The new Silicon Valley Bank “State of the Wine Industry 2015” report is 56 pages long.
I read through every one of them, and by far the most interesting statement was this: “Millennials have yet to make a dent in the fine wine business. So why the difference between the media reports and reality?”
Wow. Tell it like it is, bankerman! As the report noted, “[One] might expect to find the tee totaling Boomers in rocking chairs with the Millennials at the head of the table. But despite the hype, that hasn’t come even close to happening.”
First, a little context. You’ve heard it, I’ve heard it, everybody’s heard for years: Millennials rule the roost when it comes to wine. From Fox Business News: “The face behind the wine glass is looking a lot younger. The Millennial generation, which includes the youngest legal drinkers, is consuming more wine than previous generations when they turned 21, and the industry is taking note.”
From the online PopDust: “Millennials Are Drinking So Much Wine They’re Changing How It’s Sold.”
And this, from Medical Daily.com: “Millennials have been driving the wine consumption increase up drastically,..[this is the] ‘Gen Wine’ phenomenon happening right now in this country.”
Well, I could go on and on, thanks to the Google machine, but you get the idea. So why is Silicon Valley Bank saying that, when it comes to sales, Millennials haven’t done diddly?
I have my own ideas concerning that “difference between media reports and reality.” What?!? You mean there’s a gap between what the media report and the real world? I’m sure we’re all shocked, shocked. My take on this dissonance is that there is a lot of me-tooism, cut-and-paste writing, lazy journalism and wishful thinking. That’s a recipe for “Bad Reporter” every time.
But what does Silicon Valley Bank itself have to say by way of explanation?
Well, first of all, they point out they’re only talking about “fine wine.” It’s not clear from the report just how they define “fine wine,” but I think it’s most of the wine you and I care about. I guess it’s not jugs or Two-Buck Chuck, and it may even be wines above $20 the bottle: “Starting in mid-2014,” the report says, “wines priced above $20 a bottle broke out strongly higher,” following the Recovery that kicked in after the horrible Great Recession. Most Millennials don’t have that kind of money to spend on wine, saddled as they are with debt.
What will it take for Millennials to finally be able to afford to drink better? Here’s a one-word answer: Time. “One day,” the SVB report says, “Millennials will be at the center of fine wine sales. But”—and it’s a big but—“the reality is—no matter what a generation is called, the most active buyers of fine wine…will continue to be in the 35- to 55-year age group.”
I’ve been saying this for years and gotten my share of bashing for seeming to dismiss the importance of Millennials. Nonsense. It just stands to reason that when you’re 26, have $100,000 in student loans and other debts, and aren’t making all that much to begin with, you’re not going to be dropping $20 and up for that nightly bottle of wine. (A bottle a night? Well, yes, for you and your sweetie/roommate/whatever.)
Now, onto social media! We know that Millennials are obsessed with it, and we know that older people aren’t (except for Facebook). How to explain that? Is it because old people never “get” new-fangled ways of communication? Or is it that there’s something fundamentally adolescent about social media that older people find, well, kind of immature? If it’s the latter, then you have to wonder if today’s social media-addicted Millennial will still be tweeting and instagramming and pinteresting etc. 24/7 when they’re 50 years old. Or will they look ruefully back, with a wry smile, and say, “I can’t believe I was that hooked on my iPhone back then”?
Well, we can’t know without a crystal ball, which I don’t happen to have. But I can’t help but feel that when today’s Millennials get older and have more money they’re going to look and feel more like their parents than they look and feel today. Aging has a way of doing that: You become your mother or father and discover that it’s not as horrible as you thought it would be.
And then there’s this, just in: “Where do tech-savvy Millennials buy wine?” asks the Tribune, out of San Luis Obispo? It answers its own question: “Not online, Cal Poly study finds.”
It turns out that, when it comes to actually buying a bottle of wine, our Millennial friends go to “the grocery store”! Same as their parents and grandparents, a finding the university’s V&E head called “surprising.” Well, life’s full of surprises, isn’t it?
What does this have to do with wine sales in America? The SVB report contains all sorts of interesting things: one of the more troubling aspects for American wine is the increased interest people have in foreign wines, which are cheaper because of the strong dollar, which will probably continue to be strong for quite some time. But it also suggests that these modern Millennials, who are so adventurous and experimental and fickle in their loyalties today, will become more loyal to brands in the future, provided that those brands give them something to be loyal about: good stories, good quality wine, fair pricing, because older consumers do tend to be more loyal (or, you could say, more conservative) to particular brands. This is what wineries should be focusing on now: Not obsessing over social media, in all its evanescent particulars, but laying down solid, well-thought-out plans for the next twenty years.
Three articles in yesterday’s S.F. Chronicle caught my attention for the suggestions they make about how social media is, and is not, changing our lives.
(I was finally able to read after days of not being able to, due to the intense flu I had. It was an effort just to focus my eyeballs.)
The first article was on the continuing war between digital cab companies, like Uber and Lyft, and conventional taxi companies. This is a topic San Franciscans have been hearing a lot about. The bottom line is that the conventional taxis were slow to the point of paralysis in understanding the implications of portable digital devices. This was summed up by a CEO who said, “The taxi industry needs to rapidly retool and face the realities of the smartphone.”
Nobody is going to dial up a taxicab number and face all the possible uncertainties and hassles. (Just finding an open taxicab in San Francisco is a feat.) So much easier to establish an Uber or Lyft account, even if it means paying a little more. Uber and Lyft made the news yesterday because they apparently are planning on price-gouging on New Year’s Eve, but that’s beside the point. The point is that they foresaw the conveniences of smartphones and the taxi companies didn’t.
The second article was an examination of one of the East Bay’s new congressman, Eric Swalwell, the youngest member (at 32) of the large California delegation. Swalwell’s a social media guy; he made a point of stressing that in his interview. He tweets so much that there’s a new Twitter hashtag, #swalwelling, which seems to consist of photographing one’s feet as they enter an airplane. (We have “selfies.” Could this be “footsies”?)
These two articles represent green lights for social media. They underscore that we have become a society on the go, go, go, with our feet carrying us while our hands clutch our smartphones and we share our experiences with others. We interact with the world through these devices, and that includes all our interactions: shopping, politics, entertainment, simple personal communications. For wineries, the meaning is clear: Go big, or go home. The winery that does not learn how to take advantage – no, that’s not the right phrase, because it implies a certain cynical, transparently venal misappropriation of social media. Let me start again. The winery that does not learn how to communicate through mobile devices puts itself at disadvantage in this hyper-competitive world. Just as taxi companies learned, to their chagrin, at the hands of Uber and Lyft, the future belongs to the digitally savvy. (Although I will admit that Uber and Lyft have not been particularly adroit in handling the politics of their situations. But that’s another story…).
The third article stands in stark contrast to the others. There’s a new establishment here in Oakland, Plank, down at Jack London Square. It’s in a gigantic space that’s been vacant for years. The new owners decided to open, not just a restaurant, not just a bar, but a bowling alley, pool hall, bocce ball court and video game arcade. They call it an “activity bar.” The concept is, as another activity bar owner put it, “It’s fun, and you don’t have the pressure of sitting across the table talking for three hours.”
Well, I don’t know about the “pressure” of talking with friends and family over a restaurant meal. I mean, if it were really that onerous, people wouldn’t be doing it so much. Still, I get the idea. As the Chronicle reporter who wrote the story mused, “One wonders …whether these bars satisfy a longing for childhood pleasures…in the age of texting, with face-to-face communication.”
That’s more to the point. Yes, we inhabit a digital reality; we’re all nexuses on the World Wide Web. We do more and more things with our smartphones. But my discomfort from the very beginnings of this digital revolution has been connected with the fact that it somehow seems injurious to the social and civil underpinnings that made us human in the first place, and societal beings moreover. To that extent, the phrase “social media” is an oxymoron. “Social” is face-to-face; distant communication, however facile or amusing it may be, is not particularly social.
However, here we are, on a cusp as it were between two opposing forces. As usual with cusps (such as the transition between millennia), predictions, fears and hopes are exaggerated; things continue more or less as usual. Life goes on; we grow accustomed to whatever is new, and somehow manage to keep hold of our humanness.
The lesson, again, for wineries, which I alluded to above, is clear: adapt to the digital, portable realm or be doomed. But do it in a way that’s Zen-like in detachment: with a pure mind, as Buddhists put it. Do not allow yourself to be perceived as having an ulterior motive; in fact, do not have an ulterior motive, except that of humanness. If you’re puzzled by how to achieve this, here’s a clue: If you are yourself, not someone else, you will not be perceived as having an ulterior motive. If you are not yourself, you invariably will be. It’s a strange paradox: by being real, you will succeed. If you don’t know what being yourself and being real mean, then you have your work cut out for you.
Anyhow, have a fine, fun and safe New Year’s Eve! No drunk driving, please.
I gave a talk last night to the Sonoma County Wine Library on “what makes a wine book for the ages.” That’s a rather august topic, and it made me compose a list of the books in my own wine library (which is very substantial) that I have enjoyed a great deal. Here’s the list. As you can see, I prefer older books: newer ones seem more slapdash, and the writing certainly leaves something to be desired.
- Notes on a Cellar-Book, George Saintsbury, 1934.
- Wines, Julian Street, 1948
- The Complete Wine Book, Frank Schoonmaker and Tom Marvel, 1934
- Also their American Wines, 1941
- Hugh Jonhson’s Story of Wine, 1989
- The Romance of Wine, H. Warner Allen, 1932
- All of Harry Waugh’s Wine Diaries, 1960s-1970s-1980s
- The Wines of Bordeaux, Edmund Penning-Rowsell, 1969
- ABC of America’s Wines, Mary Frost Mabon, 1942
- Drink, Andre Simon, 1953
- Gerald Asher’s Gourmet articles, reprinted in soft cover
- I came up on Bob Thompson’s “Pocket Encyclopedia of California Wines” and Olken, Singer & Roby’s “Connoisseurs’ Handbook of California Wines”
- Alexis Lichine’s New Encyclopedia of Wines & Spirits, 1981
- The World Atlas of Wine, Hugh Johnson, 1977 edition
- Great Winemakers of California, Robert Benson, 1977
- Wine Winemakers Dance: Exploring Terroir in Napa Valley, Swinchatt & Howell, 2004
- The Wines of America, Leon Adams, 1973