Consumers are not envious

Rob McMillan, EVP & Founder of SVB Wine Division, opens the State of the US Wine Industry 2025 report with an assertion: “The business is not merely an occupation; it’s a passionate pursuit, rich with sensory experiences, social connections, and profound personal meaning. For those of us lucky enough to work in the industry, those are a few of the reasons we chose this path as a career. For the consumer, those same characteristics ignite envy in those not immersed in the business. It’s that mysticism that calls them to enter this idyllic realm we call wine country.”

As it relates to why people work in the wine industry, Rob is correct. However, respectfully, as it relates to consumers, Rob is not correct. Today’s consumers do not envy us. They do not envy much, but we’ll return to that later. He’s not alone in this belief that consumers envy wine country lives, passions, and communities. It comes from millions of visitors, tens of thousands of club members, and thirty years of unrestrained expansion. It comes from a boomer generation full of conspicuous consumption, limited access, and desires to escape urban office parks. However, this navel-gazing is consistent with yesterday’s product-centric worldview. You could imagine the same naiveté (or hubris) from Bora Bora, the Maldives, or Paris travel centers. Or from fashion executives at Dior, Louis Vuitton, or Hermes. Or from promoters of the Super Bowl and the Olympics. Or from Swifties.

The issue is not pride in community, career, or craftsmanship. Everyone in the wine industry should be thrilled about their life choices. The problem lies in assuming that every customer secretly wishes to be like us. This naval gazing leads to a narrow understanding of the significant changes occurring across consumer segments that will shape our future. Rob accurately states, "We are rotating out consumers who index higher for wine purchases compared to other alcoholic beverage categories, replacing them with consumers who index lower for wine." However, age isn't the only factor. Generation X/Z and Millennials are not particularly enamored with “the world of wine.” If they want wine, they want it integrated into their world. Into their lives. Into compelling experiences that touch them where they are today. We, in the wine business, are obsessed with yesterday. You cannot throw a stone in Napa Valley without hitting someone talking about the Judgement of Paris, André Tchelistcheff, the first California AVA, or Charles Krug’s 1861 winery. Unfortunately, Generation X/Z and Millennials care little about yesterday. Let me illustrate it.

In 1976, Apple Computer was launched, Jimmy Carter became president, the bicentennial was celebrated in my hometown of Philadelphia, and California wines gained recognition at the Judgment of Paris. In 2025, very few Gen X/Z or Millennial consumers care about any of these events. If they cared about any of them, one could easily argue that Apple’s launch is far more significant to the 1.4 billion people currently using iPhones than the few million travelers visiting the Napa and Sonoma Valleys this summer. Why? Apple reaches into the past to demonstrate how it has transformed today’s world. An iPhone 12 has more than 100,000 times the processing power of the technology that landed humans on the moon in 1969. It is over 5,000 times faster than the CRAY-2 supercomputer, the best 1976 computer. The iPhone can perform 11 trillion operations per second, while the CRAY-2 managed 1.9 billion. Apple can make this history somewhat relevant to the 1.4 billion iPhone users today. Meanwhile, for most consumers, wine is wine. Fifty years later, it remains confusing, oversaturated, and self-obsessed, and for today’s consumers, it’s less appealing than CBDs, ready-to-serve drinks, and sobriety. It’s not our fault. It’s our reality.

Moreover, the context regarding how different generations consume information has transformed. For Boomers, acres of legacy marketing data reveal how they made (and continue to make) purchase decisions. They prioritize what the brand says about itself, what influencers and advocates share, and finally (a distant third), what friends and family say about a brand. Today, for Gen X/Z and Millennials, that paradigm has completely flipped. What brands say about themselves now ranks as a distant third. Consumers view self-importance and self-promotion as outdated. Marketing promises often go unheard or unbelieved. Branded messages frequently contradict today’s critical demands for authenticity, trust, and transparency. Since most of the wine content is product-centric, and since we believe everyone secretly envies us, the pivot to Gen X/Z and Millennial consumers is increasingly challenging.

At the same time, the distinction between “friends and family” and “influencers” has become completely blurred. Politicians, movie stars, athletes, authors, industry leaders, civic leaders, musicians, and social advocates utilize social media, podcasts, livestreaming, and other forms of digital engagement to create platforms resembling collections of friends and family (circles of influence, pods, cohorts, etc). Our neighbors (and their children) have become publishers. Gary V. was a retailer in Springfield, New Jersey, when he started, and now he’s one of a thousand influencers shaping your brand's market value. How many of you have turned customer service into a “thank-you” department? Maybe you should have done it when Gary subtly told everyone during the 2011 Symposium, “It is time for every single person in this room, no matter what your brand is, to take full control of your brand and engage directly with the consumer. Don’t be in the position where you’re at the mercy of anyone between you and the consumer.” If you had taken Gary's advice, you would know firsthand that Rob is incorrect about their level of envy.

Why it matters

While I appreciate Rob’s use of “sunsetting” over “dead”, the truth is that a thirty-year run powered by boomers is ending. It’s not a rollover. Not a trade out. It’s an extinction. We cannot turn the page. We must open a new book. According to Rob, the Great Boomer Expansion is being replaced by “younger consumers above 30 (who) have tried wine and have an opinion. We aren’t initiating raw novices. We need to convert those who already have an established opinion and values, including preferences for other beverages–alcoholic and nonalcoholic alike- over wine. That is a more difficult task, but it’s the critical one at hand.” Most importantly, these new consumers are not their parents or grandparents.

Gen X/Z and Millennials are not an extension of anything you’ve encountered. They are not constrained by their parents’ ambitions, trappings, or identities. As digital natives, they consciously reject conspicuous consumption, criticizing the perceived detached attitudes of older generations towards technology, social issues, and work-life balance. They contend that baby boomers are overly fixated on material possessions and traditional values, failing to grasp concerns related to climate change and social justice. This mindset fosters well-documented backlash against legacy consumption habits and cultural preferences. They prioritize authenticity and experiences over mere products and services. They seek personalization and data privacy. They value principles as much as price. Most troubling is that winery branding, marketing, sales, influencer strategies, and PR efforts are ill-equipped for these transformative changes.

In previous brand articles, I’ve discussed the concepts of “mirrors and windows.” During numerous brand workshops with senior executives across various industries, I’ve urged leaders to confront the biases and prejudices inherent in brand perception. They define their brands (essence, truths, values, etc.) and customers (wants, needs, desires, objections, etc.) through lenses of their own construction. While they claim to leverage research, analytics, focus groups, and other data to form informed opinions and address issues clearly, they often spend much of their time gazing into a mirror to see themselves. Transitioning from mirrors to windows is difficult when one believes the world envies them, their job, and their industry. There is no more incredible difficulty related to attracting new consumers, but this is exactly what you must do.

Consider your brand essence wheel: the upper half describes the functional aspects, detailing the brand, what it does, and how you would characterize the product. It reflects (like a mirror) your business. The lower half is emotional; it illustrates the relationship between the brand and the consumer, beginning with the brand's personality and then shifting to the consumer's perspective. It explores how the brand influences the consumer’s image and emotions, providing customer-centric insights. Most wine marketing fail to reach the customer-centric insight stage, primarily focusing on functional attributes. This is navel-gazing. I will never forget when an industry executive said, “We’ve decided that all our brands focus on one audience persona – upwardly mobile, soon-to-be empty nesters, foodie boomers with plenty of disposable income and healthy travel budgets.” I wanted to ask why they needed more than forty brands to serve just one audience, but I thought better.

The State of the US Wine Industry 2025 report addresses the consumer transformation over the next decade. Rob explains, “The key issue to grasp in this era lies in the contrast between the preferences of older, high-spending wine consumers and the emerging 21-year-old demographic…to mitigate the decline of older consumers, we must rethink and enhance our approach with the 30-45 age group and improve our share among beer, wine, and spirits in that cohort.” While accurate, it misses that the fundamental transformation from boomers to younger generations is a shift on personal values. These data points provide perspective on the change:

• 55% of consumers want every interaction to pick up where the last interaction left off.  (Bain)
• 71% expect personalized experiences (Mckinsey)
• 76% say personalization makes them more likely to purchase or repurchase (Mckinsey)
• 86% say that personalized CX increases loyalty (Google)
• 90% say “trust, satisfaction, excellence, & authenticity" are the most essential brand attributes (Prophet)
• 95% of C-level execs believe customers are changing faster than their business can react. (Accenture)

Herculean transformation is required to meet the moment. As Rob states, “The fundamental underpinnings that created the industry growth are changing, which means the tactics relied upon to ride this wave of success to this point will slowly prove flawed without business adaptation. To continue its growth in the years ahead, the US wine industry needs a new direction and a changed focus.” This change of focus requires that we put away the mirrors and start to understand the window driving today’s younger consumers. It is a fundamental shift from “product-centric” to “customer-centric” values.

Next-generation customer-centric wineries

Customer centricity isn’t simply about "the customer is always right” or catering to every demand. It's also not about customer service. It's about aligning your business offerings (products, services, experiences, and values) with the needs and desires of your most important customers. It entails doing the best thing for the best customers, understanding why they are the best customers, and providing trust, empathy, care, and anticipation to ensure they remain your best customers. Only this aligment ensure that the business canoptimize long term financial success. Customer-centricity involves grasping what subscription, loyalty, travel, food, alcohol, experiences, and relationships means to them in 2025, not what it meant to us from 1990 through 2024. It’s not about the envy we felt catering to mostly boomer club members, but rather the shared experiences we can conjure up in their lives today, wherever they are - while ensuring that doing so provides the most value for our businesses. Most importantly, it’s about treating them as individuals. Providing customer-centric experiences to Gen X/Z and Millennials that enhance customer service (thank you!), concierge, and hospitality wherever and whenever it is needed. It's about forging and maintaining connections that flourish over time and at a distance. It’s getting out of our bubble and jumping into thousands of their bubbles.

Peter Fader, a Wharton professor and author of the Customer Centricity Playbook, explains that “the requirement behind customer centricity is the ability to understand customers at a reasonably granular level and to identify the customers or segments of customers that are valuable from those that aren’t. Then, you must develop the operational and organizational capabilities to deliver different products, services, and experiences to various customers.” He emphasizes the concept of heterogeneity — the reality that different customers will have widely varying CLV values. In a customer-centric ecosystem, everyone is not simply an “upwardly mobile, soon-to-be empty nesters, foodie boomers with plenty of disposable income and healthy travel budgets.”

Unfortunately, many wineries will find this level of personalization and customer-centricity overly complicated and nearly impossible to execute. Fader admits, “(Most brands and retailers) don’t want to think about it and tend to oversimplify. They overlook some of these distinctions and apply a one-size-fits-all approach to all their customers that doesn’t adjust based on the business model. This leads to a garbage-in/garbage-out situation.” While Fader is undoubtedly accurate for many brands and retailers in the wine industry, his perspective on customer-centricity also articulates a roadmap for any winery that dares to be brave and meet the moment. Here is my list for getting started. While it’s not comprehensive, it’s a starting line for wineries who want to meet next generation wine consumers where they are today.

Consider the following:

1. Hospitality: Shift the tasting room from wine tasting to immersive experiences. Move beyond the flight in a cave, dining room, and scenic views. Be inquisitive and exude the bottom half of your essence wheel. Put your wines into their lives. Add a unique and ownable personality to your winery and tasting settings. Dare to do what nobody else does. Explore the possibility of building a relationship with the customer after they leave the valley. Make a friend.
2. Concierge: Develop recurring 1:1 relationships between individual brand ambassadors and customers – not simply for outbound emails and birthday wishes, but to build a lasting relationship; become their “guy or gal” in the wine industry; let them engage digitally via voice, livestream, text, chat, or email. Get your teams to think and act like personal shoppers. Transform your DTC team into a Direct Selling business, like Stella&Dot or Cabi.
3. Club/Subscription: Transition your club into modern commerce, with the customer in total control of when, where, what, and how wine is sent to them and their friends. Like Amazon Prime, shopper convenience, personalization, and adaptability become the primary focus. Move away from a fulfillment model that forces consumers to engage on your schedule (and the limited capabilities of wine pick and pack). Let consumers feel like they are members of an exclusive experience that they own. Think like a customer.
4. Off-premise/On-premise: Make CPG feel like hospitality and DTC. Become trusted advisors at the retail level and take responsibility for helping retailers and restauranteurs expand their businesses; develop 1:1 B2B relationships with the same passion as B2C relationships. Triangulate regional club members with restaurants and specialty shops carrying your wines; set up virtual events and secret societies. Make your brand matter to them and their business.

Our team at Umego.ai is spearheading a personalization renaissance across trusted advisor industries like wine and spirits. We leverage customer-centricity to understand consumer needs and behavior at depths unknown since the death of the corner store. We generate local, personal, forward-looking, and long-tail customer knowledge. We extract intelligence lost in the market today and expose, harness, institutionalize, and activate that intelligence to optimize predictive brand experiences and drive revenue at scale. Umego helps brands put customer at the center of every experience, and we do it in a way that marries compatibility and sustainability with scalability and repeatability.

Learning why consumers behave as they do requires the art and insights of human interaction—trust, kinship, listening, caring, empathy, nurturing, and anticipation. By going beyond “first-party data” to “first-person experiences,” Umego unearths why individual customers behave the way they do and leverages this intelligence to develop more innovative and efficient customer-centric models. Algorithms are prioritized to ingest knowledge, learn, be inquisitive, and propel users toward relationships with the brand. This intelligence helps us understand which wine customers will likely be the twenty percent driving eighty percent of the value. By taking a customer-centric approach to the journey, Umego empowers brands to see through the eyes of their most important customers and plan accordingly.

The fundamental underpinnings that created industry growth are changing. The tactics relied upon to ride this wave will fail without business adaptation. The US wine industry needs a new direction and a changed focus. It must meet this generation where they are, not where we are. It must see the world through a next-generation window, not our thirty-year mirror. We must accept that most do not envy our lives, careers, or communities. The youngsters want to drop in for a visit. They want you to follow them home. They expect exceptional and personalized luxury experiences. They want authentic relationships that meet them where they live. They want craftsmanship aligned with sustainability and a passion for the land. They will not accept a 1990s version of the club, membership, or subscriptions. They crave choice. They demand quality. The love experiences, personalization, and individual respect. We are not turning the page in the wine industry, we’re writing a new book. It’s a brave new world.