Is Your Wine a Luxury Brand? Marketing Wine to the Affluent (2020 Update)
If you want to grow a luxury wine brand, marketing to more affluent customers can be a winning strategy. Affluent customers– or, if you prefer, “high net worth” customers– have the disposable income to spend on luxury items (like wine) and enjoy exploring new brands.
The key to marketing to this demographic is changing your perceptions of what the affluent are like. What do you picture when you hear the word “affluent”? An older couple, sitting in the back of a limousine, drinking champagne and talking about their place in the Hamptons?
No doubt those people exist, but the face of affluence has changed dramatically in recent years. They can be of any generation–large numbers of the affluent are millennial or Generation Z. They are into social causes more than conspicuous consumption. And they are very tech savvy.
All this means that the playbook that worked 10 or 20 years ago needs to be tossed and replaced with something different. Here, we provide that new playbook.
Skip to Section:
- Discovering What Motivates Luxury Purchases
- How Do the Affluent Buy These Days?
- Brand and Reputation
- Getting Industry Influencers and Referrers Excited
- Going Digital (Yes, Even for Luxury Brands)
- More Guidance
What motivates a wealthier person to purchase a specific brand may well be different from what motivates the population at large. But what that is, is changing with the times, too.
The received wisdom is that expensive purchases by the wealthy were a kind of social signaling. It indicated one’s level of success in life, as well as one’s personal taste. Paying large sums for a premium luxury brand was not only about the quality and taste, but about the sense of privilege. Wine was an example of this par excellence.
All that is changing now. For one thing, scarcity is not what it used to be. Luxury goods are now available to a wider range of consumers. Developments in logistics and eCommerce have allowed affluent consumers to search far and wide for the specific things they want, and vendors can reach those far-flung audiences. When all brands are readily available with a mouse-click, people don’t perceive scarcity as a mark of quality or refinement. They simply find it a nuisance.
Social signaling now is done differently. Today, consumers in general, but especially affluent consumers, care if a brand is sustainable, for example, or if it is ethically sourced. They want to know not that other wealthy people buy and consume it, but whether there is a story behind the brand worth supporting.
Trust is changing, too. The affluent don’t necessarily look for “big name” luxury brands. They are willing to try things that are off the beaten path. To do so, they often look to trusted experts and influencers to get an idea of what is worth trying (i.e. what will yield the most worthwhile experience).
In other words, the traditional “conspicuous consumption” model is dying away and being replaced by a drive for “experience luxury,” tempered by a “socially responsible” sensibility. To market wine to more affluent consumers, wine brands have to recognize this, paying attention to the wine experience, as well as the wineries’ values, as reflected in their story.
The purchase patterns of affluent, high net-worth individuals tend to look somewhat different than the purchase patterns of the population at large. For example:
- They are less spontaneous and more purposeful. At least when it comes to luxury purchases, affluent customers tend to put more thought and research into where their dollars go. This means that brand-building will be important, as will long-term digital marketing strategies with consistent effort and targeting.
- They are more conscious of what influencers know. When we say “influencers,” we don’t just mean folks with a small army of Instagram followers. We mean experts and connoisseurs who are well-positioned to spot trends and keep tabs on worthwhile wine brands. These can be journalists, vintners, sommeliers, wine judges and reviewers, and yes, even some wine bloggers and social media stars.
- They are on the internet, and social media, much more. One survey done by professional services firm PwC found that roughly 98% of affluent consumers access the internet on a daily basis. Per person, they spend over three hours a day (on average) online. At least half that time (90 minutes) is spent on social media.
They are also like the rest of us in some important ways: They like discovering new, interesting products; they will recommend products they find pleasurable or worthwhile; and they want an easy, convenient buying experience.
Naturally, brand recognition and reputation are going to drive a lot of the action when it comes to the more affluent. The first step, then, is developing a brand (or rebranding) in a way that will appeal to this demographic.
Doing so will mean revising your messaging and your visuals to speak to the motivations above. For example, does your winery use sustainable practices or ethical sourcing? Mention this fact. Do you have a story about your winery? Share it. Do you create a certain kind of experience in your tasting room? Remind them of it. Remember, there is an entire consumer experience surrounding the wine itself. Make that experience as memorable and positive as possible.
One problem wineries have to combat when it comes to brand awareness is the tendency to dilute their brand. This can happen in a number of ways:
- The price point is set much too low
- The brand is on sale too often
- Pricing gimmicks (for the product or for shipping) are used
- The brand doesn’t seem exclusive at all
- The name and label make the wine look like all other luxury brands (i.e., it doesn’t seem unique)
While all of these might seem like tactics to get a consumer to buy when he or she is on the fence, they in fact send out a signal that your brand might not be a worthwhile experience after all.
Instead, wineries should invest in upping their reputation by providing white glove service. A number of nationally recognized brands already do this; we wrote about them in our white paper “White Glove Service: Nine Case Studies That Reveal the Keys to Building True Customer-Oriented Organizations.” (This paper is free to download.)
We’ll just note here that a large part of the brand experience, especially when it comes to DTC, will be in the delivery experience itself. This is why you should pay attention to things like kitting and the “unboxing experience,” as well as the details of the final mile delivery.
And of course, your winery’s own unique story will be something new and novel as well—and it’s something that the competition can’t simply reproduce.
Once you have a brand you feel will appeal, it’s time to get the attention of influencers (including the media), as well as referral partners. This will be as important as your DTC sales themselves, as your more affluent customers will look to well-established industry influencers for cues as to what’s worth trying in the world of wine.
Here, then, are some tips for building your network of referrers and influencers:
- Research which journalists are writing about wine. Contact them and offer yourself as a resource. Journalists are always looking for good quotes about recent trends. Maybe you have an opinion on the popularity of cabs, or what makes for a good wine blend. Or maybe you used the latest viticulture techniques in making your most recent vintage. See who you can share this information with and get your name out there.
- Create awesome looking content and creative assets for your influencers to use. For example, if you want more people to follow you on social media, provide other social media influencers in the wine space with great content to share– especially if that content mentions your winery.
- Have your wine professionally rated. Share the results.
- Rinse and repeat. You won’t generate buzz by doing these things one time. They need to be part of an ongoing and sustained effort. Innovation takes creativity and vision, but influence takes persistence and grace.
The world of luxury goods is going digital too.
Although luxury brands are being hit hard by the 2020 pandemic (with some sources forecasting as much as a 25% to 30% decline in sales of luxury items and services), the economy also saw a massive shift to eCommerce. Even after things open up again, it is likely that high-earning individuals will still retain many of those online buying habits. Brands that have embraced both eCommerce and digital marketing are weathering the storm better, and are poised for more market share even after restrictions are lifted.
Take social media, for example. Digimind, provider of social listening and market intelligence, found that 93% of all consumer interactions with luxury brands happened on Instagram. If you’re not leveraging this social network, you’re missing an opportunity to build your luxury brands.
Targeted advertising can also help you reach consumers who meet your criteria for income, and who already like or follow other luxury brands.
Influencers tend to have a large presence on social media as well. Use these channels to contact them and share information. Invite them to try your product, visit your tasting room, and so on. If the connection is there, don’t be shy about asking for the mention.
User experience at the point of purchase is important, too. For an eCommerce store, this means things like simple navigation across platforms, multiple payment methods, customer histories, and “one-click up-sell” capabilities. For an ongoing wine club, the user experience should be centered around consumer control—i.e., letting the consumer determine how many bottles of wine come in a shipment, the frequency of shipments, and when to receive them, on their schedule.
So, while a stylish website is not a bad thing, also look to investing in social media, as well as a website (and/or online store) that is intuitive and well designed from the perspective of the end user. (Some ideas for this here in our interview with Andrew Kamphuis of Commerce7.)
Targeting high-end consumers is not rocket science, but it does take an appreciation for their motivations and perceptions.
And, as we’ve hinted above, much of this perception is formed outside of enjoying the wine itself. It starts with engagement online, and follows through to the final mile delivery experience itself.
If you would like more help on crafting just the right experience for your affluent consumers when it comes to packing and delivery, reach out to us here at Copper Peak. We’ll help you get started.