that I quaff a cocktail.
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