At WineNews.it the communication expert’s analysis: positive trend, promotion is fundamental, but the future will be digital
In the United States, which is the largest market in the world for wine and the most important foreign market for Italy, the alert on Covid-19 is still very high. Can you give us an idea of how much the wine market has been affected by that?
“Overall, wine sales in the US are doing well in spite of the challenges of Covid-19. Sales have shifted to off-premise and ecommerce but have not measurably decreased.
Covid-19 has negatively impacted boutique / fine wines that require a ‘hand sell.’ With no events (trade or consumer) to generate trial and dramatically reduced on-premise business, the traditional methods of selling boutique wines and new wines are no longer possible. Pre-Covid, Sommeliers had become the most important gatekeepers for boutique, fine wines but their influence has been greatly reduced under Covid-19. Brands with high awareness, on the other hand, are selling very well because consumers are ‘buying’, not ‘shopping.’ A leading retailer told me that his customers come into the store already knowing what they want. They go to the shelf, pick up the bottle(s) then check out. They don’t ask for help with their selections and they don’t browse.
Boutique Italian wine producers from well-known denominations like Chianti Classico or Brunello need to promote the denomination as the brand in order to give consumers confidence in their choices. Producers from lesser known denominations can promote their regions (i.e. Tuscany as a brand for Montecucco producers) or Sicily as a brand. Italian wines are still performing well as a category. More promotion also needs to be done by ‘brand Italy’ (i.e. the Italian Trade Commission or Vinitaly) to help all Italian producers sell during these challenging times.
Fine / boutique wines also need to adapt by utilizing digital tools and platforms to gain awareness and initiate trial. One positive effect of Covid-19 is the relaxation of laws restricting Direct to Consumer (DTC) communications and sales. Italian producers, large and small, have the opportunity to communicate directly with consumers and build brand awareness as well as initiate a sale by partnering with an online retailer, for example. Also, by take advantage of relaxed laws and new digital tools during the crisis, boutique producers will be in a great position to build their brands and sell more wines once the on-premise channel begins to open up.”
Events and many other forms of physical promotions are also suffering. During these months everything went digital. What can we expect from now on? What can we expect for physical events that are crucial in a field such as wine and where human contact is a fundamental part of the business?
“It’s impossible to know when events will resume in the US, and whether there will be in-person events as early as this fall. The virus dictates. Event planners (including my own agency) are planning on modified events with smaller numbers of attendees safely spaced with precautionary measures taken. Every state in the US will have a different experience based on the number of cases and the trends for that particular state. We’re even creating a safe tasting space within my office for small events with limited numbers of people tasting on a rotation basis. Restaurant and wine bar owners are making similar plans for modified, safe tasting spaces. Major events like the Wine Spectator Wine Experience are proceeding with planning but none of us can say with certainty what will actually happen by the fall. Even if we plan events safely, will trade feel comfortable enough to attend? There’s a big psychological impact as well that is impossible to gauge at this point. In any case, I believe events moving forward will become a hybrid of digital activations and physical tastings.”
What communication strategy do you suggest to use to Italian wineries during the upcoming months, for them to stay at the top of the US market?
“I think Italian producers need to work with their importers, distributors and best retail customers to create opportunities to engage directly with consumers. If wineries have email lists from visitors to the winery, use them to engage with consumers. Updating profiles (scores, reviews, photos, videos) on Wine.com, Vivino, SevenFifty, and other ecommerce and marketplace platforms is fundamental. Producers should also research and explore new digital tools for targeting consumers most likely to be interested in their wines. There are exciting new tools available that allow for very targeted communications and tools that make the step from brand awareness to trial / sales very easy.”
Do you think there will be permanent changes in the communication of wine as brought by the Pandemic, or will everything get back as before?
“I don’t think the previous way of selling wine will ever go back completely to pre-Covid times. And that is to the benefit of Italian producers. Progessive wineries and marketers are discovering new and efficieint ways to communicate. Think about this: the cost for a 7-day trip to the US for a winery representative or owner is about $10,000 with airfare, hotels, travel and entertainment. Three trips/year is $30,000. What if part of that money was allocated to digital communications such as building a enewsletter database and communicating directly to consumers? Or offering private virtual tastings with top buyers through retail and importer partners? Or raising a winery’s profile on a prominent ecommerce site? The convergence between commerce (sales) and communications was happenign before Covid-19. That trend has accelerated dramatically. I don’t believe savvy, progressive winery owners and marketing executives will want to go back entirely to the way things were done pre-Covid. There will be a hybrid strategy of physical events combined with online promotion, brand building and sales. For these reasons, I’m very optimistic for the future of Italian wine sales in the US.”