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Marketing Wine to Generation X: The Great Oxymoron
The following wake-up call was delivered on Aug 1, 1996, by Darryl M. Roberts at the Society of Wine Educators' annual conference in Portland, Oregon.

INTRODUCTION:

Fact: Every year in the United States 3.5 million people turn 21 years old -- the legal drinking age.

Fact: People form their consumption habits for life in their mid- to late-twenties.

Fact: Every year in the United States, 3.5 million people in their mid- to late-twenties form their consumption habits -- and brand loyalties -- for life.

Fact: Every year in the United States, the vast majority of these young adults form their consumption habits without wine because the majority of wine marketing budgets are allocated to wine trade magazines targeting older, more established core consumers.

Fact: It costs five to 10 times as much money to change the consumption habits of a 45-year-old as it does to help form the consumption habits -- and brand loyalties -- of a 25 year old.

Fact: In 1982, the wine industry refocused its marketing and advertising campaigns from new consumers to niche trade magazines targeting core wine consumers.

Fact: Since 1982, per capita wine consumption in the United States has gone down 20 percent!

We're called busters. Thirteeners. A bunch of whiners. Slackers. The shadow generation. We're all sleeping in our clothes, moaning about the national debt we've inherited and pining for Greg and Marcia Brady. Advertising Age referred to us as "that cynical, purple-hair blob watching TV." The New Republic kvetched, "These kids today. They're soft. They don't know how good they have it. Not only did they never have to fight in a war. . . they never even had to dodge one." We're media savvy but feel alienated from mainstream culture that has ignored us. We resent Boomers for everything from hogging the best jobs to spoiling the environment. We ridicule Boomer symbols of success, such as BMWs. We're not sharing the American dream. We feel left out. And, according to Peter Francese, publisher of American Demographics, if you've got a magazine that features photographs of yuppies, we're not going to read it.

Generation X. Xers. Named so after Douglas Coupland's 1991 pop-arty novel, that also gave us "McJobs." There are 80 million of us with 125 billion dollars a year to spend. We're 70 percent white, 13 percent black, 12 percent Hispanic, 4 percent Asian and 1 percent Native American. According to advertising mogul J. Walter Thompson, "Generation X will fuel the growth for product categories from fast food to liquor to apparel to soft drinks." But, unlike the Boomers before us, we have a bullshit meter more sensitive than any seismograph. During the years we were watching Saturday-morning cartoons, we were assaulted by a barrage of advertising so intense it had to addressed by federal legislation. Karen Ritchie, author of "After the Boom," comments, "The first time you realize the super toy you wanted is really only four inches tall you learn a hard lesson. We created a whole generation that believes advertising is lies and hype."

According to a recent survey only 4 to 6 percent of Generation X adults (21 to 35 year olds) drink wine, compared to a national average of 46 percent. The reason I chose "MARKETING WINE TO GENERATION X" as the title for this morning's seminar is because it's an oxymoron. We are not, as an industry, marketing wine to Generation X. The majority of wineries, wholesalers, retailers and core wine consumers in this country are not only neglecting my generation when it comes to wine but rejecting us. There has been little or no attempt by the wine industry to reach out to younger alcohol consumers -- consumers who are now establishing their drinking habits for life -- with the message that wine can be and, more emphatically, should be a part of their lifestyle. Instead, the wine industry has gone to great lengths to alienate both itself and its product from us. Industry advertising is vastly restricted to elitist wine publications, who preach to the choir, who boast reader demographics of older, wealthier individuals, and who's contents exploit the lifestyles of the rich and famous and very privileged people enjoying what they consider a very privileged beverage. Wine festivals center around the wine industry instead of the general public, catering to those wealthy enough to afford the high-priced tickets and lavish lifestyles. And wine dinners are generally conducted in exclusive restaurants, featuring wines out of most young people's price range. As one Xer put it so poignantly, "you cannot continually insult a group of people and expect them to turn around one day, and support you."

So what do we do as an industry -- as educators, winery owners, wholesalers and retailers -- what do we do to fix this problem? How do we reach more that 4 to 6 percent of a new generation of consumers who, for all we know, has already given up on wine and moved on to other alcohol beverages? How do we sell products to a pragmatic Generation who, as soon as they think you're trying to sell them something, turn off and walk away?

Before I give the $64,000 answer, I should introduce myself. I'm Darryl Roberts. I edit and publish a new wine magazine called Wine X. We also have an Internet site called Wine X Wired, which, for those who surf the 'Net., is located at winexwired.com.

In addition to editing and publishing Wine X, I am wine columnist for the Robb Report, wine editor for Australia On-Line, educational consultant to Matanzas Creek Winery, I teach wine seminars in Santa Rosa, California, and other venues. I was director of public relations for Matanzas Creek Winery, on the winemaking team at Franciscan Estates for 2 years, and before that I was co-host of "The Wine Cellar" radio program in Los Angeles on KGIL with restaurant critic Larry Lipson.

Wine X Magazine, as our cover states, is a new voice for a new generation of wine consumers. We're specifically targeting younger alcohol consumers, Generation X, with straightforward information and education regarding wine and how it can fit into their lifestyle. Our credo is, "Wine isn't a lifestyle, it's a complement to one." If you didn't pick one up on the way in please do so on your way out.

Before I get in to all of this, I want to clarify a few things up front. I'm certainly not a spokesperson for my entire Generation. I certainly don't pretend to represent all of my peer's views, concerns, mortality or expectations. I simply listen to my peers when it comes to wine and the wine industry, and then react and reflect those voices and concerns in my publication.

For those of you who read Wine X, which is probably a very small percentage of you since we're a fairly new publication,... but for those familiar with our content, especially my opinion column, you know I don't hold back on anything. I'm a pretty outspoken person. Especially when it comes to sighting, what I think, are the major problems in the wine industry and its marketing practices (or lack of them ) towards younger wine consumers. I tend to piss some people off,.. actually I tend to piss a lot of people off, and I'm probably gonna do it here this morning, especially those of you who either work at or own wineries. Probably piss off some Xers, too. Wouldn't be the first time.

The reason I tend to piss people off, especially older people, is because the wine industry's solution to reaching my generation with wine is to stick its head in the sand, thinking that, if left long enough, the problem that we're not drinking it will just go away. Solve itself. But it won't. And it's not. So, every chance I get, I just gently remind them to get their heads out of their you know what and start doing something about it.

I don't, however, do it with malice intent. Rather I simply hold a mirror up to the industry and ask it to take a good, an objective look, at what our generation sees. From a different perspective. Our perspective. And, as you're about to see for yourself, what we see is not pretty.

The wine industry is in big trouble. Drastic changes need to be implemented in marketing practices if we're going to survive the next ten years. You can believe all the industry hype and propaganda and PR campaigns about how well it's doing, about how thing's in the industry have never been better. But that's all it is. Hype and propaganda. Because the truth is, we sold less wine last year in the United States than we did in 1982, and per capita consumption in this country over the last fifteen years has dropped from 2.58 gallons per adult to 2.13 gallons. Any percentage increase in sales that the wine industry currently boasts about is merely reclaiming the percentage of the market it has lost since the early 1980s.

Now you would think that hearing this data the industry would try to do something about it. Try to reach out to new consumers. But they don't. Marketing and business practices remain status quo. The industry continues to market to the same people, in the same publications, in the same staid presentation that it has for the last twenty years. It still doesn't understand that these marketing techniques aren't working anymore. That unless new strategies are implemented -- that unless we bring new, younger wine consumers into the market today -- there will be wine industry tomorrow. It's really very simple. New consumers to replace the old. Yet the wine industry still doesn't seem to get it.

I think the reason is, and the problem is, there's this great myth that circulates through the veins of the wine industry, like a morphine of sorts, a temporarily panacea for all it's marketing ills. This myth, which interestingly enough, started about the same time the industry started noticing the decline of younger wine consumers, is that, and we've all heard this, the myth is "that young people will grow into wine as they get older. They will, like all the generations before them, accept wine into their lifestyle as they make more money and travel more."

Now I can certainly understand why the wine industry would embrace and basically exploit this myth. It's the perfect short term remedy for their problem. Why are they only reaching 4 to 6 percent of young adults? Well, it's 'cause they're young. They'll grow into it. Just like all the other generations did. Well, the myth that young people will naturally grow into wine, like generations before them, that, given time, money, maturity, they will grow into incorporating wine into their lifestyle, is bullshit. This myth is just exactly that, a myth. There has not been one generation in this country that has, quote, grown into wine or incorporated wine into their lifestyle simply because they grew older. Before the wine boom in the late 70's and early 80s, per capita wine consumption in this country was about 1 gallon per adult. Most of the wine consumed before this period, before the wine boom, was consumed by transplanted Europeans who, having grown up with wine all their lives, continued to incorporate wine into their lifestyles here. Their children grew into wine, not because of their age, not because of their maturity, not because they made more money or traveled more. They grew into wine because they were brought up with wine. In their family. As a lifestyle choice.

The wine boom of the 70's and 80's wasn't the result of Baby Boomers growing into wine, it was the result a generation deciding to elevate wine from a simple table beverage to a status symbol. Wine became chic. Wine was fad. Ordering a glass of Chablis was "cool". Boomers weren't making any more money than we're making now. They weren't any more mature than we are. Wine was simply cool. Wine during this boom period became the BMW in the garage. In this country, and probably every country in the world, the fact is, is that every generation rebels against the generation before them. It does not follow in their footsteps. And you would think that the majority of marketers today, being Boomers, would understand this. And do something about it.

But they continue to stick their heads in the sand and make excuses and create myths and wait for something that's simply not going to happen to happen. Why? Why doesn't the industry attack this new generation, my generation, with the same fervor, cultural awareness and creativity that it did with the generation before us?

Because, quite simply, it doesn't know how to. The wine industry doesn't understand us. But more importantly, it doesn't want to.

To attack a problem we first must first know who or what it is. So let's try to understand my generation and where we're coming from. Maybe then, we can "want to."

I'm not going to take too much time on this but I think to understand generational labels, such as Generation X, we should first understand what a generation is.

In their book, "Generations: The History of America's Future 1584-2069," William Strauss and Neil Howe propose that a generation be defined as a "cohort group whose length approximates the span of a phase of life and whose boundaries are fixed by peer personality." This definition has two elements:

- first, the length of time required to produce offspring -- the next generation;

and second, the aspect of "peer personality."

Strauss and Howe propose that the length of each life phase -- each generation -- is approximately 22 years, with adjustments for historical circumstances. This results in a new generation every 18 to 24 years. Generation X, called "Thirteeners" by Strauss and Howe because we are the 13th generation produced in America since its founding, are defined as being born between 1961 and 1981, meaning we're 15 to 35 year olds.

I state this is because there seems to be a lot of confusion and misinformation regarding our age and demographics. Some people, when you mention Xers think we're those teenagers wearing our pants around our knees. Hey, it's a look. There may be a few trailing edge Xers that fit this description but us leading edge Xers don't take any responsibility for them. We're quite fashion conscious, as you can see. (Show shirt) And very subtle. For those who haven't seen the back of my shirt it says "Wine doesn't suck."

If you listen to others, especially the media, Generation X is 30 years old and under. The label, Generation X, came into being five years ago with Coupland's novel. We were defined then as 30 years old and under. We do age. And we have aged over the last five years. In fact we've aged about, ah, 'bout five years. Some of us more than others. For those in the front that can see my gray hair.

But I follow Strauss and Howe's definition, that we're 15 to 35 year olds. I think that's a good model. So that's what I'll be using for this presentation.

Using the Straus and Howe age definitions above, the 1995 United States census indicated there are approximately 80 million Generation Xers, compared to 70 million Baby Boomers. That's right. There are more Xers than Boomers in this country now and have been since 1980. By the next census in the year 2,000, there will be more Xer adults than Boomer adults living in the United States. In fact, Generation X is the largest generation that this country has produced to date.

According to market research, Xers are well-traveled, as likely to buy a new car as Boomers (imported preferred), buy more CDs, drink more cola, consume more fast food, b uy more disposable diapers, gas ranges, oven cleaners, electric can openers and smoke more cigarettes than Boomers. We are 50 percent more likely to participate in aerobics, 10 percent more likely to belong to a health club and are slightly more likely to have visited a resort/spa in the past year. We are the major consumers of health and exercise equipment, sporting goods and clothing for recreation and leisure. We drink more beer and wine coolers and are the volume consumers of rum, tequila and vodka. We use more toothpaste, chew more gum, wear contact lenses more often and play more video games. In virtually every product category, except wine, Xers are an important part of the present-day market and are unquestionably the market of the future.

The above statistics were complied from Karen Ritchie's book, Marketing to Generation X -- which I highly recommend as reading if you are currently in marketing or planning to market anything in the future. In her book, Ms. Ritchie stresses that the reason Xers are ignored and neglected by marketers and advertisers is because the bulk of them are Baby Boomers. Until the X Generation came to be, Boomers represented a critically important market simply because there were so many of them. We have to remember, the Baby Boomers were the largest generation ever produced in the country's history. So why not use that same marketing logic with Generation X?

Partly, Ritchie explains, "is because Boomers desire to think of themselves as young, with the natural instinct to preserve their own hard-won base of power. In a way, Baby Boomers have held the franchise on youth in America for the past 50 years and may find middle age a more difficult assignment. Boomers are, in fact, just coming into their golden age. They now hold most of the top and midlevel corporate and government jobs. They earn the largest salaries, own the most expensive houses, wear the best clothes. They run the banks and the media. Boomers are rich and powerful, but this," states Ritchie, "doesn't make them young. The truth is that the fortunes of Baby Boomer marketers have been directly tied to the fortunes of the Baby Boomer generation for so long that these marketers have begun to lose perspective."

But Ritchie also stresses that we have to give credit where credit is due. Boomers were very successful marketers. They sold cars to women and laundry soap and prepared food to men. They put Black and Hispanic and Asian faces in commercials and showed young hippies singing on mountaintops. Marketing to Boomers became one of the most lucrative initiatives an advertiser could undertake. Boomers were so successful in marketing to other Boomers that now they don't know how to do anything else. Boomers have been so successful in selling wine to Boomers, that they don't know how to do anything else.

Now that I've raised the hair on every Boomer's back, I want to present some data to support this rather harsh opinion. I solicited certain materials for this seminar from various organizations allegedly striving to expand wine consumption across this country. One of these organizations is the Wine Market Council, which is headed by John Guillespie.

And please note this: The wine market council's statistics sight people between the ages of 21 and 59. I questioned Mr. Guillespie as to why he restricted his research to 21 to 59 year olds and he said because people over 59 were unmarketable. For wine. So please keep that in mind for the following.

The Wine Council breaks up wine consumers basically into three categories:

First group is Core wine drinkers. Core wine drinkers are adults who consume wine 2 to 3 times a month. Could be a glass, bottle, sip. Whatever. Core wine consumers make up 16 percent of the adult population between the ages of 21 and 59, with the majority falling between the ages of 40 and 59.

Second group is Marginal wine consumers. Marginal wine consumers are adults who drink wine less than 2 to 3 times a month but more frequently than every 2 to 3 months. 14 percent of the adult population between 21 and 59 are considered Marginal wine consumers, with the majority falling between the ages of 35 and 59.

And the third group we have are non-adopters. Non-adopters are adult consumers who drink wine less than every 2 to 3 months or not at all. 27 percent of adults between the ages of 21 to 59 fall into this category, with the vast majority of them being Generation X.

According to the Wine Market Council, core wine consumers, sixteen percent of adults in this country drink 88 percent of the wine. 88 percent! Marginal wine consumers (14 percent of adults) drink 10 percent of the wine. And only 2 percent of the wine consumed in this country is by non-adopters, who represent 27 percent of the adult population. Again, this is the majority of Generation X.

And if you do your math correctly, 43 percent of Americans (or about 115 million adults) abstain from drinking alcohol.

Using the council's data it's I think it's pretty obvious that if 16 percent of the adults in this country are consuming 88 percent of the wine, we don't need to market wine to these people. I think they're sold on the idea of wine, that drinking wine is a good thing.

Thus, it would make good sense to sell wine (and the user-friendly image of wine) to the marginal and non-adopter drinkers -- people who like wine but who drink it less frequently for certain reasons, like Generation X. If we could, let's say, sell these marginal and non-adopter adults on the idea that wine is not just for special occasions -- which data supports is the primary consumption habit of marginal and non-adopter adults -- we might actually sell more wine to more people, instead of selling more wine to fewer people, as the data supports we are doing now.

With this in mind, I did some simple math and came up with the following:

If we could influence marginal wine consumers to buy one more bottle of wine a month, just one more bottle a month, we could increase annual wine sales in this country by 17 percent. Seventeen percent!

And if we could get non-adopters -- which basically means Generation X -- if we can get Generation X to buy one more, or just A bottle, of wine a year, just one, annual wine sales in this country would go up to about 20 percent.

Wine sales in 1995 increased 4.5 percent over 1994. And, hearing this new the wine industry nearly wet their pants they were so happy. They were jumping around giving high fives like they had just won the world series.

And they should. 4.5 percent growth is nice. It's good. But let's look at reality here. This 4.5 percent of growth isn't growth into the younger market. In fact, less than 1 percent of adults turning 21 drink wine. This growth, the highest growth area for wine over thee last year, was in the 45 to 55 year old bracket.

Let's put this in perspective, with Generation X and the other beverages we're consuming:

Microbrews. Microbrews grew over 10% last year. Bottled water grew over 10% Sports beverages grew over 10% And ready to drink teas, like Snapple and Lipton, grew over 60 percent last year, the majority, again, consumed by Generation X.

I know comparing non-alcoholic beverages with wine is difficult, but again, these are products we're buying. That we're consuming. These are products, that, if you look at their advertising and marketing campaigns, are directly targeting Generation X. And getting them.

Before I get into what I think will work in increasing the core consumer group in this country -- which basically means increasing the wine consumption habits of Generation X -- I want to look at what the industry's doing and why it's NOT working.

It's rather amusing, actually, to watch winery and wine industry advertising at work. It's kinda like watching penguins following each other off an iceberg, you know. It reminds me a lot of my father's favorite saying when I was a kid: "If your friends jumped off a bridge would you?" I think if you asked winery marketing directors this same question today their answer would be "sure, why not." Marketing in the wine industry is predictable. Because the first thing wineries do when they get a few marketing dollars in their pocket is ring up the same old publications, the Wine Spectator and/or Wine Enthusiast, to buy ad space. It's as if wine marketers think wine drinkers in this country don't read any other magazines. Their mentality is that wine drinkers only read to two magazines. That's it. And both these magazines are wine magazines. No Readers Digest. No Home and Garden. No Wired. Just Wine Spectator and Wine Enthusiast. Their life revolves around wine. So, consequently, millions and millions and millions of wine advertising dollars are spent each year in these two wine publications, which, incidentally, if you work the math, only reach, at most .5 percent of the CORE wine consumers in this country. Point 5 percent. And factoring in subscription overlap, according to my calculator, these two magazines reach .05 percent of adults in this country. So the wine industry spends millions and millions and millions of ad dollars every year trying to sell wine to .05 percent of core consumer adults who, as I previously stated, are already buying wine.

Why? Why do they do this? Why do wineries and wine companies spend $15,000 a pop for this waste of space? Why do they keep jumping off the bridge?

I don't know. I don't have the answer. I ask wineries this question all the time and I keep getting the same stupid answers. "Well, we're showing our distributors that we support them." It's like, Pardon me? Hey, you want to support your distributors, cut 'em check. Take the fifteen grand and slice it up between 'em. Seriously, what would you rather have, money in your pocket or a stupid picture in a magazine?

Wouldn't be smarter to spend all this industry money, the millions and millions and millions of dollars reaching out a broader consumer base than just the .05 percent of an already saturated wine market?

And what about the 70 million Generation X adults who currently represent potential wine consumers? Since about 67 million of us aren't drinking any wine at all (or very little of it), how is advertising in these wine magazines influencing us to incorporate wine into our everyday lifestyle? I think it's safe to say that if we're not drinking wine, we're probably not reading Wine Spectator. Then again, I could be wrong on this one. Maybe drinking microbrews and reading the Wine Spectator has become some new Gen X cult thing. You know? I mean, I don't get out that often, who knows.

I don't think so.

What I'm trying to stress here is that if we want to increase the consumer base in this country -- if we want Generation X (and other marginal and non-adopters) to drink wine and drink more of it -- we need to become more visible in other mediums. Only advertising in wine magazines ain't gonna cut it anymore. It's time to move on. It's time to suck up our pride, check our egos at the door and lower ourselves, heaven forbid, to advertising in those "other" magazines. It's time to convince young alcohol consumers -- who, again, are now setting their consumption habits for life -- it's time to convince them to include wine in their lifestyle as a beverage choice. And to do so we must reach out to them on their level. Not ours. If we can increase the number of core wine consumers in this country -- instead of trying to increase sales to core wine consumers -- we'll make the wine boom of the seventies and eighties look like a whimper.

I just want add, here, that it was the Wine Market Council's recommendation to the industry, after their surveys and data compilations, it was their recommendation to NOT target white males between the ages of 21 and 29. To NOT target this group. Now, I've heard a lot of stupid proposals in my life -- before I started Wine X I was a producer Los Angeles -- but this one takes the prize. Here we have 25 to 30 million young men, potential consumers of our product, men who are now forming their consumption habits for life, and the Wine Market Council recommends that the wine industry ignore them. Someone please explain this one to me 'cause I can't for the life of me figure this one out.

By the way, the wine market council is funded by the wine industry. Of course.

At this point I wanted to show a video to basically back up my statements but because of the size off the room it's not possible So I'm just going to highlight some the comments and statistics that were presented.

The video, called "Hard to Swallow", was produced last year for the Wine Institute's "Public Relations Tools for the 21st Century" communications clinic. Producers Tina Caputo and Jennifer Strailey took their home video camera into Gen X environments and asked these young adults a series of questions regarding alcohol, wine and wine's image. Here is what they found:

Young adults spend anywhere between $30 and $300 a week on alcoholic beverages, or "entertainment" as some referred to it. Very little, if any of that, is spent on wine.

If they do drink wine, it's either at home and/or in upscale restaurants with dinner. Or, as in my case, if someone else is buying.

When asked why they don't drink wine in bars, answers ranged from "that wineglass stemware is too delicate and breaks too easy in a crowded environment" to "bars don't offer good wines by the glass. If they do, they're always too expensive."

When asked who they thought the average wine consumer was the consensus was, someone who is older, rich, and a bit stuffy and pretentious.

One of the more humorous moments of the video, unfortunately NOT so humorous for the wine industry, was when these young adults were asked to name their favorite alcohol ads and jingles. Everyone interviewed rattled off a series of print, radio and television ads and jingles ranging from Tangeray's character "Mr. Jenkins" in print ads to the now famous "bud" "wies" "er" frogs on television. Then these same young adults were asked to name a wine ad or jingle that they remembered. The silence and contorted looks on their faces as they struggled for just one familiar ad was embarrassing. Not one young adult in this video, not one Generation X adult, could name a wine ad, in print, radio or television, more recent than "We will sell no wine before its time."

There were other areas of concern by my peers which I don't have time to go into,... but the general consensus, in this video, to put it delicately, is that wine's image sucks. And if we want to get down to the root of the problem, with my generation, this is it. The image of wine, sucks.

So what do we do?

ANSWERS

The first thing we need to do strip wine naked. We need to remove all the diamonds, the Rolex watches, the designer dresses and tuxedos. We need to strip wine down to it's bare essentials: That wine is a table beverage. Nothing more. It's not some specialized product meant for older, richer, more sophisticated people, but a product for all adults. To be drunk any time. Anywhere. Only then can we begin to rebuild wine's image to a new generation of consumers.

As I begin each wine class in Santa Rosa, the first thing that I stress is that it doesn't take anymore money or anymore sophistication to enjoy a glass of wine than it does a glass of milk. You either like it or you don't. And until the industry embraces this concept, until the industry gets off its high horse and stops believing it own propaganda, wine will continue to only reach a very small percentage of the American population -- a percentage, as each year passes, continues to decrease.

DIFFERENT MARKETING STRATEGIES FOR REACHING GENERATION X

This is probably not a good time to bring this up but the truth is is that I never took a marketing class. Not in college. No extension classes. Never.

But I think marketing to Generation X, or any generation, isn't about s tructured college classes with template answers. In fact I think that's why we're in the current trouble we are in this industry. Template answers don't work with changing times and changing attitudes. Marketing, to me, anyway, is simply common sense. Common sense dictates you market your product to the greatest percentage of prospective buyers. Pretty simple. If you make toys, you market to children. Not just a few children. All children. If you make alcohol products, you market to adults. Not to .05 percent of them. To all of them.

So a good start, I think, would be to concentrate on reaching the other 41 percent of the adult population, the other 83.5 million people, -- most of whom are Gen Xers -- that either don't drink wine or don't drink a whole lot of it. People, like myself, who don't care about what the rich and famous are doing or verticals of DRC's or auction prices or any of that crap. We need to concentrate on those who just want to understand wine a little bit more so they feel more comfortable buying it and drinking it.

And to do that, starting with the print medium, the industry cannot continue to restrict its advertising to wine magazines. Name one other beverage industry that only advertises in it's own publications? It's stupid. If the wine industry is to survive it must -- and that's a "must" not a "might think about" -- it must place ads in publications read by younger adults. And it must do this with new innovative advertising campaigns, that contain, perhaps, heaven forbid again, pictures of young people having fun with wine. Scary, I know. These ads should be, perhaps, maybe a little quirky, weird even, or, to barrow a Boomer term, even "far-out". But the material, as quirky or as weird or as far out as it may be, must be honest. There can be no tricks. No lies. No bull. Because our bullshit meter, as I stated, will see right through that. And it cannot be, by any means, cannot be an ad simply of a bottle of wine with wine critics' ratings and comments. Not only does my generation not know who the Wine Spectator or the Wine Enthusiast or Robert Parker are, we don't care. It's boring. Get over it. Move on.

So what are the magazines the wine industry should be advertising in?

Well, if you go down to your local newsstand and find the "Gen X" section -- you can't miss it, it's the one with all the purple-haired kids with their pants down around their knees standing in front of it -- you'll find publications like Wired, Juice, Spin, Rolling Stone, Buzz, Soma, Raygun. All these publications are written for young adults by young adults. And, if you're so bold as to pick one up and thumb through it, you'll find all the other alcoholic beverage industries are advertising in there. In full force. With ads that appeal to young consumers. Not their parents.

And when you thumb through the magazines, take a good at these ads. What you'll see are young people having fun with the product. Then, what I like to do just for fun, is find a Wine Spectator and thumb through it. Look at the wine ads. I think you'll get as good a laugh as I do.

In fact, I'll save you the trouble. 'cause I brought along some ads to show you

SLIDES:

I'm not suggesting -- although it would probably be in the industry's best interest -- but I'm not suggesting wineries or the wine industry stop advertising in wine magazines. I am suggesting, however, that they balance their advertising budgets and campaigns between all forms of print media, including, no, with an emphasis on, publications that the future of the wine industry, Generation X, reads.

RADIO AND TELEVISION

A more expensive medium, obviously, but a medium non the less that needs to be attacked aggressively with a new message and a new image of wine.

Individually, I don't think wineries can attack this medium and make any significant impact. Unless you're Gallo, of course. However, collectively, as an industry, we have the opportunity to present wine in a new, more user-friendly image to get young people at least interested in it and therefore maybe persuading them to try it. I have been preaching for years that if the wine industry, collectively, could come up with a "got milk" ad campaign, Gen Xers in this country would be pouring chardonnay over their bran flakes instead of milk. We produce a beverage that's healthier, more food-friendly and more versatile than any other beverage on the market. And we should promote that. We need to put industry differences aside, join together in this medium, and take advantage of our wine's awesome attributes.

One area we should concentrate on is placing wine in movies and young adult-oriented television shows, for example, like Friends. But wine must be presented as an everyday beverage. We can't continue to let producers and studios incorporate wine only as a celebration beverage or a beverage that's only consumed in fancy-schmancy restaurant settings. We need to put wine on the table, in a casual setting, with young people, with no "special occasion" stigma attached to it. If we can't, then we shouldn't. Because the more we present wine, and the more the public sees wine, only as a "special occasion" beverage, the more they're only gonna buy wine for a special occasions.

THE INTERNET:

I know Paul Wagner is presenting a seminar later today on this subject, so it'll be interesting to see what his views of this are.

The Internet, in my opinion, is one of the best marketing tools that the wine industry can use to reach Generation X.

To understand why I think this, and why other industries share the same opinion, let's look at the 'net's demographics:

-- in 1994, there were 38 million people on the Internet. In 1995, that number increased to 56 million. That's a 67% increase. By the turn of the century it is estimated that there will be over 250 million "net users world-wide.

Currently: (Georgia Tech survey)

-- 70 percent of Internet users are under the age of 30. -- 77% are male, 23% are female -- 89% have attended college -- 50% are married -- annual household income of $50-$60,000 -- there are around 45,000 businesses on-line, with 150 new companies going on-line everyday.

Three years ago there was really no commercial internet. Today we have a new communications medium which is attracting millions of people a month to it. The Internet is no longer a novelty. It is a medium that is quickly becoming a fixture in business and personal use in the same way the telephone is a fixture in our everyday life. The question today isn't whether you will go on-line, it's when. And for those businesses who are savvy enough to recognize the Internet's reach and potential, that "when" is now.

So let's look at what we have here:

We have a medium that's predominantly populated by educated, fairly affluent, young adults, that reaches world-wide and is growing at an average of over 60% a year. You have these young adults full attention. With the opportunity to present your product (and image) in as much time and space you want.

We have a medium where, for about $1,200 to $2,000 a year, a winery or wine company can establish their own web page and potentially reach over 58 million people world-wide, mostly young, with unlimited product and information, graphics and potential sales, 24 hours a day, 365 days a year.

Nowhere else can you get this kind of exposure for so little money. For the cost of one little Spectator ad that reaches 150,000 people for two weeks, you can reach 58 million people world-wide all year round. It is this reason that I feel the Internet is the one of the wine industry's best answers to reaching Generation X.

But, unfortunately, for the most part, the wine industry hasn't embraced this idea. For some reason wineries still rather take their $1,500 and buy a small little ad in a wine magazine to reach the same saturated market. It's not that they haven't been informed about the 'Net. There are a number of companies out there now who specialize in putting wineries on-line and I know, from my personal relationship with one of these companies, The Grapevine, that it's very unlikely today that any winery hasn't heard or been told about going on the Internet. The industry knows about this medium, but for the most part, refuses to utilize its potential. Again, it's the heard mentality.

I was planning to actually take you on-line and show you a bit of the 'net, but unfortunately I can't, so you'll have to use you're imagination here for a bit. If anyone is interested, though, I can show you a demo of some sites on my laptop after the seminar. So see me after.

To demonstrate the 'Net's potential, let's take for example my publication Wine X.

Wine X, in some form or another, has been around for about a year, but under different names. Only the last three issues have actually had the name Wine X on the cover. The first six months were test market publications. We basically tested different formats, styles, names and sent samples both to consumers and press soliciting feedback. And boy did we get it. At the same time we started test marketing our print format, I launched Wine X (then called Wines International) on the Internet. We were the first wine publication to be accessible in both print format and on the Internet. In our first year, our subscriber base, in print, went from 1,000 to 5,600 subscribers. A nice percentage increase. Our Internet hits, though, people who read the publication on-line, went from zero to over 120,000.

Now, you don't have to be a mathematician to figure out where the potential for reaching younger consumers is, not only for publication's like mine, but for the wine industry as a whole. There is a hungry, thirsty population out there on the 'Net craving information and new products. And since wine is basically new to them, you have greater potential here than anywhere else.

Society is coming full circle. 150 years ago, news and information traveled by newspapers, press -- the written word. Then radio came about and stole some of the thunder. Then television stole even more. Now, we have a whole new generation of people, some now in their late twenties early thirties, who have grown up with computers all their lives. And information, a vast majority of it, is obtained on the computer, in black and white, in the written word. The X Generation probably reads more, whether on computer or in print, then their parents or grandparents did. That's why more and more newspapers, magazines and books are becoming available on-line. Publishers realize the potential for the Internet to reach younger consumers. So should the wine industry.

LET'S TALK ABOUT WINE BRATS

The Wine Brats is a non profit organization made up of young adults, like myself, who are dedicated to demystifying wine for younger adult consumers, so they will make wine an integral part of their lifestyle. Through promotional and educational programs, the wine brats work to share their knowledge and love of wine with their peers, and are committed to breaking down many of the cultural barriers that have developed around wine and its mystique.

I am not going to go into depth of what the Brats do. There's a Brat newsletter on the back table,... but I strongly urge you, if you don't already, to support this organization. It is the only group, other than Wine X Magazine, that is specifically reaching out to younger consumers in a peer to peer environment. They are forming chapters all over the United States and Canada, in an effort to present wine in an unelitist, unpretentious manner, to attract that crucial demographic this industry desperately needs. If we don't support the Wine Brats or other organizations like them, then the chances of reaching Generation X will be drastically reduced. They are, and if I may be so bold to say, we are the future of this industry. Without industry support and support from people like you here today, there will be no one reaching out to the future consumers of this industry.

What I like to leave people with, especially marketing people who seem to have a hard time breaking out of old habits, is this:

NINE DOTS PUZZLE

We tend to approach problems in life with preconceived limitations. Solutions to our problems are usually visible, just never seen because we refuse to see them. If we continue to stay within the confines of the environment we've created, these problems will persist. But if we step out of this environment, if we move outside the nine dots, we see the solution is really very simple.

And if you remember anything from this seminar here this morning, remember the nine dots. Because we're a different generation, a new generation, whose values, perceptions and levels of tolerance are vastly different from any generation before us, especially the Baby Boomers. So treat us that way. Don't assume marketing that worked for that generation will now work for ours. Don't get stuck within the confines of their environment. Because it won't. And it's not.

If you want us to drink wine, if you want Generation X to incorporate wine into its lifestyle, you must first understand our lifestyle. You must understand us. You must understand that we present new problems, which require new solutions. And those solutions lie outside the nine dots.

Whether we like us or hate us. Agree with us or are at odds with everything we stand for. The industry needs us as consumers to survive. Because like it or not, we are the ones that will replace you. We are the future consumers of this country.

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