Why younger generations aren’t buying wine

While spirits and non-alcoholic beverages gain popularity, wine is losing traction with millennials and Gen Z.

The American wine industry has seen better days. For the second year in a row, wine experienced negative growth in consumption.

Although wine is still popular among those over 60 (the only growing demographic of wine consumers), it’s losing ground with millennial and Gen Z customers, who are drinking even less wine than young people did in 2007.

So, why isn’t wine appealing to younger generations and what can the industry do to woo these valuable consumers?

Wine alternatives.

While they aren’t spending money on wine, that doesn’t mean they aren’t drinking. A recent survey showed 35 percent of adults 21–29 years old drink alcohol but don’t drink wine, and are gravitating toward myriad alcoholic beverages on the market.

The ever-growing demand for liquors like tequila and whiskey has spurred countless new brands from well-known celebrities and influencers who may appeal to millennials and Gen Zers. Cocktail trends, such as the espresso martini revival, are also the vogue. In fact, U.S. spirits sales surpassed beer sales for the first time last year–partly thanks to younger consumers’ taste for cocktails.

Spirits aren’t the only wine alternatives in today’s crowded market. I’ve written about the growing sober and sober-curious movements that have given rise to new non-alcoholic beverages. From cannabis-infused cocktails to non-alcoholic beer, millennial and Gen Z consumers abstaining from wine and spirits now have a variety of innovative drinks to choose from. This is a far cry from the limited options baby boomers had in previous decades.

Courting younger generations.

Young adult consumers are well-informed and socially conscious–qualities that extend to their purchasing habits. The wine industry must speak their language.

For example, 75 percent of Gen Z and 71 percent of millennials believe the sustainability of a product is more important than the brand name. As an industry impacted by climate change, winemakers are uniquely positioned to address this issue through green initiatives and incorporate it into their brand stories and marketing campaigns.

Wine companies can also engage potential millennial and Gen Z customers through story-focused marketing and advertising touting their values, origin, philanthropy, and community involvement.

The industry must also appeal to young consumers by meeting them where they are. Wine can have a reputation for being intimidating or reserved for special occasions. Traditional wine products might not intrigue young buyers, but offerings like canned wine and sparkling varieties could introduce more approachable products to millennials and Gen Zers (similar to the way wine coolers ushered young baby boomers into wine drinking).

With wine consumption on the decline and more market competition than ever, it’s crucial that entrepreneurs in the industry attract and retain new customers. Instead of marketing the same legacy brands and products in the same ways, the industry must evolve and innovate or risk losing young generations for good.

Danilo Diazgranados is an independent investor in the global food and wine, financial services, real estate, and the hospitality sectors.