Wine Consumer Power

by Eve Resnick on July 16, 2013

in International Markets

Web 2.0 was supposed to give more power to the wine consumer. One could express oneself on forums, Facebook, Twitter, blogs, Google+ and all social networks. One could get in touch with favorite wine producers while producers could answer disappointed consumers. The virtual world was considered the best friend of the wine drinker.

ShipItHomeUSA-LogoThen reality struck back. While traveling, wine lovers felt frustrated. This beautiful wine they tasted at a wine bar or while visiting the estate could not be brought back or shipped back home. American tourists expect to be able to ship back home their wines. Unfortunately the complex laws regulating the wine business in the US (and safety rules in international airports) make this dream almost impossible. Some international trade experts brought a solution to this issue. Let’s imagine you are traveling in France or Italy, fell in love with this gorgeous Sangiovese or this velvety Margaux wine and want to ship a case (or two) back home. A few years ago it was impossible. Since 2010, if the producer you are visiting is a member of “Ship It Home USA” founded by Barry Gilbert, your dream will come true. The beauty of the system is that either the winery or the consumer has to worry about shipment: the consumer selects and pays his wines, gives his American home address and will get his case(s) when he is back in the US. The winery just packs the wines and hands them to Ship It Home USA for a fee.

The service is still finding its way to European wineries: a few in France, Italy, Greece and Canada are members. As a marketer, I  can only hope it will be adopted by more and more wineries as the service can really helps develop brand awareness and sales among American wine tourists.

In the USA, the three-tier system is not helping the wine lover either. Recent laws prohibiting trade between states irritated some wine drinkers. Tom Wark heard them and launched the American Wine Consumer Coalition.  The AWCC has three main goals: “Lobby in the states and at the federal level for the rights of wine consumers; Educate wine regulators about the real interests of wine consumers; Inform the media of the interests of wine consumers”.

From a marketing point of view, both organizations are critical to the wine market. By giving more power to the wine consumer (who is never consulted on what he wishes or needs), they provide a better service and give voice to what the consumers want. Good luck to both services!

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Vinexpo is one of the many short cuts wine professionals can take to look at some of the latest industry trends. I spent four days talking to people, looking at packagings and tasting what was in the bottles of those new packaged wines, checking new wine brands and innovation.

RoyanceWine Europe is still the land of terroirs and geographical identity, which very often makes for traditional labels and bottles. Most wine consumers and professionals are aware of the Bordeaux and Burgundy bottle shapes and are familiar with the design of the Bordeaux chateau or the Burgundy domain. Aware of the boredom of some labels, younger European wine producers are launching fun labels and bottles shape, such as the Royance brand.

Is it really what the new consumer is expecting? A recent webinar organized by the magazine Labels and Labeling addressed the issue of what an efficient label is in the competitive world of wine brands.

““The U.S. is now the No. 1 market in the world, and it is a target for imports,” [Wines & Vines editor Jim] Gordon said. “This sets the stage for great packaging and labels. More impressive than the market growth is the growth of U.S. wineries, which took off after the Millennium, even faster than sales. Our data shows more than 7,558 wineries (including brick and mortar and virtual wineries) in the U.S., and 529 total wineries in Canada.” Many of these wineries have more than one wine brand, amounting to an additional 3,150 extra brands, in all. ”

One of the key  factors is the label that attracts the eye of the shopper on the shelf. A lot of brands are now creating fun, energetic,Witches Brew Label colorful or provocative labels for their wines. What would strike the eyes more than a fun label? The next question is: whose eyes will it attract? Baby Boomers and Millenials, the two rising categories of consumers, don’t shop the same way. When Millenials buy a wine for its quirky label, baby boomers require bold fonts for their failing eyesight. According to Wines and Vines article, “Forty-nine percent of Millennials will scan a QR code if they see one.” Toni Hamilton, director of marketing for ASL PrintFX, told Jane Firstenfeld, from Wines and Vines: “If you decide to use QR coding on your labels, make sure you have the resources to support it. It provides an immediate payoff.…Make sure to mobilize your landing page; make it valuable.” Furthermore, Firstenfeld stated, “Most commonly seen on back labels, QR codes can be used as an integral part of the package design.”

Nice and original labels are not only important for the domestic market, they are essential for international markets. Ubifrance, one of the leading French export body, presented a study on labels and bottles adapted to the Chinese market during Vinexpo. There were a few surprises. When American and European consumers favor an original label, Chinese drinkers are mostly attracted to traditional design and bottle that they even copy for their own bottles: the label of Carruades de Lafite, the second wine of Château Lafite in Pauillac, gave birth to a Chinese “version” for their Grand Dragon brand.

Seemingly traditionnaly designed bottles are more attractive to the Chinese consumers:

Fun and sophisticated labeling in the Western world, traditional style in China are the expression of the evolution of the local market. Consumers still in the learning curve are reassured by traditional values while more evolved and sophisticated drinkers can play with labels and bottles without worrying about the content of the bottle. They trust their own knowledge to enjoy their glass of wine.

 

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Threat to Wine in Europe

by Eve Resnick on June 14, 2013

in International Markets

vinkara-landscapeVinexpo is opening in Bordeaux in 2 days. The wine industry is as usual in that period under the scrutiny of international media since it is one of the strong events of the business. Weirdly enough two European governments chose this moment to announce new laws or reinforcement of existing laws in two countries, well known for producing great wines, France and Turkey. In Turkey, law number 6487 would put a lot of restrictions on the promotion and sale of alcohol. In France, the (in)famous Evin law would be reinforced: bloggers, whether they are producers, marketers or journalists would not be able to write about wine anymore or use social media to express themselves.

What is behind those projects? Taner Öğütoğlu, Director of Wines of Turkey, told Andrew Jefford: “We don’t know how to react. If there was a big threat of alcoholism, we would understand the need for legislation. But there isn’t; the level is very low here in Turkey – much less than 1% of the population. What the government is doing is bringing in religiously orientated restrictions.” Jefford also talked to the President of the Turkish Wine Producers’ Association, Ali Başman of Kavaklidere on the same topic: “[...] the law would make it hard for new products to be launched and discussed, for new restaurants wishing to serve alcohol to open, for wineries to sell on the internet and for ordinary Turks and overseas visitors to visit vineyards.”
jeunes-vinFor French health officials, Internet is the favorite media of young people. By forbidding wine professionals to write about alcohol, including wine, on blogs and social media, health official hope to decrease binge drinking.  In “real life”, young people don’t go on the Web to learn about alcohol, they go to the supermarket to buy spirits.

Is edicting a law the right way to prevent alcoholism or binge drinking? Prohibition in the US showed the inefficiency of such tactics. Alcohol became even more seductive because it was forbidden. Education on the other hand is a good way to promote moderation and to teach how wine is linked to the history and the culture of a country.

 

I wish a lot of people will attend the tasting organized by the Wines of Turkey during Vinexpo and will then testify of the long and beautiful history of those wines. I also wish that our politicians will come to Vinexpo, talk to producers and professionals passionate about their craft and business, taste some great wines from all over the world and come to realize that wine like music is one of the most powerful links between civilizations.

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china_wineChina and European wines were having a wonderful honeymoon until a few days ago when China threatened to fine European wines in retaliation of European taxes on Chinese solar tachnology imported to Europe. (I am NOT joking!) European wine producers exported more than a billion euros to China in 2012. France is the first exporter with 140 millions liters of wine sold in 2012, Bordeaux being  the main region while Burgundy does not rely as musch on China that bringts only 50 millions€.

Chinese wine drinkers are more and more educated and can make the difference between bad, mediocre and great wines. This is thanks to the education brought by Chinese sommeliers and wine professionals trained in Europe as well as iniatives by major European brands and estates.

Michel Gonet, famous Champagne House also owner of several properties in Bordeaux, opened a private club in Shanghaï, pronounced Gaonai. First famous for its high quality Champagnes, Michel Gonet expanded to Bordeaux where he acquired Château Lesparre and château Haut-Bacalan managed by Charles-Henri Gonet where the famous Chinese TV series, Cherish Our Love Forever, was filmed in 2010. Because of his priviledged links with the Chinese young consultant Hao Zeng and the success of the series in China, Frederic Gonet reinforced the family presence in Shanghai through the Gaonai Center.  The Club is dedicated to the French lifestyle with upscale wine tastings, master classes on Bordeaux wines and of course a gourmet restaurant.

On an even more commercial scale, some major auctions are now organized by the most prestigious brands in Shanhai, Beijing or Hong Kong.  Domaine Clarence Dillon, owners of Château Haut-Brion, Château La Mission Haut-Brion and Château Quintus, just announced its first ex-cellars auction in Asia, according to Jane Anson. Chinese conglomerates are buying wine estates in Bordeaux and Burgundy. The famous wine consultant Michel Rolland just sold his three chateaux to Sutong Pan, chairman of Hong Kong-based investment holding company Goldin Financial Holdings and Chateau Loudenne was purchasesd by the Beiju Group.

What would be the potential consequences of the Chinese retaliation? Wine professionals and European press were outraged by the Chinese threat and its consequences on sales in China. More likely, any retaliation would also be a risk for  Chinese wine lovers. They would have to pay a lot of money to get their favorite wines. A moderate consumption of wine (instead of the current heavy consumption of beer) is recommended by the Chinese governement as  a good influence on one’s health. Wine is also becoming a cultural product (more than just a commodity or a status product) in China. And what about all those properties bought by Chinese groups or individuals? What will become of them?

The delicate balance  between the French and the Chinese wine industry could be challenged by a move of the Chinese governement.  Wine is not only about money: it is also about culture, sharing and taste. Europe built over the last 20 years deep links and gained much knowledge about the Chinese consumers’ tastes. Chinese wine lovers learnt to appreciate and know our wines. What a pity it would be to destroy this nascent cultural exchange over some solar panels issue. Let us hope it is only a storm in a teacup, at least in a very samell wine glass.

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Is a post on Social Media advertising?

May 27, 2013

This question seems ludicrous to a lot of American wine professionals if I believe what I read in the last few days about the new TTB guidelines. In Europe and mainly in France this question was answered years ago by the Evin Law: yes, talking and writing on social media and/or on the Net about […]

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Is pink the new wine color?

May 30, 2012

With weather improving everyday, pink wine is more and more visible on restaurant tables and in people’s homes. Is it the new wine color? For many years, in Europe, pink wines were considered as “non wines”, i.e. wines for people who didn’t know anything about wine. Then,  it was considered as the “wine for women”, […]

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400 American and Chinese Blogs under scrutiny

April 24, 2012

In 2011, The Wine Management Institute of Dijon, in Burgundy, France launched a 5-year study on international wine blogs under my direction with the help of our 40 to 50 students coming from all over the world. The first year (2011) was devoted to American and Chinese blogs. We are on our way for the […]

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Celebrating Women Wine Producers and Professionals

March 8, 2012

March 8 is officially our day, Women’s Day.  We should pay more often a tribute to those women, wine producers or professionals, who are often the source of interesting initiatives. This article aims at mentioning just a few of those ideas or different approaches on various wine related topics. This is my way to tell […]

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Good news for consumers, bad news for producers?

February 13, 2012

A recent study by Nielsen shows that the 2011 trend of decreasing prices for wine bottles will keep going in 2012. If this is good news for consumers, it is bad news for producers who would like nothing more than reversing the trend.  But it will not be the case in 2012: According to Wine […]

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Coming back on line with new thoughts

February 2, 2012

Letting a blog silent for many months after years of writing posts several times a week and sharing thoughts with readers and/or friends was not an easy decision. Of course, I could mention the increasing pressure of work and of two teaching positions, speaking assignments  in the US and Europe or the writing of a […]

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