There is a changing profile of wine drinkers in Australia. Australians are drinking wine less frequently and are opting for other beverages including more non-alcoholic options, gin, cocktails and craft beer. As the population gets older there’s also implications to consider as the face of our wine consumer and their drinking habits continue to evolve. In 2010, 50% of the adult population (8.5 million people) were weekly wine drinkers but this has fallen in 2018 to 41% or 7.4 million people, a drop of 13%.
Our Direct to Consumer Specialist Emily McCutcheon recently attended Wine Intelligence’s “The evolution of wine drinkers in Australia and beyond” workshop in Sydney and found there are some key macro trends to consider:
Wine knowledge is down but wine confidence is up.
Indices used by Wine Intelligence to measure consumer wine knowledge and consumer wine confidence have found that there is a lower wine knowledge in 2019 than the same survey in 2015 but surprisingly an increase in wine confidence.
Decreasing wine involvement
Australian regular wine drinkers are becoming less experimental, tending to stick to what they know and like. This decreasing wine involvement has negative effects for pricing as the consumer becomes more price sensitive, knowing they can get good value and good wine for $10 a bottle. This trend can also be seen in the USA.
What does the Australian wine drinker want?
There are shifting choice cues in the Australian regular wine drinking market over the last 10 years. Grape variety remains firmly at number one; we still choose based on brands we are aware of (2nd) and promotional offers (3rd). Rounding out the top 5 choice cues are wine that matches or compliments food (4th) and recommendation by friend or family (5th). The shift has been an increasing interest in the alcohol content and the appeal of the bottle and/or label design.
Packaging is very much growing in importance in all mature wine markets. It is more important and has increased more over time for younger drinkers who are looking at the impression that the wine they choose gives to others.
Likewise, alcohol content has increased in importance to consumers in Australia but also similarly in Canada, UK, US and Japan. The consumer is not necessarily saying they are looking for lower alcohol wines, in some cases, for red wines, higher alcohol can act as a proxy for higher quality, fuller red wine.
Brands need to be cognisant of the consumer choice cues (1. Grape variety and 2. Brand I am aware of) but there’s also other considerations that now are added into the mix. To drive this brand awareness and therefore be ‘at risk of being bought’, wine companies will need to invest in relationship marketing, growing their online following, talking to consumers at cellar door and events and developing active wine club members. External recommendations have increased for younger consumers (who are actively seeking approval) but decreased slightly for older consumers.
Which country’s wines are the most popular for Australian wine drinkers?
We all love to drink Australian wines, without a doubt. In 2018, 85% of regular wine drinkers consumed Australian wine (but this has dropped since 2007). Our next most popular drop is New Zealand wine which 41% of surveyed consumers have drunk in the past 6 months (an increase since 2007). Not much has changed in terms of our drinking of French and Italian wines in the past 10 years, but we are drinking more Californian wine (9%), Spanish (10%) and Argentinian (5%).
As the consumers become more health conscious, we’re seeing them actively reduce alcohol consumption by drinking less midweek (reducing drinking occasions) and drinking less.
How do we speak to the most relevant consumer for our wines?
Overall, the adult Australian wine drinker can be divided into six groups with similar characteristics defining the group or segment. In 2019, these 6 groups have been given new names which help us to recognise and target them for our communications.
1. Engaged Explorers – Most frequent drinkers, highest spenders, very wide range of brands. Skewed male (59%) and younger (54% under 35)
2. Social Newbies – Drinking wine in social occasions, low wine knowledge but high in confidence. Skewed toward male (59%).
3. Mainstream Matures – Want and know good value. Highest level wine knowledge, involvement and wine confidence. 50/50 Male/Female
These three segments make up only 44% of the population of regular wine drinkers but they account for over 70% of the total spend on wine. They are our most attractive segments and we need to think about what they are looking for in a wine experience.
4. Contended Treaters – Not as frequent as other groups. Drinking for social and enjoyment. Wide range of ages and slightly skewed toward females (55%).
5. Senior Bargain Hunters – Wine serves a function, but they don’t think much about it. “Stick to what I know.” Skewed older (52% over 55 years) and female (59%)
6. Kitchen Casuals – Might drink wine on a special occasion and have limited wine knowledge. Slightly more male (55%) and slightly older (majority are over 45 years)
Of the remaining groups, the most significant by number and spend are the Senior Bargain Hunters. They make up 27 percent of the wine drinking population and they are loyal drinkers. You probably know these as some of your most regular customers. They have spent years drinking a range of products, so they know about wine, but they don’t see themselves as ‘involved’ in wine – they just like to drink it.
And whilst those highly involved in the category have a larger repertoire, it’s worth remembering that the average consumer will only buy 2.7 brands. From 2015 to 2019 Australians have become slightly more limited in the average number of brands purchased. Over 55s are aware of the most brands (23.1) but have a similar number of brands they will purchase.
|Demographic||Number of brands aware of||Number of brands purchased (past 3 months)|
We also need to consider younger wine consumers who are highly engaged but not as knowledgeable about regions and brands. Have a read of what Wine Intelligence had to say about this group here.
Consumer insights remain important to drive strategy and product focus
In Australia, we are seeing trends that are very similar to the other mature wine markets, UK, USA and Canada. Wine brands need to work hard for growth in this competitive environment.
Food and wine matching and wine experiences at Cellar Doors will be key to targeting the Engaged Explorer and Social Newbies who are highly involved and looking for wine knowledge. Another opportunity here is with innovation in packaging and design.
What do we need to do differently?
Mastermind Consulting has a really positive outlook for the continued growth in the relationships that wine brands can create with consumers.
The takeaways to consider from these insights include asking the following questions:
- Do you know which “Portrait” your consumers fit within? If so, can you develop detailed personas to direct your marketing communications to them?
- Would your brand be known by consumers in the three most profitable “Portraits”? Can you better leverage the social media channels that they are using – YouTube, Pinterest, Facebook, Instagram?
- What are you doing to look after your loyal customers? Is there an opportunity to surprise & delight them?
- Do all your Cellar Door staff have the right skills and training to act as brand ambassadors at the key point of contact?