State of the Industry: A Consumer Perspective · 2011-01-31 · State of the Industry: A Consumer Perspective Unified Wine and Grape Symposium January 26, 2011 Francesca Schuler Chief

State of the Industry: A Consumer Perspective

Unified Wine and Grape Symposium January 26, 2011

Francesca SchulerChief Marketing OfficerTreasury Wine Estates

© Treasury Wine Estates – Proprietary and Confidential

Integrated approach is key to the future

Grower & Winemaking

Actions

Marketing &Sales Actions

Consumer &Market Trends

EconomicEnvironment


Reflecting on a few things we’ve heard this morning…

• Wine is an attractive category with growth outpacing the BevAl category and a key driver of overall retail sales growth

• Consumers have rephrased value—quality and experience are important components in their value equation

• Brands still matter, but consumers will continue to seek variety and discovery

• Increasingly diverse consumer segments, eg Boomers, Millenials, Hispanics


Meet Robert…


Meet Sophia…


Meet Jane…


So many consumer segments…

…how do we help them navigate the category?How do we engage them in our category for

future growth?


5 Consumer Principles

1. Give Me a Unique Experience

2. Speak to Me

3. Discovery Rules

4. Life is Sweet

5. Talk to Me Where I’m Listening


Give Me a Unique Experience


Yesterday’s Luxury


Today’s Luxury


The “New Luxury” shopper/diner

• Wine is viewed as an affordable indulgence

• Consumers want value: quality, experience and price

• Heritage brands, innovation brands and word of mouth are driving consumer preference

• Shoppers are shopping multiple channels for specific needs/occasions and in search of a great “experience”


While the basics still build brands…


…the bar has been raised and creating memorable experiences is key

VISIT

JOIN

FOLLOW

ENJOY


Other categories have reinvented experiences

FROM TO


360° Experience Approach

D2C

WineryHospitality

Direct to Consumer

Packaging

Wine

InfluencerMarketing & PR Advertising

Shelf

Promotions

Consumer


Tailored to each Channel and Occasion

Source: Food Marketing Institute; US Grocery Shopper Trends

Percent of shoppers who reported shopping the channel within the last 30 days…

111

101113

21

45

Super-markets

Club StoresSuper-centers

86

Specialty Stores

Discount Stores

Limited Assortment

Stores

DrugStores

Convenience Stores

DollarStores

(7)3-yrChg +10 --(1) +4 +1 -- ----


Exclusive Concert Creates the Ultimate Experience

Exclusive Music Drives Traffic for Customers

Marquee DisplaysGreat shopping experience

Facebook CommunityDrives Traffic to Stores & Shares

Love of Brand

On PremiseBuble Events &

Music & Wine Pairings

Consumer

Example: 360° Wine Experience


Implication: The experience starts in the vineyard and at the winery

• Tell your vineyard story in a consumer voice

• Bring to life the “little things” that make your vineyards and wines unique

• Evolve your experience to keep it fresh

• Flex your experience by channel and by consumer occasion


Speak to me


Category is still confusing and overwhelming


Target Desire Brand

Lifestyle brands who clearly speak to their target consumer are cutting through

Little IndulgenceA “Treat”


Clear understanding of consumer target and occasion

Target Desire Brand

Luxurious Indulgence


Compelling experience with consumer cues vs. industry cues

Target Desire Brand

Big, Bold, Irreverent


Implication: Consumer Centric vs. Industry Centric

• Outside-in focus

• Engage with your consumer and understand their desires

• Create unique consumer- centric brands that cut through


Discovery Rules


While discovery matters and is driving growth…


…core varietals and large, trusted brands are growing

CabernetSauvignon

MerlotPinot Grigio/

Gris

Chardonnay

59

Pinot Noir

51

10

9

Share ofCategoryGrowth

22

5

9

13

CategoryValueShare

20

0

15

8

Top 5 VarietalsPercent

Value GrowthPercent

+2.3%

+6.0%

+5.4%

+9.9%

IRI Momentum Brands ($5+)

Source: Nielsen Total U.S. Food/Drig/Conv/Liquor Plus; thru 12-11-2010


Discovery isn’t just about new…

The CoreAccessories—the fun and

discovery!!!


…but (RE)DISCOVERING something familiar

70’s 80’s 00’s


Consumers basket will skew to the Core, but also include new

• Chardonnay• Cabernet• Merlot• Pinot

• Argentina• New Zealand• Moscato• Riesling• Malbec

The Core Fun and discovery!!!


Implication

• Established brands must continue to evolve to stay relevant for the long term

• There is an opportunity to REDISCOVER California with innovative wine styles and refreshed brand propositions

• Cross-functional (viticulture/ winemaking, marketing, sales) collaboration is critical to succeed


Life is Sweet


Consumers are drinking more wine

Market volume per capitaGrowth CAGR 00 - 09

1.4%

(0.9%)

1.8%

(0.2%)

Spirits

Beer

Wine

Total

• Choosing wine vs. beer and spirits

• More and new occasions

• More confident in making wine choices


Lighter & sweeter wines outpacing market growth

6.4

9.0

9.2

9.9

4.1

Red Blends

Sauv Blanc

Riesling

Pinot Noir

Moscato 96.7

Top Growing VarietalsLatest 52-week value change, Percent

Source: Nielsen Total U.S. Food/Drig/Conv/Liquor Plus; thru 12-11-2010

Table WineAverage


Implication: Understand your consumers tastes

• Wine is a small indulgence

• Occasion expansion requires looking at different styles

• Evolution of style is a must


Talk to Me Where I’m Listening


Earned vs. Paid Media


Partner with All Gatekeepers

Trade Industry Influencers Consumer/ShopperInfluencers


Implication: Create conversations

• Actively engage with your target consumer where they are having conversations

• Understand ALL your gatekeepers and actively engage with them on their terms

• Build brand ambassadors to carry your story


5 Consumer Principles

1. Give me a Unique Experience

2. Speak to Me

3. Discovery Rules

4. Life is Sweet

5. Talk to Me Where I’m Listening


Thank You

Documents

State of the Industry: A Consumer Perspective · 2011-01-31 · State of the Industry: A Consumer Perspective Unified Wine and Grape Symposium January 26, 2011 Francesca Schuler Chief