- 9 Jul 2019 7:44 AM
- Budapest Business Journal
As the baby boomers are ageing out of wine buying and drinking, the new target of the wine industry are the next generations: X and Y. With a defined taste in food and wine, and a larger income, the former is a consumer group easier to understand. But the young are much harder to grasp.
Unlike previous generations, Millennials won’t do posh and spend a small fortune just to be able to say they have tasted some fancy terroir wine. They also won’t feel guilty about trying to find the best deal in terms of price-to-value ratio or drinking canned or bag-in-box wine. And they have a much shorter attention span, so wine marketing professionals really have to put their thinking cap on to maintain it.
“Differences in taste can easily be traced by our two Aranymetszés wines,” Máté Varga of Varga Pincészet tells the Budapest Business Journal.
“The older generation prefers the classic, ripe, nagytestű (heavy) Olaszrizling, Gen-Y opts for the Friss (fresh, lighter) variety,” he explains.
With roughly 6,000 wineries in Hungary, competition for consumers is fierce, so vintners need to listen to their customers more.
“We can either respond by rolling out new products or reforming existing ones,” Varga says. This latter is ongoing, although they have been very cautious with the changes, Varga admits.
“Changing packaging is a sensitive issue though. We have seen some bad examples when brands lost their consumers as a result of wrongly redesigned label,” he says.
Technology also helps satisfy the needs of their young consumers. In line with changes in gastronomy, there is a shift towards fresher and more fruity wines.
Open to new Wines
The young have an impact on their parents’ choices as well. They show their parents what they like, and in an attempt to try and remain more youthful, those parents are becoming more open to new wines, Varga says.
While Gen Y sticks with their favorite wines, Gen Z is not loyal at all, and buys on impulse, Varga notes. They are more proficient tasters and “punish” bad wines, he adds.
“They won’t spend a lot of time trying to find the best rosé; if two out of three they have tasted turn out to be not good, they’ll move on and drink beer.”
Indeed, the craft beer industry is a serious contender for winemakers, as it is proving to be better at providing drinks with no fluctuation in quality. Constantly improving the quality of wines is, therefore, a must, Varga notes.
When making a choice, the young are not influenced by the story of a wine or the region. They will make their own decision, simply based on whether they like a wine or not.
“When I worked at Sziget Festival, some people wanted to hear the story of the wine even before trying it. I told them to taste it first and decide for themselves. We don’t want to sell a story or an “experience”, we want our customers to decide what they like,” Varga says.
Communication is key. It is important to keep reminding these younger buyers you exist as, even if they like a brand, they easily forget about it, being bombarded by thousands of other offers, Varga says.
Borháló, a wine store network selling wine in different containers to create a favorable price point, holds wine tasting events on a regular basis. Not only is this part of its marketing strategy to get people closer to their wines, it also serves business purposes to get instant feedback on what people like.
The people attending these tastings are quite an assortment, from customers in their early 20s to people in their 50s. The latter have a certain taste in wines, but the young have no preferences, Krisztián Kathona, founder of Borháló tells the BBJ.
“They are more open and are certainly not deterred by different containers such as a bag-n-box,” he says.
What the young are more concerned about is getting a good deal. Many won’t go to expensive wine bars, they would rather buy the quantity they want and drink it at a concert or in a park. According to Kathona, this sort of “ignorance” is actually quite useful as it allows the young to taste and pick wines freely with none of the preconceptions characteristic of the older generation.
“Our aim is to get to a point where consumers feel they can ask questions and drink a wine they like with no guilt. This takes time as wine snobbery is a thing and you would find many claiming they will not drink wine from the Mór Wine Region or only drink Cabernet Sauvigon,” Kathona says.
In terms of varieties, Irsai is by far the most popular among Borháló customers. “We are moving away from sweet and semi-sweet wines towards the more fresh and fruity ones. And it makes absolute sense as most drink it as fröccs [the Hungarian wine and soda drink],” he adds. Of equal popularity is rosé.
As a retailer, Borháló is in constant touch with wineries. Kathona visits cellars every week and takes new samples he thinks would be popular with their customers.
“Retailers are a crucial link between wineries and consumers”, Kathona says. It is important that wineries remain open and, if necessary, adjust their wines based on the feedback they receive.”