As a new group of consumers are set to be the majority buyers in the wine industry, executives are discussing the potential impacts of how these populations will change the market. With nearly 73 million consumers ranging from the ages of 23 to 38 set to be the primary drivers and influencers of wine sales, new business strategies will be necessary to attract and retain these consumers that have different interests, values and buying demands than previous generations.
One big focus will be on the way these populations purchase and consume wine. Traditionally speaking the storefront model has driven buying patterns in the market but changes are being seen as younger demographics are making their purchases through other channels. “For many years the consumer experience in the wine industry has always been front and center but that is changing now as businesses are moving away from their roots in location-based operations to the direct-to-consumer model. Whether through monthly subscription services, personalized blends ordered via app or online wine purchases- the experience is becoming much more about convenience and accessibility.” shares renowned wine collector and entrepreneur Marcus Hiles.
This key fact will be critical to success for those wineries who are able to adapt to new groups of consumers with different values. Evolving retail strategies away from winery locations as the main point of consumption to more scalable means of delivery will be required as younger consumers look to easier access and convenience as a key part of their purchasing decisions.
Also important is understanding this consumer groups’ openness for new product discovery and their desire for authenticity in the wine industry. Having established a thriving market for high-priced, aged blends that often drives much of the profit and recognition for many wine businesses, younger consumer groups are looking away from the expensive model and more towards mid-tier blends that fall into different categories. Cost is a big factor as younger consumers are more likely to pass on high priced beverages for other more affordable options, which the market has made easy with a diverse selection at each price point.
Price alone isn’t the only driver of consumer behaviors with younger populations. One relatively new category of wine that is gaining popularity falls within the natural, organic wine sector. This subset of wine has a growing interest that outweighs more traditional types as it fits within the buying interests of today’s majority consumers.
As younger consumers start to enter the market on a larger scale, businesses will gain a clearer picture of what is to come and what will be required for success in the evolving wine industry and all its different facets. Initial trends show that there will be different interests and buying patterns which will force many to change their strategy and ultimately require change throughout the industry.