A quote stolen from the legendary Bob Dylan is a great way to sum up the sentiment taken from the annual Wine & Spirits Wholesalers of America (WSWA) convention, held last week in Las Vegas, Nevada.
How are the times a-changin’? Maybe the most significant shift the industry has experienced as of late is the reliance on Millennials as a category to market to. Millennials have taken a head first dive into wine, viewing it as less pretentious and intimidating a beverage category than generations of yesteryear.
Why have Millennials more quickly embraced wine, throwing all preconceived notions to the wind? John Gillespie, president of the Wine Market Council who recently spoke at the WSWA convention, attributes it to cultural exposure. He was quick to point out that a majority of Gen Y people are watching things like the Food Network, explaining that they are “tremendously interested in food and entertaining and cooking at home.”
The explanation of Millennials interest in wine goes much further than exposure through public television. Just 10 years ago, if a 20-something had the desire to immerse themself in wine culture, they were restricted to only a couple of options; get a job in the industry or buy a 500+ page text book. In our current internet era, there are more engaging and interesting ways to suck down grape news and booze.
With the emergence of Millennials as the most important demographic for wineries to focus on, which wineries are in a position to capitalize? The numbers point to those positioned in lower priced categories. Wine Market Council survey results found that 69% of core wine drinkers (those that drink wine at least once per week) believe they “are finding good quality wines available at lower prices.”
For further proof of this, look no further than the recent surge in Argentinean and Chilean wine sales. A recent report placed Argentina, formerly an almost non-existent player in the wine sales game, as the fifth largest wine exporting nation in the world. This is largely attributable to Gen Y drinkers subbing $15 bottles of Malbec for $50 Napa Cabs.
With impressive quality at reasonable price points, younger consumers, who have less disposable income, aren’t likely to abandon the Malbec and Carmenere that they’ve come to know and love, even after the economy fully recovers. This bodes well for the emerging wine regions and wineries with attractive price points and esoteric options. Could this leave more expensively priced categories, like Napa Valley Cabernet, Blowin’ In The Wind?
