What is the Wine Industry’s missing when it comes to Gen Z?

Last Monday, I came across an article by Areni Global discussing how the wine industry is missing opportunities to connect with younger consumers, and it’s been stuck in my mind all week. We know wine’s charm for previous generations—romanticized vineyard tours, the prestige of origin labels, and a glass of red paired with steak. But to Gen Z, wine is often seen as old-fashioned, or worse, the “cigarette” of 2024, according to The San Francisco Chronicle.

Gen Z, defined as those born between 1996 and 2012, has rewritten the rules of what it means to drink socially. As the State of the U.S. Wine Industry report reveals, this generation is turning away from traditional alcohol consumption altogether, favouring hard seltzers, non-alcoholic alternatives, and even cannabis. Wine, it seems, just doesn’t fit into their health-conscious, sober-curious lifestyle.

To get us all in the context of the state of the wine industry, volume sales for wine in the U.S. declined by 3% last year—the third consecutive year of decline—and still, wine volumes globally have fallen 4% in the first half of 2023. There’s talk of a generational “gap” in consumer numbers, especially in traditional markets like the U.S. and U.K., where only 26% of regular wine drinkers are under 39. By contrast, Baby Boomers (aged 55+) still hold nearly half of the market.

But before we get too sensationalist, there’s something crucial to understand: this generation isn’t anti-alcohol—they’re simply looking for new experiences, more thoughtful choices, and meaningful connections. Gen Z isn’t against wine; they’re just waiting for wine to meet them where they are. And that’s where other beverage industries are outpacing us.

From social media trends like Brat Summer to health-forward functional beverages, brands in other categories are not just surviving but thriving by tapping into Gen Z’s values: health, sustainability, and authenticity. This opens the question: Why is the wine industry still leaning on old tropes when innovation and creativity are the keys to engaging the next generation?

The Global Context: Why Gen Z Is Drinking Less Wine

Gen Z’s relationship with alcohol has been shaped by unique circumstances. The eldest members turned 21 in the middle of a pandemic, where social distancing replaced the hard partying that characterized previous coming-of-age milestones. This, coupled with the rise of sober-curious movements and a sharp focus on health and wellness, has led to a generational shift.

According to Fast Company, many Gen Z drinkers are opting for hard seltzers, low-ABV beverages, and non-alcoholic alternatives over wine. And it’s not just what they’re drinking, but how they’re discovering it. Research commissioned by Wine Paris & Vinexpo found that only 13% of Gen Z and millennials rely on traditional wine publications, while 30% turn to social media and 40% to recommendations from friends and family.

They’re more open to discovering new products but less attached to the prestige of traditional wine regions or labels. Sustainability is also a key factor, with two-thirds of young drinkers citing environmental concerns as critical in their purchasing decisions. (IWSR) These shifting values make it clear that the wine industry’s current approach may no longer resonate with this younger demographic.

What Gen Z Values and How Brands Are Captivating Them

Gen Z is fundamentally different from previous generations in their approach to consumption. They value:

• Health and Wellness: Lower alcohol content and healthier ingredients are key drivers.
• Sustainability: Brands that show genuine concern for the environment gain their loyalty.
• Authenticity: They see through performative marketing and demand real, relatable connections.
• Experiential Drinking: It’s not just about the drink; it’s about the story and experience behind it.

Brands from other industries are capitalizing on these trends and values. Here are five examples of beverage brands successfully connecting with Gen Z, followed by how the wine industry can apply similar strategies.

Olipop and the Nostalgia of Brat Summer

• Success Story: Olipop, a sparkling tonic brand, captured the essence of Brat Summer by promoting retro-inspired flavors that tap into a sense of nostalgia while staying health-conscious. By encouraging user-generated content (UGC) and leaning into nostalgic aesthetics, Olipop engaged young consumers in a playful, relatable way.
• Wine Comparison: 19 Crimes attempted a similar strategy by pairing AR technology with a rebellious narrative. However, while 19 Crimes is often cited as the go-to innovation example, the wine industry seems bored with its formula. Instead of resting on past success, it’s time for wine brands to experiment with new narratives—imagine an interactive wine experience that taps into nostalgia or cultural movements beyond historical figures.

PepsiCo’s Bubly and Barbiecore

• Success Story: Bubly leveraged the Barbiecore trend with its bright pink packaging and playful marketing that aligned with the fun, ultra-feminine aesthetic. By tying their product to a visual trend, they kept their brand relevant on platforms like TikTok.
• Wine Comparison: Yes Way Rosé did something similar with its embrace of the Millennial Pink trend, positioning itself as the go-to rosé for light-hearted, Instagram-worthy moments. However, for other wine brands, the opportunity lies in going deeper than aesthetics—creating visual campaigns that are both trendy and rooted in sustainable practices would hit the mark for this eco-conscious generation.

Recess and Functional Beverages

• Success Story: Recess, a sparkling water infused with hemp and adaptogens, became popular among Gen Z for its focus on relaxation and mental health. This positioned it as a functional beverage, perfect for a generation prioritizing wellness.
• Wine Comparison: While the wine industry is traditionally high in alcohol content, there’s an opening for lower-ABV wines or even alcohol-free alternatives. Brands like Thomson & Scott are already entering this space with their alcohol-free sparkling wine, Noughty, but there’s still untapped potential in functional wines, perhaps infused with natural relaxants or botanicals.

GT’s Kombucha and the Cottagecore Movement

• Success Story: GT’s Kombucha, with its natural fermentation process and artisanal roots, leaned into the Cottagecore trend that celebrates slow living and connection to nature. The brand’s packaging and ethos perfectly align with this aesthetic, which is popular among young, eco-conscious consumers.
• Wine Comparison: Brands like Ava Grace Vineyards have taken similar steps, aligning their messaging with the natural beauty and slow-living vibes of Cottagecore. The next step for wine is to deepen its commitment to sustainability, with fully eco-friendly packaging and authentic storytelling that invites young consumers into the winemaking process itself.

Red Bull and Hot Girl Walks

• Success Story: Red Bull linked itself to the Hot Girl Walk trend, where young women promote confidence and self-care during their walks, positioning their product as the perfect companion for this wellness activity.
• Wine Comparison: Wine has historically been tied to indulgence, but how can it embrace wellness? A wine brand could sponsor self-care events or partner with fitness influencers who embrace balance, positioning wine as a mindful indulgence, rather than a guilty pleasure. The opportunity to connect wine with wellness experiences is ripe for innovation.

Conclusion: Thinking Outside the Box

If there’s one lesson to be learned from the success of these beverage brands, it’s that Gen Z craves more than just a product—they seek an experience, a story, and a sense of purpose. While the wine industry may be steeped in tradition, that doesn’t mean it has to be stuck in the past.

Innovation has been a buzzword in the wine world for some time, but the pressure is now real. The clock is ticking for the industry to adapt. By embracing trends that align with Gen Z’s values—whether through sustainability, lower alcohol options, or interactive social media campaigns—wine brands have the opportunity to not just survive but thrive in the hands of this new generation of consumers.

The question is, are we ready to think outside the box?