As if we needed any more evidence that consumer perception of wine isn’t all that materially different than how they interact with every other produce available in the market today, the results of a study titled In Vino Veritas? Social Influence on ‘Private’ Wine Evaluations at a Wine Social Networking Site published by Wine-Economics.org provides more proof that wine is not immune from the same type of crowd-sourced review influences that have become the norm of on-line product searching.
The study was conducted by staff from Seton Hall, Oxford and the University of Exeter, from their departments of Diplomacy and International Relation, Experimental Psychology, and Psychology departments, respectively (if you want to go up against their level of smarties, be my guest; I know when I see a battle not worth fighting). Their subject was an analysis of Cellertracker.com reviews, which makes sense since it’s currently the largest such repository on planet Earth.
To the tape (emphasis mine):
“We conducted analyses based on 6,157 notes about 106 wines posted by wine drinkers at a wine social networking site. Our findings suggest that social influence on private wine evaluations occurred by communicating a descriptive norm via written information. We provide empirical evidence that there is social influence on private wine evaluations that is greater than the effect of experts’ ratings and prices combined. This influence comes mainly from the first few group members, and increases as a function of source uniformity. “
Hmmmm. Science and data deal uninformed, incumbent opinions a blow yet again…
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Last year, I wrote some OpEd on the 2013 version of Silicon Valley Bank’s annual State of the Wine Industry report. In that gonzo style (is there any other kind?!??) take, I made a prediction about the long-ish term future of wine sales in the U.S.. That prediction basically underscored a similar prediction I made in 2011 regarding how the current top dogs of wine buying in this country – the Baby Boomer generation – would fall off precipitously as they age in terms of no longer buying luxury goods like wine, either because they can no longer do this when they die, will not want to do it if they encounter failing health, or will not be able to do it because they will run out of money in retirement.
The 2014 version of SVB’s report (yeah, I know, it was weeks and weeks ago, I’m late), contains a very interesting statement in the “2014 Business Predictions” section, on page five (emphasis is mine):
“We believe we are trending to a transition point as Boomers hit retirement and the economic condition of the Millennials replacing them is burdened with high levels of student debt and weak job prospects. In the current period we expect to see continued growth in overall demand but only limited pricing power for producers. Within the next five to seven years however, the evolution from Boomers to Millennials as dominant purchasers of wine will prove a significant headwind to sustained growth in the wine business.”
In other words, SVB recently made you and me look like genius-level, Nostradamus-like oracles, since we’ve been saying this for nearly three years now, you and I. Okay, semi-genius. Okay, somewhat-smart-folks. Alright, alright, I will entertain the possibility that it was a blind-squirrel-finds-an-acorn thing. Also, few in the wine world appear to actually be listening to us (SVB excepted, of course!), so we may still be stoned to death, like some of the oracles of old. Best not to think too much about that…
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One of the criticisms most often levied against wine blogs is that they don’t “move the needle” in terms of wine sales.
Let’s forget for a moment that where I come from, coverage that costs me next to nothing for a product that results in even a handful of additional sales (and additional exposure) – that I otherwise would never have seen – counts for something.
The crux of this criticism is that coverage of wines on the virtual pages of wine blogs does not result in materially meaningful and/or measurable differences in the purchase volumes of those wines. Presumably, this is in comparison to similar mentions in print media (however, it’s worth noting that I’ve yet to see any hard evidence in the form of real data to support print media coverage having a sales bump effect, but I have anecdotal evidence from some California winemakers showing that it does not, as well as some from small producers indicating that some wine blog mentions have in fact increased DTC sales… which I can relay to you privately some day if we ever meet and you buy me a beer…).
The counter argument is usually a combination of two things: 1) that it’s extremely difficult to measure the impact of any media coverage on wine sales, regardless of the type of media, and 2) it’s the aggregate of blog and social media mentions (outside of concentrated special events, promotions, and the like) that amount to an increase in mindshare and small, one-consumer-at-a-time sales that otherwise wouldn’t otherwise have happened. In other words, wine blogging and social media mentions result in a stream of sales that are aggregated from tiny, rivulet-like trickles in combination, and so wouldn’t generally amount to a perceivable spike but do, in combination, make a difference. [ For an example of these arguments, see the mini-debate generated on this topic generated in the comments section of one of my recent posts here ].
I can now supply some data in support of that counter argument, by way of one example: namely, 1WineDude.com.
While I will not supply exact numbers (only because don’t have permission from all of the parties involved to do so), I can give you approximations that I think lend some credence and strength to the counter argument, though I strongly suspect it will be ignored by the wine cognoscenti, who have in my experience demonstrated a severe allergic reaction (sulfites got nothin’ on this!) to facts, data, and evidence if those things do not already support their own already-entrenched beliefs…
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