A rising tide raises all boats: The wine tourism industry gets a wake up call from Michael Mondavi

Last month I went to the first Wine Tourism Conference –  a major contrast from what I’m usually doing mid November: learning from the travel industry’s heavy hitters and the hottest startups at the PhoCusWright Conference.  For those of you that know PCW, the WTC couldn’t be more opposite. Thank goodness the wine tourism industry has banded together to help accelerate this potentially huge industry.

In the U.S., wine tourism is driven by having to sell wine in the winery  and many wineries are dependent on wine tourism for survival.  About half of their direct to consumer sales actually come from the tasting room – hence the importance of driving visitors to wine regions and into tasting rooms.

In terms of understanding how to tap into potential travelers and wine buyers online, the marketing mindset of the wine tourism industry is about where the travel industry was 10 years ago.  The industry is made up of wineries and tourism boards that have been generally slower to adapt and just not as exposed to online tech and where the travel industry as a whole is going.   But they both have big fish who are highly successful and continue to lead the industry (Mondavi, etc). The difference in the wine world is that although wineries are dependent on tasting room sales, a great proportion of them wineries are, what I’d call “marketing in a box” and are not able to see that collaboration will benefit them more than working in isolation.

Michael Mondavi

1. A rising tide raises all boats. When Michael Mondavi speaks, the industry listens.  His message came through loud and clear: “Promote Napa first, winery brands second”.  Obviously this message can be applied to wine from any region, but with over 400 wineries in Napa alone,  the expense involved in producing wine, and the reliance on tasting room sales, means wine tourism is something every winery needs to be taking seriously.

Success in this business is dependent on these small brands seeing themselves as part of a bigger picture.  So what does this big picture look like?  Every year in the U.S. wine tourism generates $3B of tourism expenditure * (hotels, tours, rental cars, etc.).  When you look at it this way, tourism actually generates more revenue for regions than the revenue wineries generate from tasting room sales.  On average people visit 2-3 wineries on a trip* and marketing regions or travel packages and compelling winery experiences can help everyone.  Looking at the effect of wine tourism in Napa alone, wineries had 8.5 million visits in 2007, generated $714 million in expenditures, 10,217 tourism related jobs, and $250M in wages.  Big business indeed.

“The world doesn’t need another winery.  Give yourself a reason to be.” – Michael Mondavi

2. Differentiation is key.  “Wineries need to find ways to differentiate themselves” – Mondavi couldn’t have spelled it out more clearly.  It’s true, finding a point of difference, something unique about the brand and presenting it as part of the visitor experience is the way to differentiate.   Wineries that understand this have successfully created dedicated spaces for wine and taken time to really understand the visitor experience and how it speaks to their brands: “Super Cave” rooms, the additional of food, the addition of art, music, all to create a more specialized visitor experiences.  More data discussed by Mondavi:

  • Napa is 4% of the CA wine industry (by volume)
  • 80% of 400 wineries in Napa are under 10,000 cases
  • 95% of wineries in Napa are family owned
  • $42B to economy nationally
  • Ripple effects are way beyond individual vineyards and wineries

3. “Winery tourism is brand building”.  People who visit wineries are brand ambassadors. People buy because of a personal connection, an experience or memory of a place they’ve been.  There was a lot of discussion about measuring the ROI of  wine tourism and the effect of the tasting room environment on the amount sold.  Even though wineries differ on the level of sophistication in their measurement, everyone seemed to understand that winery tourism needs to be part of their wine marketing strategies.

4. The potential for direct to consumer wine sales is huge.  It’s easy to forget that that wine sold direct to the consumer is only 3% of US sales.  This breaks down into 2%  sold in tasting rooms, and 1% of all US wine is shipped/sold direct.   This presents a huge opportunity for change.  In the National Economic Study from 2007, national winery D to C sales was estimated at $1.75B out of $23.8B total sales of US wine.  And, even more staggering, 88.5% US adults have never bought wine directly from the winery (online or in a tasting room). Even though a very tiny amount of people have ever been to a tasting room, the ones that do visit have a huge effect.

5. Popular regions for wine production do not necessarily mirror wine tourism.  There are 27.3 million visits to wineries across 50 states.  I was really surprised to learn that New York’s Finger Lakes gets as much as 5 million visits a year, compared to the Napa Valley, with about 8.5 million.  We also heard about the significant wine tourism focus from states such as MO, NC, OR, WA, and B.C. in Canada.

6. The demo doesn’t get much better:  A heads up for luxury marketers.  The winery visitor is about the highest quality consumer demographic you can have:  $75-100K+ HHI, empty nesters, 45+, well educated, managerial/professional, entrepreneurs, children <18 not at home, with men being termed as “trophy drinkers”.  They tend reside in wealthy suburban, ex-urban areas and also retirement resorts (ie Bend, OR, Sun Valley, Jackson Hole) & college towns (highly educated).   Top interests of winery visitors include skiing, frequent fliers, tennis, charities, foreign travelers, cultural events.

“Selling wine is about communicating the place it comes from.” Paul Wagner, BALZAC

7. The importance of creating memorable experiences.  Paul Wagner’s lively presentation hit home, and speaks to exactly what I’m working on at Lot18.  Memorable experiences are ultimately what will build brands that will last forever.  Creating opportunities to build relationships and create experiences for customers are they keys to ensuring future sales and loyalty.

8. Tapping into major events.  Napa Valley was announced as the “official wine region” of the 2013 America’s Cup – just  one example of the many bigger events that wineries can tap into.  The America’s Cup alone is expected to drive 5 million visitors into San Francisco.  Understanding how to be part of larger initiatives is better than struggling along to gain share of voice.

9.  You want people to sign up for your wine club so why don’t you tell them about it?  A staggering 75% of wineries are not presenting the wine club opportunity to tasting room visitors.  I am constantly talking to wineries who have building their wine clubs as a top priority so this came as a big of a surprise.

10. Non-wine is important in “wine country experiences”.   For travel packages and itineraries a well balanced experience is more appealing to travelers.  Interests that have come through in research studies include skiing, tennis, adventure, charities, educational, and cultural events.

Interesting facts from Ship Compliant:

  • 2% of wine is sold in tasting rooms, 1% of all US wine is shipped/sold direct, D to C is only 3% of US sales
  • 98% of US wineries produce less than 30K gallons/12,000 cases
  • 2% of US wineries produce 98% of wine (mainly grocery store wine)
  • 49%-51% of wine sold direct is sold in tasting room


  • Barbara Insel – Stonebridge Research Group
  • National Economic Impact of Wine study 2005-7
  • Nielsen Study 2007 – Winery Tourism National Survey
  • Paul Wagner from BALZAC
  • TripAdvisor
  • Michael Mondavi
  • Ship Compliant

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7 Comments on “A rising tide raises all boats: The wine tourism industry gets a wake up call from Michael Mondavi”

  1. Wine Tourism Conference December 3, 2011 at 5:11 pm #

    Great recap of all the insight from the conference, Mindy! Thanks for the write-up of what you got out of the Wine Tourism Conference. Hope you can join us again next year.

    • Mindy Joyce December 3, 2011 at 6:30 pm #

      Thanks Elle! Really enjoyed the conference. It was great to meet you!

  2. tannick December 5, 2011 at 1:42 pm #

    Nice recap for those that missed the conference. Love to connect and chat about the great experiences you are developing for Lot 18. Feel free to PM me when you get a chance.
    Rich Janshen

    • Mindy Joyce March 4, 2012 at 2:58 pm #

      Hi Rich, absolutely. Thanks so much for reading my blog. Feel free to email me directly at mindy@lot18.com. Cheers, Mindy

  3. Robin December 9, 2011 at 9:26 am #

    Thanks! Great post you have written on “A rising tide raises all boats: The wine tourism industry gets a wake up call from Michael Mondavi”.Really I can say that your post is very informative, I’ll come across your blog again when you will update it with new.
    Boats in India

  4. Vineyard Adventures (@robbin_g) December 30, 2011 at 12:42 pm #

    Will you be joining us in Perugia for the International conference?

    • Mindy Joyce March 4, 2012 at 2:56 pm #

      Hi Robbin – No unfortunately I missed it. How was the conference?

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