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Are millennials really your target market?

2012 April 24

The economy is making a slow recovery. How do I know? Well, it’s certainly not because I have clients lining up with work for me. I personally have seen few signs of growth and the number of lease signs I see in local strip malls would suggest otherwise.

But a recent poll by the NPD Group shows that sales of luxury items, such as motorhomes and rounds of golf, have started to rebound. Even spending on things as mundane as underwear, which, according to Alan Greenspan, is an indicator of consumer spending on staple items, has increased 6.6% in the past year. That could mean people are no longer penny-pinching. I guess if you didn’t have much disposable income and you had a choice between new underwear and paying the rent, the latter would prevail.

However, this little bit of good news hasn’t reached all age groups, especially the millennials—those 18 to 34 year olds that seem to be the target group for nearly every marketing campaign. Recovery hasn’t been as significant for this group. Unemployment figures for the past 5 years show that unemployment in 18 to 24 years olds has increased proportionately faster than other age groups, leaving only 54% with a job. And without a job, they have no money to spend on your products. That fact alone should give you pause. Is this the group that your marketing dollars should be targeting?


“If [young adults] have no money in their pockets,there is nothing to sell them,” says Sunil Gupta of the Harvard Business School. He points out that wealthy baby-boomers on the verge of retirement are where you should set your sights.

And why not? Older, more well-established wine drinkers are probably the ones who are still in your wine club, even after a tough recession. Their loyalty is not as fickle and they aren’t as easily distracted by the new and shiny winery that just opened down the road from you. They’re more likely to have homes with cellars, but that may work against you since they will probably only buy minimum amounts and almost never purchase a full case of any particular wine. That’s because they already have plenty of long-term holdings, so they’re really more interested in wines for everyday consumption—whites, rosés and ready-to-drink red wines. That doesn’t mean they no longer buy cellar-worthy wines; just not as much. Boomers are more likely to know from past experience that having too much of a wine that could change in several years doesn’t make much sense. Personal tastes change and they don’t want to have cases of wine they no longer enjoy.

So how do you appeal to these older wine consumers? Here are a few suggestions:

  1. First, recognize their needs. They need something they can drink now, not 10 years from now. Produce and push drinkable wines, but let them know you also have wines that age gracefully. How? Exclusive library tastings to show how well your wines hold up. Just remember to hold back a few bottles of each vintage for this purpose.
  2. Make it easy for them to get what they want. For instance, offer mixed-case and half-case discounts so consumers don’t have to commit to more than 3 or 4 bottles of any particular wine, yet still feel like they got a good deal. Older wine consumers want to be able to drink their wines, not have their kids inherit them.
  3. Reward their loyalty. You’re not the only winery around and both you and the consumer know that. Yet, there must have been something you offered that appealed to them initially. Find out what that was and capitalize on it. Other rewards could include loyalty points programs, discounted shipping for far-away members, and exclusive members-only events for locals.
  4. Use social networks. Boomers are the fastest growing group on social media. Make sure your presence is where they are online. A Facebook page is a given, but make sure you’re also using location-based and rating apps such as Yelp, Foursquare and Wine Wherever. Tie these apps to your loyalty program to make them even more effective.
  5. Lastly, recognize that with age comes experience. Make sure your staff are equally knowledgable and can answer questions boomers may have, from technical aspects of the wine to what kind of foods pair with it. There are few things more frustrating for a wine drinker than talking to a tasting room employee who knows less than you about the wine they’re serving.

These suggestions aren’t just for your older customers. Millennials may be down, but they’re not out. (Though I’d hate to see their underwear) They’re still the next generation of wine drinkers and your marketing plans shouldn’t ignore them just because they can’t afford your wine right now. As the economy continues to improve, so should the millennial buying habits. Make sure they don’t feel left out in the interim.

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2 Responses leave one →
  1. April 24, 2012

    Nice thoughtful post, Eric. I like your encouragement to reward customer loyalty. I think too many wine businesses offer discounts to attract new customers, yet it’s more practical to retain current customers. Also, it seems that far too few wine businesses are taking advantage of social networks. I hope this encourages people in the industry to rethink things.

  2. Eric Hwang permalink*
    April 24, 2012

    Thanks for your comments. I’m encouraged to see that many wineries are already onboard the social media train and I hope others will eventually see the long-term benefit of social marketing. And yes, while it costs three times more to attract a new customer than to retain an existing one, too many wineries have forgotten to reward loyalty.

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