Wine executives debate the promise and peril of millennial wine consumers
Top wine executives on Thursday offered differing views on the promise and peril of marketing wine to millennials, who are poised to overtake baby boomers this year as the largest generation in the United States.
Some are downright bullish about the prospects of increasing wine sales to the group of 73 million consumers roughly from the ages 23 to 38, noting their openness for new discovery and desire for authenticity.
David Duncan, chairman and chief executive officer of Silver Oak Cellars in Oakville, defended the potential of the millennial market Thursday during a wine conference at Sonoma State University.
Duncan told the audience of almost 500 that he disagreed with a recent Silicon Valley Bank report that dampened expectations on the potential of this customer base. The report noted “millennials aren’t yet embracing wine consumption as many had predicted” given their debt and competition form other products such as cannabis.
“I completely disagree. My experience is somewhat anecdotal, but we see it’s a family tradition. Young people are interested in wine and wanting to imbibe wine. I’m really excited about the millennials,” Duncan said during the 19th annual Wine Industry Conference sponsored by the North Bay Business Journal, which is owned by Sonoma Media Investments, parent company of The Press Democrat.
Ron Denner, proprietor of Denner Vineyards in Paso Robles, concurred with Duncan’s opinion.
Others were more measured on their take. Bob Torkelson, president and CEO of Trinchero Family Estates in St. Helena, noted that many millennials are saddled with debt that limit their ability to purchase premium wine. The average college graduate with debt owes more than $37,000 in student loans, according to Mark Kantrowitz, a nationally recognized expert on student financial aid.
“Maybe they don’t have any money. The prospect of them getting a better job is going to be difficult for a while. We face a lot of obstacles in this area. It will be interesting to see how we approach it,” said Torkelson, who leads the fourth-largest wine company in the United States.
Alex Ryan, president and CEO of Duckhorn Vineyards of St. Helena, said he agreed with Torkelson that either millennials don’t have the money or are just drinking wine more selectively. “I’m hoping that it is the latter,” Ryan said.
David Millman, managing director of Domaine Drouhin in Oregon’s Willamette Valley, said only 6% of his winery’s business comes from millennials, as many of his wines are aimed at a higher-end market, about $35 to $100 a bottle. But he is hopeful wineries that target the generation with authentic marketing could ultimately succeed.
“In time, they will come around,” Millman said.
You can reach Staff Writer Bill Swindell at 707-521-5223 or firstname.lastname@example.org. On Twitter @BillSwindell.