The marketing of super premium wines
In a recent edition of Off Licence News, Tim Atkin asked for a “re-evaluation of what constitutes fine wine”. This followed his plea that certain wines of the Languedoc should receive greater recognition. Other commentators might well echo his sentiments but champion the cause of other regions. For my own part, I am indirectly involved in the attempts of English sparkling wine producers to be perceived as on a par with the top Champagnes.
Whatever the region, any producer that seeks to break into the ranks of established fine, or super-premium, wine brands has a real task on their hands, given in many cases their strong trade and consumer franchise. As a first hurdle, the quality of the actual wine needs to reach a level where it achieves endorsement by opinion formers. Commensurate with that, an appropriate sales and marketing programme needs to be developed, and then consistently implemented over a number of years to optimise the chances of success.
The anti-laws of marketing
This came to mind as I belatedly read a critique by Louise Jack of The Luxury Strategy – published in 2009 – which argues that luxury brands should throw away conventional, tried-and-tested marketing principles .The authors in fact propose 18 “anti-laws of marketing” for such brands to follow.
The recommendations have clearly sparked some controversy but what I found interesting was that many would come across as straightforward common sense to successful fine wine producers. Certainly when it comes to English sparkling wine, they should be part of any producer’s strategy. These in general relate to the “anti-laws” surrounding sales and distribution.
For example, my advice to producers who are not already doing so, is to talk about allocating as opposed to selling, and ideally never allow the customer the full amount requested.
If you are building volume from scratch, distribution should ideally be rolled out just ahead of availability so that one can more easily protect scarcity value. As a maxim, I note from personal experience that scarcity value tends to be only fully appreciated after it’s lost. So it must be protected and nurtured.
On pricing too, their recommendations make sense. Producers should “raise prices as time goes on in order to increase demand”, or when competition develops, as opposed to discounting. For luxury brands, and contrary to the rules of demand-based marketing, “first you come up with a product, then you see at what price you can sell it. The more it is perceived to be a luxury, the higher the price should be”.
Anti-law 18 also strikes an obvious chord: “Don’t relocate your factories. When someone buys a luxury product they are buying a product steeped in culture or in a country. Having local roots increases the perceived value of an item”. How familiar this all sounds, particularly when one considers Bordeaux and Burgundy.
These two regions came to mind too when I read Anti-law 2. “Does your product have enough flaws? In the world of luxury, products must have character and originality. Flaws can be unique and so boost an item’s desirability”. Perhaps Burgundy’s reputation for inconsistency adds value, whilst vintage variation assuredly does so across the whole fine wine sector.
Bring on the grumpy old men
More interesting still is Anti-law 3. “Don’t pander to your customer’s wishes .Traditional marketing listens to consumers, transforming their wishes into global products. The luxury brand, by contrast, comes from the mind of its creator, driven by long-term vision”.
This reminded me of a brainstorm held in southern France a few years ago, to consider a generic strategy for the region’s wines. At one point James Herrick suggested that the following tagline underpin the campaign: “Great Wines From Grumpy Old Men”.
The thinking behind this would have been appreciated by the authors of The Luxury Strategy even if it clearly wasn’t on the day. The concept of producers making wines that they thought were right for the terroir, as opposed to what the consumer might be demanding – and then deciding they might allow you to buy a bottle or two if they weren’t at lunch or playing boule – would have been a perfect marketing story, at least at the super-premium end.
Can you sell super premium wines online?
The only major surprise in the article was the authors’ view that luxury brands should communicate online but not indulge in e-commerce, which is “inconsistent with true luxury values”. Perhaps this simply demonstrates how online marketing has moved on since 2009. My advice to wine producers would be to sell as much as possible online whilst being sensitive to one’s agency network.
Certainly if you are an international producer selling into the UK, then developing a direct and close relationship with consumers here is not only much easier online but helps you stay in complete control of the message. This in turn facilitates optimising the price, which helps reinforce the brand’s value. Online selling also facilitates building a loyal database which gives you the option of selling – or should I say allocating – your entire production direct at some future date.
In overall terms, however, the message of the book is clear. Simply getting the quality of the wine to a point where it is endorsed by the trade is only part of the battle. To realise the wine’s full potential in terms of status and profitability over the long term implies that the decisions you take on pricing, trade and consumer communication and distribution strategy will be absolutely crucial.
Whether you decide to call this thought process marketing or anti-marketing is ultimately irrelevant.
I think this article, is exactly in line with that philosophy: http://www.thedrinksbusiness.com/2013/01/pommery-sells-dreams-not-disgorgement-dates/?article-source=newsletter&source=506&date=2013-01-28