Hey everyone, welcome back.
Now we like to get into the weeds here,
so today we are going deep on some really interesting
trends in the wine world.
Yeah, it's a great time to be talking about this.
You know, we've got this new report
from the SVB Wine Division.
Oh yeah.
Their annual direct to consumer report.
And there was also this panel discussion
with some real experts, you know,
folks actually in the industry.
Right, no, that's perfect,
because we want to know what's really going on.
Absolutely.
So what I'm seeing here,
and tell me if you're seeing the same thing,
the report paints this picture.
Yeah.
Almost like a tale of two different wine industries, right?
Totally.
You've got your premium wineries,
the ones that, you know, $12 and up a bottle.
They seem to be doing okay.
Right.
But then everyone else,
everyone under that $11 mark, it's a little...
It's a little dicey.
The data in the report, it really highlights that.
So you see these, you know, really high inventory levels
right across the board,
the whole alcohol beverage industry.
Wow.
It suggests, you know, maybe people aren't buying as much.
Things are slowing down a little bit.
Exactly.
Yeah.
But, and this is key,
when you zero in on the premium wines, you know, at retail,
things are actually pretty balanced.
Interesting.
Like those bottles, they're moving.
Okay.
So it's really about, like you said,
two different segments within the...
It's such a good point.
Yeah.
Because wineries really need to know where they fit in.
Absolutely.
Like what is my strategy?
100%.
You gotta play to your strengths, right?
And speaking of, you know, finding your lane,
remember when Napa was the spot?
Like everybody was going to Napa.
Oh yeah, it was like the place to be.
I mean, they were getting more visitors than Disneyland.
I remember that.
It was crazy.
But it seems like those days, maybe, you know?
Yeah.
Are people falling out of love with wine country?
No, no, no.
I don't think it's that, it's just changing.
Right.
So yeah, overall tasting room visits, they are down.
But, this is interesting, the report,
it actually shows that that decline, it's slowing down.
Okay.
So you know, we could be turning a corner here.
So maybe it's not that people don't wanna go?
Yeah.
They're just being a little more picky,
a little more discerning.
Exactly.
Plus you've got regions, you know, Paso, Santa Barbara,
they're actually seeing more people show up.
Oh, interesting.
So a little bit of a shake up in where people are going.
100%.
But here's where it gets really wild,
even though fewer people are showing up, you know,
at these tasting rooms, the people who are there,
they're spending more.
Really?
So the tasting room purchases are actually up.
Up.
And this, I think, tells you everything,
wineries are getting smarter, you know?
Yeah.
They're focusing on attracting those higher value customers,
even if it means, you know, a few less folks overall.
So quality over quantity.
Quality over quantity.
But, and I don't wanna, you know, kill the mood here,
but we do have to address the elephant in the room,
or should I say, the price tag on the bottle.
Because the report, it does highlight
this pretty significant increase in, well, everything.
Tasting room fees, the cost of the bottles themselves,
even, you know, that whole tipping culture,
it's all going up.
Yeah, and we're not talking about like a small jump either.
No, no, we're talking 21% jump year over year
just for tasting fees.
Wow, that's a lot.
So the question is, I mean, at what point is it too much?
At what point do those higher prices
actually start to scare those customers away?
That is the million dollar question, isn't it?
And it's a tough one, because on the one hand,
you've got wineries, they have costs too, right?
They gotta keep the lights on, but then you've got customers
and yeah, they're willing to spend,
but they also wanna feel like
they're getting their money's worth.
It's a tough balance to strike for sure.
But what about those folks who maybe aren't making it out
to the tasting rooms as much?
You know, I feel like we hear a lot about the importance
of direct to consumer sales, but it seems like a lot
of wineries are still really reliant
on those in-person visits.
It's true, a lot of wineries, they do still lean heavily
on those tasting room sales, but the report,
it really shines a light on this huge missed opportunity,
because guess what?
There are tons of wine lovers out there
who aren't necessarily making a pilgrimage
to wine country every weekend.
Right, and they still want their wine.
Exactly, and they're buying it too.
What's fascinating is that the report actually breaks down
where the biggest spenders for direct to consumer wine are,
and it's not necessarily where you'd think.
Forget the coasts, we're talking about some surprising pockets
of wine enthusiasts all over the place.
Really, so what you're saying is there's a whole world
of wine lovers out there just waiting to be reached.
Exactly, and that's where things get really interesting.
It's not like people are suddenly buying less wine online.
Right, right, exactly, it's more like,
how do you reach those people, right?
Because it's not like the older days
where you could just like put an ad in a magazine
and call it a day.
Yeah, those days are long gone.
Everyone's online now, and it feels like,
I don't know, everyone's shouting,
and it's hard to break through the noise.
100%, it's that whole crowded digital vineyard thing
we were talking about, right?
Wineries really need to step up their digital game
if they want to stand out.
So what does that look like?
Is it just about like having a fancy website
and posting on Instagram every day?
It's definitely more than that.
The experts on that panel, you know,
they were really stressing the importance of personalization.
It's not enough to just like blast out generic emails
or hope for the best on social media.
So what, like sending out handwritten letters
to everyone on your mailing list?
I mean, I love that idea,
but it doesn't seem exactly scalable.
Right, right, no, not handwritten letters,
but you're getting at the heart of it.
It's about using the tools we have, the data,
the technology, to create a more personalized experience.
So instead of those generic email blasts,
think more like targeted campaigns,
based on someone's past purchases.
So if I bought a case of Pinot Noir last month,
you might send me an email about, I don't know,
an upcoming Pinot Noir tasting event.
Exactly, or maybe it's a special offer on a new vintage
or a curated selection of Pinot Noirs
that you might enjoy based on your past purchases.
Okay, now that's smart.
I'd be way more likely to open that email
than something totally random.
Right, it's about speaking to people as individuals,
not just a mass audience.
And the same goes for social media.
So less broadcasting and more like having
actual conversations with people.
Exactly, engaging with comments, responding to messages,
running polls and quizzes, all of that helps
build relationships and creates a sense of community.
Community, I like that.
It's about creating a sense of belonging,
which is something I think people
are really craving these days.
Totally, and speaking of technology,
we can't forget about good old fashioned text messaging.
Oh, you mean SMS marketing?
I've been seeing more and more of that lately.
It might sound a little old school,
but honestly think about it.
People are glued to their phones.
A well crafted text message,
it can be a really powerful way to stay top of mind
and drive those impulse purchases.
So sending out a text like,
hey, your favorite rosé is back in stock.
Exactly, or maybe it's a last minute reminder
about a flash sale or a special offer
just for your VIP customers.
The key is to be strategic
and not bombard people with messages.
Right, nobody wants to be spammed,
even if it is with amazing wine deals.
But this is all starting to sound
a little overwhelming to be honest.
How are wineries supposed to manage all of this?
The personalized emails, the social media,
the text messaging on top of actually making
and selling wine.
That's where things get really interesting.
Remember how we were talking about
artificial intelligence earlier?
How some wineries are starting to experiment with AI?
Yeah, like those robot sommeliers
taking over tasting rooms.
I'm not sure I'm ready for that.
Huh, not quite.
But AI can be a really powerful tool for wineries
looking to up their digital marketing game.
Think about it.
AI can analyze massive amounts of data
and identify patterns that would take a human marketer
hours, days, maybe even weeks to uncover.
So AI could help wineries figure out
what kind of wines people are searching for online
or what time of day is best to send out those text messages.
Exactly, it can help wineries
personalize those email campaigns,
optimize their social media content,
even craft more targeted SMS messages.
Wow, so AI isn't just about robots.
It's about like working smarter, not harder.
Exactly.
But, and this is a big but,
the report also emphasizes that AI is just a tool.
It's only as good as the people using it.
So it's not like wineries can just set it and forget it.
Exactly, they need to be thoughtful
about how they integrate AI into their overall strategy.
They need to ask the right questions,
understand the limitations,
and most importantly, make sure they're using AI
ethically and responsibly.
It's not about replacing human connection.
It's about enhancing it.
100%, and that brings us back to that idea of community
and building relationships with your customers
because at the end of the day,
people buy from people they like and trust,
whether it's online or offline.
It's all about building those relationships,
those connections that go beyond just a transaction.
Now, what about those wine clubs
we were talking about earlier?
It seems like there's been a lot of talk lately
about declining wine club memberships.
Are people just not as into them as they used to be?
It's interesting, right, because on the one hand,
you have this whole movement
toward personalization, customization, experiences,
and then on the other hand, you have wine clubs,
which can sometimes feel a little, I don't know, impersonal.
Like, here's a discount, buy our wine.
Exactly, and that might have worked in the past,
but today's consumer, they're looking for more.
They wanna feel seen, they wanna feel valued,
they wanna feel like they're part of something special.
So are wine clubs doomed?
Are they getting to go the way of, like,
fax machines and phone booths?
Yeah, I don't think so.
Wine clubs still have a lot to offer,
but they definitely need to evolve to stay relevant.
It's not enough to just offer a discount and call it a day.
Wineries need to think about how they can create
a wine club experience that's truly engaging, valuable,
and tailored to the needs of their members.
So what does that look like in practice?
Give me some examples.
Well, we're seeing a lot of wineries experiment
with different formats, like virtual tasting items
hosted by the winemaker or guest experts.
Oh, that's fun, I'd love to do that from my couch.
Exactly, it's a way to bring people together,
even if they're geographically dispersed,
and create that sense of community.
It's like that old cheer song,
sometimes you wanna go where everybody knows your name.
Exactly, and wineries are getting really creative
with the perks they're offering,
exclusive access to limited edition wines,
early release notifications,
personalized wine recommendations
based on your taste profile.
Okay, now you're speaking my language.
I love that idea of getting
personalized wine recommendations.
It's like having your own personal sommelier on call.
Right, it's all about making people feel special,
like they're getting something
they couldn't get anywhere else.
It's about adding that extra touch, that personal touch,
that makes all the difference.
So what's the secret sauce?
How do wineries create a wine club experience
that really resonates with people?
I think it all comes back to data,
and really understanding your customer.
Wineries need to use data to understand
who their members are, what they value,
how they want to engage,
and then use that information to create an experience
that feels personalized, engaging,
and ultimately worth the investment.
It's about building a community,
a tribe of passionate wine lovers
who feel connected to the winery and to each other.
Couldn't agree more.
It's about creating an experience
that goes beyond just the wine itself.
It's about fostering those relationships,
building that loyalty that will last a lifetime.
It really feels like that's the common thread here.
No matter what aspect of the industry we're talking about,
it always seems to come back
to that idea of building relationships.
100%, you hit the nail on the head.
It's like, yeah, the wine industry's changing,
things are shifting, but those core values,
connection, community, they're more important than ever.
Absolutely.
It's about creating an experience,
both for those diehard wine enthusiasts
and for those folks who are just starting to dip their toes
into the wonderful world of wine.
Totally.
And you know what?
I think those wineries that are really gonna thrive,
they're the ones who are willing to really lean into that,
the ones who are willing to take risks,
to try new things,
to really listen to what their customers want.
It's about being brave enough to reimagine
what the wine experience can be.
It's not just about what's in the bottle.
100%, it's the whole package.
It's the story, the experience, the connection,
and it's about creating those aha moments for people,
the ones they'll remember long after that last sip.
It's like you always say,
we're in the business of memories, not just wine.
And on that note, I think it's time to wrap things up.
Cheers to that.
Cheers.
A huge thank you to everyone for joining us
for another Deep Dive.
We hope you learned a thing or two,
maybe uncorked some new ideas,
and most importantly, that you're feeling inspired
to go out there and explore the world of wine
with a fresh perspective.
Until next time, happy sipping.