Selling wine to Generation-Y

South Africa is the ninth biggest wine producing country in the world, but per capita wine consumption is much lower compared to consumption trends in traditional wine producing countries.

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Industry leaders at the recent Wineland Seminar in Stellenbosch said local wine sales could benefit from more efficient marketing, especially that which targeted the younger generation of wine drinkers.

Rico Basson, executive director of Vinpro, said that, at 6,9l/year, SA was the wine producing country with the lowest per capita consumption of wine. In countries like Portugal, Italy and France, per capita consumption of wine was more than 35l per year.

Basson said that in SA wine producers faced much competition from other alcoholic beverage categories like beer. The per capita consumption of beer is close to 60l/ year. And beer holds a 57% market share for alcoholic beverages.

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According to Basson, over the past decade the ready-to-drink category’s market share increased from 4,3% of all alcoholic beverages sold to around 9%, while wine’s share decreased from 7,19% to 6,97%.

Wines of South Africa (WOSA) CEO Shiobhan Thompson said wine producers needed a clear vision for their brands as a starting point for more effective marketing.

“We work in a market where products can be very similar to each other, therefore it is crucial to find your unique and strong consumer proposition,” said Thompson.

Wine producers, she added, often failed to put enough time into developing a proper marketing and brand building strategy.

“Analyse your target market and ensure your marketing strategy is appropriately tailored to the consumers you hope to target.”

The consumer group that represented the most opportunity for growth in the wine market was ‘Generation-Y’, individuals born between 1981 and 1995.

Dr Marie-Luce Kühn, business analyst at business and information services company IBIS, said Generation-Y was the largest generation in SA, representing 20%, or about five million people of the population, and had massive spending power.

She said research had shown that over 72% of this consumer group drank alcoholic beverages, with wine accounting for 20% of all alcoholic beverages consumed by it.

“To target this consumer group through marketing you need to understand how they are different and what motivates their buying choice,” said Kühn.

She said Generation-Y is defined as being “techno savvy, connected 24/7, optimistic, confident, comfortably self-reliant, entrepreneurial, success driven, inclusive and environmentally minded. Digital media impacts their buying decisions”.

“Players in the alcoholic beverage sector need to follow Generation-Y to social networks and establish and maintain a significant social media presence.”

Kühn also noted that this group often preferred to make purchases via online retailers, so it was important to offer it this service.