What the Progress in Automotive Headlights has to tell us about Choosing which Grapes to Grow in the Midwest

The headlights on nascent automobiles were first seen in the 1880s . Similar to those which had preceded them on the railroad, these acetylene oil lanterns provided 50 feet, or so, of visibility.

With a vehicle chugging along at 25 miles per hour that 50 feet ahead of him provided the driver approximately 1.36 seconds of visibility ahead.

Fast forward into the modern era and low-beam headlights now provide about 160 feet of visibility. With the vehicle travelling at 65 miles per hour the driver has approximately 1.46 seconds of visibility ahead.

Not much has changed.

In over one hundred years of automotive engineering we have improved the ability to the driver to see the road ahead, and react to changes ahead, by one-tenth of a second.

So, has your ability to peer into the foggy road of wine improved?

Growing grapes and its first derivative, wine making, requires the ability to see into the future.

In the recent past, those in agriculture would receive insight from those with technical expertise: the sort of expertise which would say to grow this and to not grow that.

The answer today is increasingly to be found by the interactions with your customers and continuously collecting information. On a daily basis your customers will tell you what they like and what they don’t like with their purchases. Consider:

Social Networking. This is THE way to engage with the millennials. If you are not on Facebook and Twitter on a daily basis you are missing an important avenue to connect with these new wine consumers.

Direct to Consumer Sales. Most wineries think about sales only and staff the tasting room with less than knowlegable staff. Granted: Sales from the tasting room are the way to open the door for interactions with the consumer. Think of this critical face-to-face meeting as your single greatest opportunity to create a life-long customer. But you don't always sell, and if you don't sell you should not pass up this opportunity to gain some insight. Consider collecting one piece of information from each visitor.

Wine Clubs. Once signed up, wine club members retain membership on average for two years. Think: two bottles per month for twenty four months.

Bottom line: Merely keeping up with the competition is not sufficient if you are to grow your business. An aggressive set of strategies is required to connect with, gather information from, and make sales to your customers.

Choosing Wine & Sales

Brad Post:

After reading my brothers remarks on restaurant patron wine purchase choices I began to do some research to see how people go about selecting a wine and reviewed current sales trends. The source of my material comes from Wine Business Monthly (April & May issues).

Wine sales over the past year (and the past 13 weeks - ending 2/7/09), according to the Nielson Company, and reported by Rachel Nichols (WBM, p. 71, May, 2009) indicates overall wine sales are up by 5 percent.

Any guesses to the top selling varietals? The dollar volume for the past 52 weeks follow: #1 Chardonnay - $1.7 billion, #2 Cab Sauv. - $1.18 billion, #3 Merlot - $898 million, #4 Pinot Grigio/Gris - $649 million.

The fastest growing segment over the past year are: #1 Pinot Noir (13.2%), #2 Fume/Sauvignon Blanc (10.4%), and #3 Pinot Grigio/Gris (9.7%). It is interesting to note, despite such a large market share, that Chardonnay and Cabernet Sauvignon are still making headway reporting moderate growth over the same period: 4.1% and 7.7% respectively.

That is a lot of wine being purchased - Billions of dollars! So, how do winemakers go about marketing their product so it moves? What do potential customers key-in on before they buy that one bottle (or case)? Using experimental research, Larry Lockshin, professor of Wine Marketing at the University of South Australia (WBM, p. 64-67, Apr. 2009), reported two studies. The first being critical of traditional market research methodologies, which simply asks customers to pick their favorite attributes of a wine (e.g., bottle design, label, etc.), and in this study he created a simulation and manipulated the label colors and styles. He found label style and colors were predictive of purchase behavior - but varied by respondents.

Study 2. In this study, he experimental manipulated several independent variables (e.g., bottle size, label design, color, price, ratings, awards, alcohol level, and closure type) to understand their effect on the dependent variable: choice. Biggest purchase predictors? 1) ratings (0-5 stars), 2) brand, 3) price, 4) medals and trophies, 5) price discounts, 6) alcohol level, 7) region, and 8) closure type. For online purchases price seems to be even more important!

Take home message to us: get Robert Parker to highly evaluate our wines, build a strong brand image, and price it right!

Happy tastings!
~Brad