Myth: Millennials are driving fine wine sales

(Starkinsider) - We commonly hear on the Internet and across various media and analyst sites that Millennials (21 – 34 years old) are driving fine wine sales.

Not so.

According to Silicon Valley Bank’s Rob McMillan (an informative guy to follow if you like to stay up to speed on wine industry trends), this is not true. He calls it the “Millennial Myth.”

From this market update on the “SVB on Wine” blog, he notes:

“What is true is the Millennials have the highest growth rate, but like all segments with low numbers of consumers, the high growth is because of the small base versus the growth in the nominal consumption of the segment.”

McMillan implores wineries to adjust not only marketing budgets depending on what segment of the market they are targeting, but also to think about the distinction between “willingness” and “capacity” to buy. A twenty-something might have the willingness to buy that 2001 Silver Oak Cab, but do they have the capacity?

In other words, don’t market to people who can’t afford your product.

Boomers are the wealthiest generation. But for marketers, at least of wine, there’s a paradox. “The problem,” writes McMillan, “is the older generation doesn’t have the willingness – or maybe the kidneys – to be a dominant cohort in wine sales.”

So if the Millennials have the willingness, but not the capacity, and if the reverse is true for Boomers, what to do?