Millennials & Wine w/ Damien Wilson, Sonoma State University

With values and attitudes formed around the turn of the 21st century, Millennials want fulfilling careers, are more into environmental and social causes, and grew up in the social media era.  Damien Wilson, Hamel Family Chair of Wine Business at Sonoma State University, explains who Millennials are, what drives their buying habits, and the brand loyalty of the group.  This is the first part of a two-part series on marketing to Millennials. 

Detailed Show Notes: 

• Damien’s background
  • Mid 1980’s - worked in grocery retail in wine & spirits
  • Early 1990’s - worked in hospitality as a wine steward
  • Mid 1990’s
    • wine sales rep
    • Completed 4 degrees in the wine business
  • 2007 - left the University of South Australia and Australia overall with a Ph.D. in Wine Business
  • Research areas include: 
    • History and usage of screw caps and natural cork
    • Consumer behavior - consumption patterns that lead to wine consumption
    • Digital marketing, tourism
• Defining Millennials
  • Generational cohorts - they may change their name as certain experiences become the dominant characteristic of their values
    • Each cohort is distinct because of their experiences, which have information and directive influences
    • E.g., Silent (formerly Great) Generation - values were set during war years
      • Baby Boomers - the boom in population growth post-war
      • Gen X (used to be called latch key generation)
      • Gen Z (1997 onwards) - have no real memory of September 11th (2001), were initially called the “i -generation” because they were attached to their iPhones
  • Millennials
    • Originally set from the late ’70s (as early as 1976) to the early 80s birth years 
    • Current definition (from Pew Research Center and Brookings Institute) - 1981 - 1996
    • Attitudes and values formed during the decades around the turn of the 21st century (1990s-2000s)
• Millennial Values and Attitudes
  • Want a fulfilling career vs. a stable or secure career
  • Exhibit stronger support for social and environmental issues
  • Have the largest perceptual gap of their long-term vision vs. their initial reality - they had huge expectations of adulthood and were hit with reality (you start at the bottom) and the Global Financial Crisis
  • Lived in the social media era - see the extremes (people curated perfect lives)
• Millennial Wine Buying
  • Wine buying is tightly correlated with economic status
  • Generational buying
    • Silent Generation - marked by frugality, drank less wine because it was more expensive
    • Baby Boomers - expressed interest in wine and shares with others, have been the driver behind the recent success of the wine industry, wine as a relatively inexpensive way to show success and luxury (e.g., Silver Oak success)
    • Gen X - eschews traditional brands, tried different things (e.g., led to the Rhone Rangers movement)
    • Millennials -
      • focus more on enjoyment and the collective vision of what wine means for their generation
      • want individualism, but also consume brands that are more representative of their group
      • Humor, innovative approaches, bohemian, off-kilter brands can be successful
      • Willing to accept something that reflects values and intent, even if not total wine specific, whereas the prior generation was more focused on the wine itself)
      • Receptive to sales and marketing messages as long as it is authentic to the brand
  • Buying pattern formative period in teen and early adult years, particularly for aesthetic consumption and will likely persist over time
  • Millennial brand loyalty
    • Brand loyalty starts with awareness - awareness of anything trumps lack of awareness which makes consumers start with a degree of brand loyalty
    • The pattern is repeated until people gain more comfort with products and they move to brand extensions
    • New wine consumers (e.g., Millennials) are still new to the category, still just learning what wine is
    • Proud of and support brands that support them (e.g., Supreme - streetwear); wines they drink are wines that support them and have brand loyalty to them (e.g., Buena Vista, Chateau Diana)
    • Perception of brand loyalty may be due to low wine club signup rate
  • Millennial wine spending habits
    • Spend 2x more than the grocery store average on wine
    • Highest spend per unit of any generation (high $20s - low $30s/bottle)
    • $10-15/bottle is the sweet spot in grocery/retail
  • Awareness key to buying wine
    • Napa has the greatest awareness of any US wine-growing region, which helps
    • Iconic wines to still do well due to brand awareness

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