Last week I met a friend for a glass of wine, he brought a bottle of #TBT Rose (pictured below). The label featured artistic, square photos like those that you'd see on an Instagram influencer's feed. As a Northern Californian, everything about me screamed "LA" - which happens to be where my friend is from.
This got me thinking - if most people are truly buying wine for the branding on the bottle as opposed to what's inside, is there an opportunity to mass produce one wine but localize the label? We've seen from the exhibits in our cases that the economics are best on very high end wines and on mass-produced low end wines. If a wine brand were to create one wine (or maybe one white, one red, and one rose) for production across the country, surely it would be able to take advantage of economies of scale. Rather than marketing the wine under one label, the company could localize and customize the labels (but not the wine). They could create these "LA instagram type" labels for that region as well as one more localized for the San Francisco consumer, the sophisticated New Yorker, or the proud Boston sports fan.
I think that generally, there is a lower bound on the volume needed to justify the creation of a type of wine, currently identified by it's label. By allowing multiple wine names/labels to share the same wine, you could raise that lower bound for each individual wine name/label. This "hyper-targeting" of a wine (or at least increased targeting) could perhaps allow you to raise the price per bottle (the assumption here is that someone's WTP would increase the more they identify with the item they're purchasing). Perhaps this could be a way to make an increased margin on the $10-15 per bottle range!
Jane, thanks for sharing and what a fascinating topic! The idea of having different labels for the same wine reminds me of the personalized marketing used in retail sector: for instance for the same sweater, one target group of customers would receive one version of the marketing campaign vs another group sees a different version.
ReplyDeleteI think an interesting follow-up question on the different labels for the same one idea is how are you going to segment wine customers? Would you recommend design different labels based on customer geography? or demographics? or other attitudinal or behavior factors? :-)
This is a great idea, Jane! One (much more crude) example I've seen is at Cline Cellars in Sonoma - I saw in their tasting room a Giants-branded MLB wine that I believe is the same as their normal Pinot Gris with a different label (http://clinecellars.com/cline-life/wine-by-design-adds-new-wine-to-sf-giants-club-series-collection). I think it also gives them a new form of distribution (via the Giants' website) that they otherwise wouldn't have access to, in addition to being able to market to a different customer segment. I really like your idea of customizing to different geographies' preferences, rather than just slapping a logo on the bottle.
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