Less Talking, More Listening, Better Understanding.

Last time, I discussed the wine industry status quo. I also broached the idea that consumer-focused businesses can ensure go-to-market mismatches, such as those seen in the wine industry today, don’t happen in the future.

I believe this because, at a consumer-focused business, all strategy and operations decisions extend from a pervasive, vigilant awareness and understanding of the consumer's highest priority desires. Gamification helps drive an ongoing understanding of consumers and can feed a virtuous cycle of symbiotic change between consumers and businesses that serve them. The ultimate result is more value for all parties.

I started with the industry status quo and consumer-focused business basics because consumers in the wine industry have seen too little change for far too long. From my perspective, the industry has turned a blind eye to the growing population of consumers defecting. My mission is to leverage gamification through Somm Says to aid the industry in overcoming the acute challenges faced in regaining the trust of Millennial and Gen Z consumers. But, the lessons I’ve learned along the way have impacts far beyond the application of gamification concepts in the wine industry.

Wine industry challenges are not unique.

The consumer-side sense of deficiency in an industry's overall go-to-market strategy isn’t unique to wine. Other industries struggle to keep abreast of their customer’s actual needs.

Mary Barra, GM’s CEO, is a personally observed example of how businesses have gotten it wrong. She once spoke to graduate students in an auditorium at an elite university in the mid-2010s. Her message to students that day differed from her public remarks at the time. After taking the helm of GM to champion more fuel cells (laughable in hindsight) and EVs, she openly denounced the value of the user experience offered by EVs with touch-focused driver interfaces. She pulled up to the school that day in a Corvette. Half a decade later, she was still sticking to her guns, dismissing the very lessons those students were attempting to teach through their questioning. It’s a wonder why younger consumers don’t want to drive, nor do they consider GM vehicles competitive.

Given Tesla’s success at the time in appealing to young, high-value consumers, a few students challenged her stance on the EV-verse-ICE model and software’s role in optimizing the driver experience post-sale. She routinely dismissed EVs and “sterile driver experiences,” such as Tesla’s. She took a jab at the Tesla driver experience and expressed that such user experiences are a fad. She downplayed the need for intuitive, touch-native, constantly updated driver experiences augmented by software enhancements. Is there any doubt remaining about how flawed her thinking was at the time. And, it may still be flawed today, at least in my mind and those of Morgan Stanley as of last year’s assessment.

Another ready example is our politicians here in the US. Those setting laws and spending priorities out of technological and social ignorance adversely impact multiple future generations. Relive politicians trying to question Facebook executives for a good laugh.

These examples tell us that the change required to overcome latent and incipient mismatches between industry leaders’ ideas of how to go to market and the demands of consumers within that market can take a long time. The wine industry, however, faces something uniquely acute that must be solved quickly. Those solutions must be derived from the perspective of the generation’s consumers experiencing these adverse impacts.

Less talking, more listening.

If the wine industry were a person, I would imagine them asking very peculiar questions when confronted with the apparent need to change. Why should we move on from focusing on late-night business dinners at fancy restaurants, usually with all men? Or, why consider how social interactions take place in the context of a more digital society when we want in-person interaction on our terms? What about the personal value of transparency and authenticity in our messaging? It hasn’t been needed, why are these things needed now?

Cue an image of an old hand in the industry lamenting the “good ‘ole days,” and you get the point. Instead, we need to continuously look at how formative experiences are constantly changing and be open about the opportunities and threats presented across generations.?I've heard some form of this lamentation from many tasting room managers when I ask if they are listing to their consumers today:

"We talk to all our customers, all the time. They love telling us what they think. But we still don't quite understand younger consumers."

No shit! How often have you been at a dinner table with friends in a restaurant and you get the "recommended" beverage or meal only to discover it's not what you expected. Some consumers will speak up, but most, especially younger consumers, will smile, nod approvingly, and say "it's great," only to turn around to their fellow diners after you leave and reveal the truth. The digital and dopamine generations of Millennials and Gen Zs, respectively, are defecting from wine for very manageable reasons: we are talking too much and not listening well enough.

In the wine industry, a lack of appreciation for understanding consumers' formative experiences likely explains some of the reasons our senior business leaders fail to adapt to recurring generational struggles: they didn't need to be good at listening to be successful. To the wine industry leaders today, it seems that a contemporary consumer’s professional, social, and personal identity must revolve around the same things it did 20 or 30 years ago.

Sure, businessmen - and they were mostly all white men back then - loved to speak up at a restaurant and let a server or sommelier know what they really thought. Younger generations, however, rocked by a constant string of social, environmental, economic, health, and conflict-related disruptions over the past decades, aren't as excited about telling a complete stranger what they really think. That's doubly true when there is an underlying element of interpersonal conflict.

Do you know why drive-thru customers at a fast food restaurant will order 10%-15% more when they go through the drivethru? They don't have the suppressive effects of risking personal judgement by a stranger while looking into the eyes of the cashier as they request a super-duper-double-size fries and an extra-large soda to go with that half-pound burger.

When that same consumer is online, and don't even have to risk the judgement in another human's voice, they will often order 10% more than at the drive-thru. Talking directly to you customers isn't always the best way to listen, let alone make a sale. The fast food industry learned this decades ago. It's professionally negligent, at this point, for wine industry leaders to continue to refuse to acknowledge best practices that are decades old and transcend most other industries.

Instead of talking at consumers, we should be talking with consumers. We have to start by listening at real scale, to the consumer's inner voice. Listening at scale means developing tools to engage and understand consumer behavior where it matters. We, as an industry, can pour all the money we want into point-of-purchase consumer decision-making or flashy slogans, but it won’t have the effect we want. Better shelf-talkers, more prominent ratings from anonymous organizations, and better label design aren’t what matters any more.

No wonder consumers have a lingering suspicion of any point-of-purchase signals of value in the wine industry. Instead, we should look at what happens around the kitchen table, in your customer’s backyards at a barbeque, or on a weekend getaway to a cabin in the mountains with friends. That’s where consumers are engaging with wine substantially, not just superficially. That’s where the label stops mattering, and what you think of the wine in your glass becomes the only meaningful measure of a brand’s value. That's where we should be focused on listening the most.

We want to be there in these situations because that’s the first place we, as an industry, can detect signals of consumer preference changes. It is the first place where we can detect how one generation’s experiences with a product begin to give way to the next generation’s. We can even detect when a consumers starts to make the well-known shift from sweeter wines to dryer ones.

Moreover, as the global economy is increasingly impacted by rapid, exponential change driven by higher-level technologies, an appreciation for the psychology and sociology of consumers’ formative experiences yields incredible commercial value. We can even listen as different groups of consumers, across social, geographic, or economic lines, are impacted by inflation or other micro- and macro-economic factors. Enter the emerging discipline of behavioral economics.

As someone who grew up as an “elder” millennial, I saw the impact of technology as it came to the forefront of our consciousness. I was one of the few people with the privilege of having a car phone and had the benefit of parents who worked in banking software when the word “mainframe” was commonplace. Then, when I dropped out of an electrical engineering program at college to join the US Army as a Green Beret in the early 2000s - in a fit of youthful patriotic naiveté mind you - I became one of the many soldiers that could intuitively navigate the rapid technological transformation happening between 2003 and 2013.?

Don’t read too much into this. I was successful merely because I knew how to type fast, use PowerPoint, and have an intuitive sense of how to program a VCR. I only point this out as bona fides that, as a young child and young adult, I supported the Greatest Generation and Baby Boomers adapting to technology long before they needed help adapting to consumers like me.

I can also tell you that I only have a rudimentary understanding of the dopamine drivers that truly engage Gen Z consumers. That’s why I created Somm Says, to help me better understand consumers in a way that can also benefit the wine industry. After all, our job as an industry is to turn a rudimentary understanding of generational consumer interests into a more beneficial and comprehensive one that yields value for everyone.

The Digital and Dopamine Divides

You may not be alone in wondering why I distinguish “digital” and “dopamine” when discussing the differences between Millennials and Gen Zs. I use those specific terms because they allude to the formative experiences that have shaped the different perceptual frames through which these consumers experience the economy. A generation’s formative years can significantly impact their approach to consumer choices. The wine industry is about to get a crash course on this phenomenon.

I differentiate generations between descriptions of digital and dopamine because while my generation experienced the digital economy transformation of the late-90s and early-00s, it was rough and raw. One may say, unrefined or unoptimized. There were ways to enjoy yourself with digital technology during that era, but for many, digital tools were just that: tools.

For millennials growing up, we formed our frames through which we evaluate the world without appreciating or truly mastering the effective, and sometimes too effective, ways in which human psychology, our society, and our economy would learn to capitalize on the new-found digital experiences. Millennials grew up in a world where no one talked about the most addictive drug waiting to be unlocked by our new-found digital capabilities: dopamine.

Those in the early gaming and media world would vehemently disagree with the idea that dopamine wasn’t part of their lexicon at the time. So too, would tobacco and alcohol execs from the period. We’ll return to this era of gamification and media in future articles. For now, let’s move on and take as given that most of the global economy and its leaders back then didn’t appreciate the role dopamine would play today in our everyday lives, minute-to-minute, screen-to-screen.

Unlike the Millennial generation that grew up on raw, unrefined digital experiences, Gen Z has grown up with touch interfaces, gamification, and algorithms as the dominant formative technologies. And, because computers can provide thrilling, infinitely variable, always relevant, and impossibly engaging content, Gen Z has had more interactions with other humans and businesses over digital devices than any previous generation. In some cases, younger Gen Z consumers have more interpersonal interaction over digital experiences than they do “IRL,” as we used to call it in the early days of online dating.

Remember, I grew up being told by my parents and elders not to meet strange people on the internet, much less get into cars with them. Today’s parents sometimes don’t understand why their children as young as pre-teens need to be picked up when they can hail a stranger to come and pick them up in their car via Uber or Lyft.

With each successive advancement - PCs, digital telecommunications, mobile devices, the cloud, etc. - businesses have had to adjust to the changing demands of consumers constantly. That’s not new. What is new is the pace and scale of consumer changes happening between and even within generations. And, with it, consumers have become acutely aware of the lack of innovation and imagination by wine industry leaders.

Remember, this scathing indictment of the industry comes from a Millennial. I’m not nearly as dopamine addicted as most Gen Z consumers, and therefore, they may believe I’m pulling punches. They aren’t wrong, either.

After all, the solutions are somewhat intuitive if you grew up through these transformational periods, whether digitally-driven or dopamine-driven. Suppose you developed your professional identity before these trends indeed took hold. In that case, you may struggle to understand why your old way of doing business no longer resonates with emerging consumers. Since I wasn’t raised on a steady drip of dopamine-producing digital experiences, I, too, struggle and must constantly reevaluate my framing of consumers.?

That isn’t the point, though. Unlike past generations, where progress was consistent, persistent, and reasonably linear, leaders today deal with exponential changes typified by network effects and virality. We must be more prepared and willing to pursue change driven by a constant awareness of emerging needs across generational divides.

To be fair, I saw an opportunity in 2015, and I waited to capitalize on it for half a decade. At the time, I naively thought to myself, “surely the wine industry had to be already working on solutions.” I was wrong. More than eight years after Somm Says popped into my mind, the wine industry is too far behind on this front. We don’t just need new ideas, we need entirely new ways to frame our thinking about the wine consumer experience.

Hence my excoriation of modern wine executives, that they have too long buried their heads in the sand and refused to accept the change necessary to make consumers like me happy, is a knife that cuts both ways in my case. Even consumers and prominent members of the wine community have all but screamed for change. I, too, stood on the sidelines.

We can no longer afford to stay on the sidelines. I, too, can no longer afford to stay on the sidelines.

In future posts here on LinkedIn, and those on behalf of Somm Says on Wine Industry Network, we will dive further into my understanding of consumer experience value frameworks for evaluating how consumers, users, and customers can effectively interact across different constituencies of people, processes, and technologies in our industry. We are, after all, in the Platform as a Service or Marketplace as a Service economy. We may as well discuss designing solutions to address changing consumers’ needs within the paradigm of modern commercial business models and architectures.?

Please stay in touch. I can’t learn without feedback; and, dialog can be one of the best ways to give and receive feedback. If you’d like to learn more about how we’ve approached delivering value to the wine industry through a free gamification platform, please take a look at our solution to engage Millennial and Gen Z consumers: https://www.sommsays.co.