Sunday, March 27, 2016
Let's talk about Millennials! How exciting is that conversation? Demographers and researchers are laser focused. It's a feeding frenzy at times because that's the growth opportunity of future retail. Boomers are old news, nothing to write home about and not hardly anywhere near as interesting as Millennials.
Oh ... there is GenX of course but why talk about them? They are a small cohort.... except they are the second largest consumer of fine wine in the U.S. today and the largest growth opportunity for most wineries, but that doesn't matter. Let's talk about Millennials!
Tuesday, March 22, 2016
WMC: "Millennials Consume 42% of all wine in America"
The Wine Market Council presented their annual 2016 roadshow in New York in January, and using the above slide announced with fanfare that Millennials are now the largest wine drinking population in America, consuming 42% of all wine and surpassing the boomers with 30% of total consumption. They also said Millennials were consuming 160 million cases compared to 114 million cases consumed for boomers (below right chart).
To many of us in the business the facts appeared grossly exaggerated, but the media ran with the story because it was such a senstational headline. The long-awaited ascendance of the millennial had finally come we were told, and the articles proclaiming the fact hit the wires in waves:
- Millennials Top U.S. in Wine Consumption (CBS News)
- Millennials Come out on Top in U.S Wine Consumption (S.F. Chronicle)
WMC: "Millennials and Boomers Consume the Same Amount of Wine."
"Boomers and Millennials today account for nearly the same amount of wine consumption and Millennials will soon account for decidedly more consumption."
Sunday, March 20, 2016
Every year when we start the Direct to Consumer Survey I'm always a little nervous about participation. The effort required to sell wine has become more difficult by the day, and owners have to make choices about where to invest their precious time. Survey results could be viewed as nice-to-have versus a critical need, but in this case I'd argue this is a have-to-have for wineries with Direct to Consumer sales.
Monday, March 7, 2016
We know that the average winery today has nearly 60% of their sales made direct largely through wine clubs and tasting rooms. How do we know that? Through an annual survey conducted by SVB.
If you have a club or a tasting room, how do you know you are performing at the top of the club performance, or even above the average? If I asked you how many wineries pay for data capture within their comp structure in the tasting room, what would be your guess?
Today 168 wineries have responded to the SVB Annual Tasting Room Survey and here is the result thus far for that question:
What about the average dollar comp awarded to tasting room staff in your region. Is that of interest? How about the average tenure of a club member sorted out by average price point so you can compare your winery against a winery with a similar price point? Would it help to know the average gain in club members in your AVA last year, or what about the average number of lost members?
Each of those questions are examples of benchmarks that will be available to you for free but here's the catch: The benchmarks are only available to those who take the 10-15 minutes to complete the survey. Isn't that an investment well worth making?
When the survey is closed on March 18th, we will spend over 200 person hours completing the analysis and will then return charts, graphs, and an excel spreadsheet cleaned of any identifying information. You will be able to dig even deeper into the data if you want.
In May we will host a live videocast to go over some of the results as we did last year.
In the July issue of Wine Business Monthly, the magazine will publish some of the information and conclusions in their annual Direct To Consumer edition.
None of the above is possible without the 10-15 minutes invested in the survey itself. Please consider taking the time to answer the survey questions. Your participation will improve both your own direct program, and help the US wine industry improve.
Start the survey now: http://bit.ly/1U0KuSa
If you feel this content is worthwhile, please promote the link in your favorite social media platform, or even better - please forward the link to your winery colleagues and ask them to participate.
If you would like your AVA to participate, we will also send them free Regional Benchmarks for their own use if we have a statistically significant sample size and an address to send the information.
Sunday, February 7, 2016
Duck and Cover
I remember walking to school shortly after the Cuban Missile Crisis. We were practicing ‘duck-and-cover’ drills in our classrooms, and we trained on what to do when we saw the blinding white flash. The propaganda video clip at the top is a great example of the beliefs of the day.
Walking to school in the early 60's, I’d plan where I would hide along the route just in case. One of the neighbors had a bomb shelter but after that, it was refrigerators in garages and fireplaces as the preferred hideouts. It was a discomforting time for the Country. President Kennedy embarrassed in the Bay of Pigs Invasion was staring down Khrushchev, the Premiere of the former USSR in a game of nuclear chicken with continental annihilation hanging in the balance.
With that as context, it’s surreal to find myself sitting in a bar in Havana Cuba writing this piece and participating in an official U.S. Trade Mission promoting California Wine. We're not promoting world peace or selling tractors. We're promoting a luxury product to a socialist country.
In the past 70 years executive orders have made it almost impossible to do anything with Cuba, but on this mission we are able to travel based on carve outs for agricultural products. People in the boomer generation never thought they would see Cuba in person. And while tourism from the US is still illegal, the fact that I’m here is a statement of how far relations between the countries have come.
This is a change that isn’t going to reverse course. While I doubt Cuba will ever return to a free-market economy given the scars and excesses that led to their Revolution, this change to allow greater openness will create large economic opportunities for those participating in rebuilding country, for businesses selling into a growth market, and for foreign investment partners.
Saturday, January 30, 2016
Monday, January 18, 2016
2016 State of the Wine IndustryThursday, January 21, 2016
9:30 a.m.–10:30 a.m. PT
I expect this will be one of the most interesting reports we've ever authored. I would like to invite you to join us live for a discussion of the report and wine business with our expert panel: Rob McMillan, EVP & founder of Silicon Valley Bank’s Wine Division, Paul Mabray, Chief Strategy Officer of VinTank, Amy Hoopes, Chief Marketing Officer/EVP Global Sales at Wente Family Estates and Jeff Bitter with Allied Grape Growers.
We will review the findings of the 2016 State of the Wine Industry Report, which is based on SVB’s in-depth survey of wine industry experts and insiders, third-party research and Rob’s unique perspective as a long-time member within the wine industry.
This presentation will include insights on:
- Changes in the market share of imported bulk and bottled wine
- Predictions of 2016 sales growth in the fine wine segment
- Winery financial performance
- Expected changed in U.S. per capita and total consumption
- Consumer demand changes
- Harvest yields and bulk inventories
- Prediced changes in the opportunities of domestic wine producing regions
- Bottle price changes
Please [register] for the videocast and receive a link to the replay and the complete 2016 Wine Industry Report after the live event.