U.S. Drinks Conference Redux

We had the pleasure of reprising the U.S. Drinks Conference for a trade delegation from Eastern Europe this week. The U.S. Commerce Department's International Trade Administration invited us to present a distilled (or should I say fermented) version of the conference to winery representatives from Moldova, Ukraine, Georgia and Armenia under the SABIT program. And if you can't put your finger on just where Moldova is, this map may help.

Only a few of the delegates spoke English so we had two interpreters who do simultaneous translation. That's a pretty intense task so they needed two to pass the baton every 10 minutes.

It was pretty hard to tell how well the audience were absorbing the arcana of the U.S.'s "Three Tier System", but the feedback we got from Tanner Johnson who coordinated the event (and was behind the lens in this photo)was that it was well received.

Mike Ginley of Next Level and John Beaudette of MHW did their usually brilliant job of putting things in perspective and I covered allocating marketing resources and also an overview of social media marketing. It was fun trying to explain Twitter and Facebook to someone unfamiliar with them. But my intro slide talks about Social Media having replaced porn as the #1 activity on the web, and that if Facebook were a country it would be the fourth largest in the world. So they might not have gotten the concept of why anyone would "Tweet", they did understand the scale of impact social media is having on consumers.


For any of my readers who will be going to Vino 2010 next week in NY, I'll be on a panel discussion on marketing wine to millennials moderated by Anthony Dias Blue with fellow panelists Kevin Zraly, Alder Yarrow, Susannah York and Doug Cook. Sphere: Related Content

Vino 2009

I had the honor of speaking on a panel discussion at last week's Vino 2009 event in New York on "Vintners' Access to the American Wine Market." (That's me hiding behind Lynn Walding.) Not surprisingly, the issue of direct-to-consumer shipments was the key point of debate. As we all know, distributor consolidation has exacerbated the situation further leaving few options for smaller producers, many of whom were among the 250+ exhibiting at Italian Trade Commission-sponsored event.

Tom Wark of SWRA (Specialty Wine Retailers Association) eloquently voiced his mantra that there ought to be a level playing field for consumers, as well as suppliers, distributors and retailers. The U.S. may be on the brink of becoming the largest wine market in the world, but the reality is that consumers in many states don't have access to more than a fraction of the wines currently imported into the U.S. because of the three-tier system. His point of view was countered by Jim Rowland of WSWA who reinforced the reasons why the current 3-tier system works. Lynn Walding who leads the Iowa State Alc. Bev. division gave what to me was the most compelling argument as to why the system is unlikely to change...money. The system may be archaic, dating back 75 years to repeal, but the grandfathered entities...Control States and distributors.. are powerful forces with a vested interest in maintaining the status quo. John Beaudette of MHW addressed the complicated registration process suppliers need to be familiar with to even get samples into the country.

One solution I've been a proponent of is e-commerce which is a way producers who can't get on the physical shelf, can at least get on the virtual shelf of many retail stores that have e-comm sites. And in spite of a couple of state law changes in MA, IL and KY to the contrary, I think it's a solution that ultimately may undermine the three tier system itself.

So stay tuned...with Amazon.com's wine initiative coming down the pike, the argument is definitely going to heat up. Sphere: Related Content

U.S. Drinks Conference 2008 An Outstanding Success

This was the second year that we’ve put on the event in London and this year we had a larger number of delegates from even more countries. The feedback we’ve gotten from attendees was overwhelmingly positive with frequent comments on the level of insight provided and comprehensiveness content.

The roster of speakers this year included some of the top executives in the American Drinks market including Rudy Ruiz, EVP of Southern Wine and Spirits, Vincent O’Brien, Senior Counsel at Nixon Peabody, John McDonnell, COO of Patrón Spirits, Bill Earle, President of the National Association of Beverage Importers, Roy Danis of AV Brands, and conference co-organizer John Beaudette, President of MHW Ltd. The subject matter included case histories and lessons learned by brands that have been successful in the U.S. and a wealth of data on the American market structure. Jeff Grindrod, Managing Partner at Brand Action Team, and Mike Ginley, President of Next Level presented results of “hot off the presses” research on consumer trends and preferences.

Several themes recurred through the conference including the impact of the global financial crisis on the Drinks industry, aligning distributor and supplier expectations, and the shift in marketing strategies toward more online and non-traditional spending.

Impact of Financial Crisis

“The economic crisis we’re going through is certainly having an impact on the business, but the research results clearly demonstrated that the U.S. beverage alcohol industry is recession-resilient,” commented Ginley of Next Level.
Grindrod added that “we see continued growth in volume and revenue, albeit slowing, and a shift in consumption from on premise to off premise. This is very timely data since much of the survey was completed in the two weeks preceding the conference.
Perhaps the most interesting thing we found is that for those folks going out to restaurants, the last thing they tend to cut out is the cocktail, wine or beer part of the meal,” he noted.

Aligning Expectations

Ruiz of Southern Wine and Spirits gave some well received advice to suppliers looking to export their brands to the U.S. “The key to a successful relationship between supplier and distributor is in aligning expectations,” he stressed. “When presenting new brands to Southern, expect to come in with a three year plan including a detailed one year operating plan with realistic expectations on case volume. It is more worthwhile to consider launching in smaller markets, proving your success with programming that demonstrates it’s repeatable.” According to Ruiz, the best demonstration of brand traction is when they see bars and retailers calling Southern and asking for the brand.

Evolution of Internet as Strategic Tool

Steve Raye of Brand Action Team brought home the importance of new online tools such as blogs and social media marketing for brand building. “It’s a noble goal to get visitors to your brand website, but at the end of the day, it’s more important to get your content out to where prospective customers already are spending their time…reading blogs, searching for recipes, reading comments on wines that other consumers have posted. Indeed, research shows that 65% of consumers read reviews online before purchasing a product.”

The US Continues As The Worlds Best Beverage Alcohol Market For New Brands

As John Beaudette summarized at day’s end, imports continue to drive growth across all beverage alcohol categories. “Considering the emergence of Eastern Europe, the Far East, and the rest of the world, we recognize that suppliers have many options in terms of investing behind new or existing brands. We hope we’ve clearly demonstrated that America is still the primary destination you should target”. Sphere: Related Content

U.S. Drinks Conference Next Week

Anticipation is rising for the U.S. Drinks Conference coming up next week on Oct. 14 in London. With the financial crisis roiling markets across the world, it's more important than ever to take a fresh look at brand strategies for the U.S. market. Jeff and Mike are working on the consumer trend information and just completing some surveys that will give us a look at sentiment and behavior as recently as last week. And I've put together a manifesto of sorts on the new realities of marketing in the America with tools (like this blog!) that reach and engage people on an individual level. And, we've got a boffo lineup of speakers from the U.S. including Rudy Ruiz, EVP of Southern Wine and Spirits, John McDonnell of Patron spirits and John Beaudette of MHW. And for the international perspective, we'll hear from Charlotte Hey, of The Drinks Business and Olly Wehring at Just-Drinks.com. So if you've been thinking about coming, get off the fence and go to http://www.usdrinksconference.com/ to register! Sphere: Related Content