How to engage Millennials with the wine category

The Challenge

Whether you speak to people working in the wine or hospitality industry or read business reports, the combination wine and Millennials doesn’t trigger many positive outlooks. Although the perspectives on the assumed causes differ, the impression that this generation has so far not engaged with wine as much as hoped is shared by many. As Millennials were expected to become the biggest wine-consuming group within 5-10 years the wine industry is rightly worried.

Some separate research studies have suggested that the Millennials show greater interest in the so-called ‘experience economy’ rather than in simply purchasing at retail. Other studies stated that Millennials are seeking differentiation, are more willing to experiment and are open to innovative products and concepts.

So about time for some good news about the combination Millennials and wine: the self exploring wine bar concept attracts hordes of Millennials throughout Europe!

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What do you mean millennials are not interested in wine? They spend up to 30% more per glass versus a “normal wine bar”. And that's not all! They also spend up to 65% more compared to a mid range restaurant or bar.

This article will tell you a bit more about the concept but will especially focus on explaining how you can get involved yourself.

The Concept

The concept is based on the self exploring of 80 to 150 open wines by the guests in a casual setting. To be able to start the “wine discovery trip”, guests buy and charge a card. When inserted in one of the wine dispensers in the bar, the card enables the guest to dispense a taster, half glass or full glass of wine by themselves. Of course there is staff around to provide advice and information and to serve food and other drinks.

Researchers would probably be interested to study the elements which make this concept so attractive separately. Is it the magic number of 100 wines? The casual setting? The fact that guests can dispense wines themselves? The price transparency? The availability of tasters and half glasses? We rather focus our energy on making the concept available to much more wine drinkers with a clear focus on Millennials (median age 30). With 2000 to 5000 unique guests per year per bar, applying the concept on a bigger scale will have a significant impact.

Important note: we don’t believe in franchise or even in a national brand. We believe in local adaptations of the central idea behind the concept. So elements like size and the interpretation of food and other beverages can differ as long as the key elements of the concept are kept in place.

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Creating permanent impact

Although attempts to create a world wide “Coca-Cola for the wine category” have miserably failed, part of the wine suppliers and most of the retailers use a strategy which leads to commoditization. Especially the continuous stream of very deep cut-price promotions is encouraging consumers to limit themselves to a limited set of brands and grapes. It’s easy to understand that the whole wine industry with the exception of a few big players will suffer from this strategy.

To counter the commoditization smart solutions are required. Unfortunately a lot of well-meant initiatives lack a key component limiting it’s impact. Increasing the knowledge of wine drinkers will certainly help, but wine courses usually only last a few weeks. Supply chain initiatives, including cooperations on the production side, to enable smaller wineries to bring their wines to the market usually lack the last step: bars and/or stores where wines and consumers come together. So they still have to “negotiate” their way into the market putting the wineries and the importers in a vulnerable position.

So we believe it would be helpful for most wine importers to have a “tool” which creates a real impact, can be tailored to represent the own identity and guarantees direct results for the short and longer term. In our opinion the self exploring wine bar concept can be this tool.

How to get organised

So do we recommend wine importers to change their whole strategy and start a small chain of self exploring wine bars? No, in general we don’t. However, we do strongly advise wine importers to get involved to initiate or support the set up of much more of these wine bars!

Let’s look at the key elements to operate a wine bar successfully and define what role a wine importer can play! The key elements needed:

  • A good hospitality entrepreneur
  • A (proven) concept
  • An attractive wine assortment
  • Funding
  • Right location
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By experience we know these ingredients can be organised for most European cities rather easily if you know how and if someone is willing to take the initiative. We believe the wine importer is in a very good position to act as the initiator and catalyst for this process with our help. The support we can offer includes:

  • Search a good hospitality entrepreneur based on criteria we define together
  • Tell you everything we know about the concept so you and the hospitality entrepreneur can create your own version of it. Alternatively we can put you in contact with existing small chains looking for expansion
  • Examples of different options for funding including leasing, investors, crowd funding etc
  • Advice regarding the location or a joint search for the right location

So what does this bring you as a wine importer:

  • A position as the sole or at least main supplier of a wine bar which will sell between 10.000 and 25.000 bottles of mostly fine wines per year
  • A stage to present your wines to the biggest consumer group of the near future (Millennials)
  • Possibly a share in the wine bar (depending on the deal you make with the hospitality entrepreneur)
  • Some financial risk: to “earn” your position as sole or main supplier coming up with the idea will probably not be enough. This can be done in many different ways depending on what suits you and the hospitality entrepreneur best. Of course we’ll help you to limit the risk.
  • Incredible insights regarding your wines as the transaction data will give you insight in things like trial, conversion, loyalty and of course overall volume.

We understand completely that this is a rather unconventional approach for a wine importer. The wine importers who have preceded you are all very happy with the unique position it has put them in, creating long term relationships with hospitality entrepreneurs in the most interesting segment of the market.

Contact us if you want to learn more about becoming the main supplier of a successful wine bar concept.

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