Segmentation of UK regular wine drinkers
- Adventurous Connoisseurs are middle-aged confident wine drinkers who enjoy experimenting within their wine lives (18% of total spend on wine in the UK)
- Generation Treaters are younger drinkers (Gen Y aged 29-39) who are growing in confidence and experimenting in their wine choice (24% of total spend on wine in the UK)
- Mainstream at-Homers are middle aged core wine drinkers who view their wine drinking as a frequent treat (22% of total spend on wine in the UK)
- Risk-averse Youngsters (Gen Y aged 18-28) are younger wine drinkers lacking in confidence and still growing into the wine category (19% of total spend on wine in the UK)
- Senior Sippers are older, less frequent wine drinkers with a limited interest in wine (12% of total spend on wine in the UK)
- Kitchen Casuals are middle-aged and infrequent wine drinkers, who are typically unengaged with the category (5% of total spend on wine in the UK)
- Source: Wine Intelligence Portraits UK 2014.
Our Target Market is the millennial Generation Y: Risk-averse youngsters and Generation Treaters.
This category has been ignored by the wine industry in general. Other drinks categories have done a much better job engaging with Millennials. They are a big target market for craft brewers.
A survey was recently conducted in Ireland and the UK which asked Millennials to select words which describe the essence of food and drinks brands they choose to purchase. The words selected include: attractive, dependable, loved, competitive, trustworthy, accessible, influential, valuable, enjoyable. The survey resulted in a marketing study which suggested that Millennials are using brands as a proxy to express who they are, and the words selected were actually indicative of how Millennials themselves wanted to be perceived. Young people are engulfed in a visual culture and deeply entrenched in using social media to tell their story. The study refers to this as “storyful living” and suggests food and drink makers can court Millennial customers by providing a product interesting enough for them to snapchat or tweet about. For these young people “food is fashion” and purchasing rare artisan foods and drinks is both glamorous and meaningful.
Almost two thirds of Millennials want to quit the 9 to 5 and create their own business. This internal drive to break out is referred to as having an “entrepreneurial mindset.” The dream is to have the freedom to build one’s own life, work on things that are interesting, and schedule where and when one works. When Millennials choose to purchase products from small artisan producers they are supporting others who share that same entrepreneurial mindset – in short, that purchase gives meaning to the customer’s own life, and proves that
the little guy really can make it.
When drink makers want to tap into the Millennial market they must have a clear strategy about the values its brand portrays. If young people choose products with attributes they desire for themselves, brands will do best to exude independence and freedom, while still
caring deeply for the world and the environment.
Story telling is the key to displaying a brand’s values – values that the customer takes on when they purchase the product.
Market research and insights above are from Wave Train Intermedia included in a blog by Sara Breitenfeldt, Secretary of Beer Ireland, a professional association for Irish craft brewers, and is a member of the Pink Boots Society. The UK Wine market is worth £10 billion in sales (WSTA Market Overview 2015 Edition)
It is important to spread risk and to be present in all trading channels each offering unique opportunities and threats. To be too reliant on a single channel is to relinquish control of the brand and can lead to downward pressure on price or worse can lead to a quick exit from the market with the single threat of a de-list.
UK Off Trade: The majority of wine in the UK is purchased in the Multiple Grocers with the off trade accounting for 81.7% of purchases (Source: Nielson)
National Accounts: Waitrose has the highest profile in terms of the target consumer for premium wines. Establishing a brand in Waitrose is extremely positive and is the first step in broadening distribution into Tesco’s, Sainsbury’s or the Cooperative. National Multiple Specialist, Majestic Wine, is another key target.
Regional specialists: the UK market has become polarised with price and value for money being the key motivation in the volume grocer outlets and in the specialist sectors consumers are looking for something a bit different. This sector including merchants such as Vagabond wines in London experiencing solid growth “with many independent merchants enjoying their best ever years.” (Source: Harpers Wines & Spirits).
Regional non-specialists: Another area experiencing growth is specialist delis and food outlets. This sector is not wine specialist and they want a small list of wines that complement their foods and that are easy for their customers to understand. Harlington decode the complicated and put their wine styles together using colour, making it easy for their non-specialist customers to recommend wines to partner their best selling foods.
UK On Trade:The on trade has experienced difficulties as many consumers have opted for “the big night in” inviting friends to dinner and enjoying quality wines at home. However, well-located destination and neighbourhood restaurants and bars are doing better. The Gastro Pub
sector has also experienced solid growth.
Wholesale: The National wholesale channel is going through some changes at the moment with Constellation Brands having sold 80% of their UK and Australian operation to Champ Private Equity. Price will be a key driver to these huge distributors whose aim is to reduce their portfolios. Harlington can differentiate so there should be interest in their niche wines filling important gaps for major National Wholesalers.
National Direct: Another difficult sector but brand activation is what drives this division, so with the right messages, a listing could be possible with a major group such as Mitchells and Butlers (large portfolio of on trade branded pubs – such as All Bar One and outlets)
Regional (independent): The independent sector is fairly buoyant but price is being squeezed with even top quality award winning outlets wanting to make 350% mark-up on wine. This means a £14 bottle of wine on the list costs £3.50 wholesale (€0.75 ex cellars
equivalent to the importer)! Quality outlets such as The Green Café in Ludlow are clear
UK Consumer Direct: It is clear that with the fragile market conditions price and therefore margins are being squeezed significantly in all the BtoB channels. The BtoC channels are opening up and growing solidly all be it from a very small base. Not many importers are taking advantage
of this as routes to market are very traditional and old fashioned in the UK. This channel is therefore a major opportunity for Harlington.
Regional Events: Trailblazing Wine hold tastings in regions across the UK. These are a very important marketing aid for spreading the influence of the brand across the UK as a whole. It offers the consumer the opportunity of a direct link with the winemaker.
Internet: Offers huge growth potential both in e commerce sales and to engage directly with the customer. It is critical in this burgeoning sector to keep ahead of the competition by investing in state of the art e-commerce and App technology and skilled web site maintenance and by using social networks to best advantage. The Internet and app channel is dominated by two players in the Wine Club and new to market Information sectors.