In a world where alcohol is losing ground to no-and-low beverages and even cannabis, Natalie Earl explores how Millennials and Gen Z are reshaping the wine industry.
The wine industry is at a crossroads, facing declining global alcohol consumption, especially among younger generations. Understanding the reasons behind this trend—health concerns, social media influence, increased variety and choice, and financial insecurity—could help the industry adapt and survive.
Health-Conscious Consumers
Health and wellness trends are driving moderation and abstinence. Strong messaging about the negative health impacts of alcohol, supported by the World Health Organization's assertion that "there is no safe amount of alcohol that does not affect health," has intensified the debate. Gen Zs (born between 1997 and 2012) and Millennials (born between 1981 and 1996) are particularly health-conscious, with many seeing even moderate drinking as unhealthy. According to marketing intelligence agency Mintel, about a third of Gen Zs in the UK do not drink at all.
Social Media Strains
Social media perpetuates these sentiments, showcasing a lifestyle of health, fitness, and success that often excludes alcohol. Jarlath Curran, Decanter’s wine logistics manager, notes that social media has changed perceptions of success and a good life, making alcohol seem less compatible with these goals. Ben Franks, COO of Canned Wine Co, echoes this, highlighting the pressure to maintain a healthy image online.
Paparazzi Problems
The desire to avoid public embarrassment and maintain a polished image is another factor. Sophia Longhi, founder of the blog Skin + Pulp, points out that Millennials and Gen Zs are wary of the repercussions of public drunkenness, especially with the permanence of online records. Increased awareness of women's safety also deters younger drinkers.
Cultural and Social Changes in Drinking Habits
Drinking habits are changing, with more people choosing to drink at home rather than in bars and restaurants. This shift, noted in Liberty Wines' 2023/24 premium on-trade report, highlights a trend towards valuing quality over quantity. Social gatherings are now seen as special occasions, prompting a desire to share good wine and food. Millennials and Gen Zs are also oversharers, both online and in person, making their drinking experiences more meaningful.
Drinking Less but Drinking Better
Economic factors also play a role. Younger generations are spending more on less, prioritizing quality over quantity. Ellen Doggett, a Millennial wine industry expert, notes that despite declining drinking rates, the value of wine sales is increasing. Financial crises have left younger generations with less disposable income, making them more selective about their purchases.
Buying Habits
Values like provenance, sustainability, authenticity, and heritage drive the purchasing decisions of Millennials and Gen Zs. This focus on quality over quantity benefits the wine industry, which applauds the decline in cheap, bulk wine consumption. However, there is concern that this trend could make wine seem elitist and unapproachable.
An Ocean of Choice
The variety of alcoholic and non-alcoholic beverages on the market offers ample choice for experimentation, pushing wine out of the spotlight. Non-alcoholic options like kombuchas, low beers, and mixers are particularly compelling. Additionally, cannabis use among Gen Zs in the US is replacing alcohol, with many states legalizing cannabis and a rise in CBD- and THC-infused ready-to-drink (RTD) beverages.
Lifestyle Generations
Despite concerns, industry professionals remain optimistic about the future. To attract younger generations, the wine industry must embrace innovation, sustainability, and alternative formats. Anne Burchett, a wine marketing specialist, emphasizes the need for constant creativity and renewal to keep wine relevant. Wine as part of an aspirational lifestyle, rather than a symbol of overindulgence, appeals to Gen Zs. The industry should demonstrate how wine can fit into their lifestyles without overcomplicating it or forcing traditional pairings and situations that they can't relate to.
By aligning with the values and preferences of Millennials and Gen Zs, the wine industry can adapt and thrive in a changing landscape.
Source: Decanter