How Evolving Consumer Demand is Changing the DtC Wine Industry

There may only be two certainties in life, but consumer preferences are still undoubtedly going to evolve over time. This is definitely true in the direct-to-consumer (DtC) wine industry. Whether consumers are pushing for greater sustainability, increased transparency through a brand’s marketing or want something else entirely, wineries must work to incorporate that into their approach to DtC channel building.

We’ll break down some of the top ways that changing consumer demand is pushing the DtC wine industry to look at new and more innovative ways of getting products to wine drinkers.

Changing consumer desire

Younger generations, specifically Millennials and Gen Z, are getting older and continue to have more purchasing power. But they have not typically led the way when it comes to DtC wine purchasing. We’ve previously discussed how younger generations have different wants when it comes to DtC wine. Silicon Valley Bank’s 2023 State of the Wine Industry report, working with Sovos ShipCompliant/Customer Vineyard data, found that consumers under the age of 60 have lower wine consumption. Over one-third (35%) of consumers aged 21 to 29 years old said that they drink alcohol, but not wine.

However, this doesn’t necessarily mean that younger generations will never want to partake in vino. It might just be a matter of meeting your consumers halfway. A recent Wine Enthusiast article interviewed those in the wine industry who were under the age of 40, with the experts saying anything from creative tasting experiences to improved social media presence to being more relatable and inclusive could all make a difference to younger consumers.

The latest vintage’s price point can also be an issue for Millennials and Gen Z. Our own 2023 Direct-to-Consumer Wine Shipping Report found that wines priced at $100 or more per bottle increased their volume shipped by 7.8% in 2022, while wines priced under $30 per bottle dropped in volume by 17.5%. This could be an issue of wineries not clearly communicating the product’s value, according to bw166. Overall, wineries cannot afford to ignore younger generations, and certainly not to completely discount them simply because they haven’t previously led the way in wine purchases.

Eco-friendly wine packaging

Eco-friendly options for the wine industry, specifically with regard to packaging, are becoming more common. For example, the North Bay Business Journal highlighted how one Sonoma County winery uses bottles that are 100% made from recycled materials and are slightly lighter than the standard 750 mL wine bottle – requiring less fuel to transport the product.

Companies focused on creating tasty, boxed wines are also looking to make a splash in the DtC wine market. One boxed wine startup told Modern Retailer that its packaging creates 84% less waste than glass bottles and wine can stay fresh up to six weeks after being opened.

On the regulatory side of things, while states do not necessarily ban specific container types when it comes to wine (i.e., glass v. cans v. boxes), there could be different tax scenarios that shippers would need to consider, as taxes on alcohol are ultimately size based. Additionally, states will have volume per shipment limits, but that is more to ensure that consumers are not purchasing too much of a product from a supplier at one time.

As wineries look into potentially adjusting their packaging, it will be important to stay mindful of all rules in the states in which they operate.

Transparent, relatable marketing

With a sustainability approach in hand, wineries can then focus on marketing that to its consumers – of all ages. Jason Haas, partner and general manager of Tablas Creek Vineyard explained to Wine Industry Advisor that engaging with customers on social media was key to finding out whether or not they’d find success using a lighter bottle. Overwhelmingly, they were fine with it, he said. Having something that would fit in their wine racks was their main concern, Haas said.

Tuscany winery Cantina Salcheto posts on its website the greenhouse gas emissions it’s saved, its water footprint, waste management and employee welfare.

“In the last four or five years, the [sustainable] message that we’ve been giving is much more impactful in our business,” Michele Manelli, Cantina Salcheto CEO and winemaker, told Wine Industry Advisor. “It’s more easily attracting clients, distributors, agents and brokers.”

A Commerce7 and Sovos ShipCompliant webinar earlier this year discussed the importance of how improved ecommerce approaches can also aid in the overall marketing approach for wineries. Building shipping costs into a bottle’s overall price can help to avoid sticker shock and cart abandonment, according to Commerce7. Offering a one-click checkout experience with a mobile wallet and ensuring that marketing emails target abandoned carts can also be beneficial.

Adjusting selling tactics to meet the evolving needs of consumers, whether that means innovative packaging or a refreshed marketing strategy, is not easy. But it’s becoming clear that wineries will need to account for it all.