Ep. 487 wine2wine 2020 Session Recording | Finding Silver Linings

Italian wine podcast. Chinchin with Italian wine people. Italian wine podcast as wine to wine twenty twenty media partner is proud to present a series of sessions chosen to highlight key themes and ideas and recorded during the two day event held on November twenty third and twenty fourth twenty twenty. One to wine twenty twenty represented the first ever fully digital edition of the business to business forum. Visit wine to wine dot net and make sure to attend future editions of wine to wine business forum. Hello. As the granddaughter and great niece of our winery's co founders, earnest and Julia Gallo, Stephanie Gallo possesses a deep rooted passion for wine. She grew up in the wine industry and reflective of her grandfather, Ernest, legendary marketing prowess, Stephanie leads our company's global marketing initiatives. She is one of fifteen Gallove family members currently working in the family business. Today, as our chief marketing officer, Stephanie carries her family's enduring vision to make wine a part of everyday life. She is passionate about growing the careers and experience of others and cultivating a progressive and diverse work environment. Stephanie plays an important role in the winery's many employee resource groups, supporting their efforts to drive professional advancement, networking, and cultural enrichment. But her success is not solely measured by our company's success. Stephanie is a wife, a mother of two, and a strong community supporter. She is a friend, a mentor, and an inspiration to so many women within our industry. I am now honored to introduce my friend, and mentor, Stephanie Gallow. Christina, thanks so much for that wonderful introduction. And you know that the feeling is mutual. Thank you, everyone, for, for having me here today. I am so honored first and foremost, I would like to thank Vin Italy and wine to wine, mister Montovani and Steve Kim. They certainly have been unprecedented times not only the United States but around the world. Each of us have faced many challenges both personally and professionally. While we could choose to dwell on the negatives at Gallo, we like to look at things with a glass half full mentality. This means choosing optimism and choosing to learn as we go. Our guiding principles have always been our company values of integrity, respect, humility, innovation, commitment, and teamwork. These values are at the foundation for everything that we do. I'm also often inspired by the story of our founders and how our company came to exist. I would just like to take a few minutes of your time to share with you the founding of our company because I think it'll give you a great perspective as to why we have a glass half full mentality. It was post prohibition, post great depression, nineteen thirty three, a time that many would would consider not ideal to start a business. My grandfather, Ernest, and great uncle, Julia, however, sought differently. They viewed it as an opportunity. It was truly about the American dream. A belief that anyone can attain their own version of success through sacrifice, risk taking, and hard work. Ernest and Julia at the ages of twenty four and twenty three had very little money and actually took a loan from my great grandmother. They bought equipment on credit and graves on consignment. An agreement where they paid nothing upfront and a smaller amount from wine profits. It's from these humble beginnings that are families winery, and the company know today as Gallow was born. Their story is one of perseverance and choosing optimism. In fact, in many ways, the company's existence is a silver lining from a different era. In the nineteen sixties, Ernest and Julia established the Gallow Creed, a document that was way ahead of its time. The creed outlined the expectations they had for all aspects of the business. What has stuck with me and remains even more true today is their envision to constantly win new friends for wine. It's from these history lessons that our company chose to approach the pandemic rooted in our values and with a glass half full mentality. It's been a journey of learning, and I'm excited to share with you some key silver linings that have emerged in the wine industry during the pandemic. Like many of you, we've pivoted across our entire organization practically overnight, and I quickly realized it was more important than ever to lead with an enormous amount of flexibility, empathy, and compassion. We're a family owned company that cares deeply about one another, are industry in our communities, and this framework is how we've approached our work and often our personal lives during COVID, which brings me to our first silver lining. Prior to COVID, the wine category overall was seen less engagement as baby boomers began limiting their consumption. The Silicon Valley Bank Research at the end of last year, on the state of the US wine industry revealed that retiring wine loving baby boomers were being replaced by more frugal spirits loving millennials and now gen zers who consume less alcohol than prior generations. Younger consumers are less interested in wine and consuming across all categories of alcohol beverage. What we have noticed and data has reinforced this is an increase in consumers purchasing wine in retail since the onset of COVID. In fact, it's around over four million new consumers have entered into the category through retail since COVID has begun. This is one of the most impactful silver linings for our industry because new consumers are embracing why during this time and engaging with the category. It is important for our industry to innovate how we engage these new consumers in ways that resonate with them. We must be reflective of what's going on society today and ensure we reflect everyone. Today's world is a more diverse landscape than ever before, and it's imperative that our industry reflects the world that we live in. Consumption patterns have also shifted from consuming in the on premise environment to consuming at home. We have an advantage because wine brings people together and with home becoming the epicenter of activity for most households, this means cooking more and spending more time together around the dinner table. We continue to see the rise of virtual happy hours, wine tastings, and in home experiences, as ways our consumers are connecting and engaging with our brands and one another. An example of this was in August. Orin Swift Weymaker Dave Finney partnered with DJ D NICE, a pioneer in the hip hop industry who is hosting club quarantine, an impromptu at home live DJ set. The seventy five minute session had more than two thousand new consumers tuning in to learn about Orange Swift's latest release of Pappy Young, along with a fun Q and A on wine, music, family, and life. It's about reaching these new consumers where they are and engaging with diverse audiences in unique and unexpected ways that feel timely and relevant. The silver lining in this example is not only the new consumers reached but also the fact that more than two hundred consumers purchased Pappy on online and more than three hundred consumers signed up for the Orange Swift mailing list. Interest and online talks and classes are continuing to grow, as people use newfound time at home to increase their expertise and knowledge around food and wine, but there's still more work to do. We must make sure that we meet the unique needs of these new consumers entering the wine category whether it's through a diverse range of wine styles or by offering a wide range of formats and sizes. This means to continue to innovate and delivering products that meet consumer needs. Consumers often simply want to enjoy a glass of wine And the seven fifty package can sometimes be a barrier, therefore, single serve packaging such as three liter box cans, three seven fives, and ready to drink formats are incredibly important as we look to engage with new consumers, providing more options in smaller formats. We also know that fifty three percent of online alcohol buyers are first time online alcohol buyers. If we don't deliver what they're looking for, these new consumers will not continue to engage with the category. So we must strive to meet their needs, both in products we offer, but also how we are communicating. We must communicate differently by leveraging multiple channels, including social media, paid average advertising, public relations, or a wide range of virtual and experiential events. Traditional capabilities in storytelling and communications are increasingly important. Consumers still want experiences, but those have shifted to being at home or in smaller groups. We need to ensure we stay relevant in the at home environment. This leads me to our second silver lining, which is new ways of working and the use of technology. We believe at Gallo that leaders rise in challenging times, and I've learned to never underestimate the resolve of employees you've chosen, they're willing to adapt, help, and learn new ways of working, as well as collaborate in new and different ways. This has been truly inspiring. And for us, I believe that our teams are closer than ever. Every Monday morning, I hold a CMO live video call with the entire Gallo organization. I share what is happening in our business, best practices and learnings, and if time is so much certain uncertainty, this weekly virtual check-in, has become a very powerful tool for our organization. It has allowed us to communicate important information and to share and to learn from each other in a way that we did not do pre COVID. It allows me to set the tone for the week and reinforce our mantra of operating with flexibility, empathy, and compassion. The key is about finding new and different ways to connect that allows for personalization and togetherness while celebrating the work that we're all a part of By leaning in to virtual activities and experiences, we've also been able to better connect with our consumers, customers, and fellow team members around the world without the need for extensive and lengthy travel. The transition of virtual has truly allowed us to take advantage of global opportunities, whether it's conducting media tours with our Italian partners, having our winemakers lead tastings in Sweden over virtual platforms, as well as planning winemaker dinners with our customers in Asia, We've truly been able to support the needs of our global teams through the use of technology. During this time, we've also seen the wine world embrace virtual experiences, including the likes of Aspen Food and wine classic, pivoting to Aspen food and wine at home, some con virtual summit, and over the course of wine to wine, the wine spectator holding opera wine virtually. Virtual education and master class typed content are finding success with retailers, trade, and consumers. While in person events can never be replaced, virtual experiences afford consumers the ability to engage in interactive and meaningful ways with wine. An example of leveraging interactive technology in a meaningful way is our barefoot brands work with the black eyed peas. With concerts at a standstill and our brands looking to engage with consumers in store and at home, we embarked on an augmented reality app. Consumer scan the foot to bring barefoot packaging to life, unlocking exclusive black eyed peas content. We saw high engagement from app users and generated over thirty seven million consumer impressions across all social channels. Virtual also allows us to reach more people. For example, with Lamarca Presecco in the US, we launched a program called Every Girls in twenty nineteen, an in person conference designed to help women focus on their passions and reinvigorate their careers reaching two hundred people in two cities. Last month, we held the event virtually and reached over a thousand amazing women by offering the conference online. And while I wish we're all together in Italy right now, it's truly incredible that we're still able to connect in this virtual format with such a wide range of speakers and topics from across the globe, the global wine community, forcing the industry to adapt change and evolve. This use of technology is here to stay, and these new ways of working will be something we all continue well beyond COVID. We all see read and hear the devastating stories about many of our restaurant partners and the impact COVID has had on their businesses. Businesses that were thriving prior to the pandemic This has been hard to watch as many restaurants have closed their doors, leaving many around the world unemployed, but there is a silver lining. We've been fortunate the restaurants are now able to sell wine for takeout and off premise consumption in the US. Something that previously was not allowed. Today, one in five takeout orders or twenty percent now includes alcohol. This presents a tremendous opportunity to optimize food pairings and deliver creative offerings for takeout such as spritz kits and other pairing suggestions. Insuring we are supplying our customers with the right wines while evaluating what resonates most for consumers is key. We need to deliver what consumers are looking for, especially given that restaurants are carrying less inventory. One is included in thirty two percent of alcohol orders for delivery takeout from on premise establishments versus thirty six percent for beer and twenty eight percent for spirits. Seventeen percent of US drinking adults ordered alcohol this way for the first time. If this trial becomes a habit, it could be a sizable new channel for the future. Therefore, continuing to innovate in this space provides great opportunity to continue engaging with new consumers. We see this trend continuing in the future as the on premise channel continues to pivot. In addition to this new takeout channel, the very nature of how people are purchasing wine is a silver lining. This leads me to the growth of e commerce. Online grocery sales, direct to consumer and e commerce channels continue to see tremendous growth. In fact, online grocery sales have grown five times in the last year, and seventy five percent of online grocery shoppers plan to continue shopping online for groceries in the future. Convenience is key. Overall, online alcohol sales have seen over two hundred percent growth in the past six months. Additionally, shoppers who buy alcohol online spend almost three times more than the average alcohol buyer per year. These consumers are extremely valuable to retain inevitably, this will continue to be an important channel to lean in on as online represents four percent of total alcohol sales year to date. In fact, eighty eight percent of new online shoppers will continue buying wine online after the pandemic with over a third expecting to shop online for most of their wine. This is a huge increase compared to the twenty four percent shopping for wine online before COVID. The growth in e commerce in addition to new innovations that help support our on premise customers will continue to be a critical component and channels for growth in the future. Consumer behavior has changed so rapidly in e commerce due to COVID. We've had to quickly adapt and accelerate our efforts in this area to keep up with consumer demand. For our industry, this is truly a silver lining. We should continue to embrace and move full speed ahead in growing our capabilities to meet the needs of online shoppers in the e commerce channel. I know that Ian Griffith will also speak to the growing importance of e commerce tomorrow. LOEs once said, When we give ourselves permission to fail, we, at the same time, give ourselves permission to excel. Another silver lining of COVID is that it has given us permission to try new things with the freedom to fail because we've had a pivot quickly We are freed from the expectations of understanding exactly what our results would or should be. We took the approach of failing fearlessly. We tried new things. We learned. We then adjusted for the next attempt. Most importantly, we look through the lens of continuous improvement and we have a saying at Gallow. It's progress over perfection. This is when the best ideas are born. As an example, we, developed what we call our chef's supper series. Never before had our executive chef at Lewis m Martini attempted to broadcast a cooking demonstration live from the winery. When guests weren't able to visit the winery due to the restrictions, we created a separate series to bring the culinary expertise of chef Jeffrey to our consumers. We knew consumers were looking for new recipes to make at home, and this provided a great opportunity to leverage technology while providing meaningful cooking demonstrations to our consumers. Finding new ways to connect while not limiting creative freedom and having permission to not get it right the first time paid off tremendously. And we've evolved these cooking demos ever since, but maybe the biggest silver lining of all has been families spending more time together to celebrate and create new traditions. At Gallo, our purpose is to serve enjoyment in moments that matter, which means making wine accessible for all and being there for all moments, not just traditional celebratory moments. As an industry, we have an opportunity to make wine a part of new traditions and new occasions. COVID has allowed us to connect in new and meaningful ways with our families and friends, as well as trade and consumers that we never envision prior to twenty twenty. We're honored that consumers are choosing to make wine a part of these traditions. While there are likely many more silver linings in addition to the five I shared with you today, we have a tremendous opportunity to continue to grow our industry, which brings me back to the story of our founders. This is a story of perseverance and optimism. We are a resilient industry. I'm continuously reminded that we are all in this together. The pandemic has been a great equalizer and has forced us as an industry to come together as a company as an industry and in the world. My father said a few years ago only by innovating can we improve to meet the opportunities and challenges of a fast paced changing world? I'm not sure we could have predicted how fast changing it would be in twenty twenty. And while there are many challenges, there are endless opportunities. So I challenge each and each of you to have a glass, have full mindset, and to continue to seek out new and different ways to welcome new friends to wine. My grandfather artist always said the best is yet to come. I firmly believe this is still true today. I'm inspired and hopeful for the future, and I hope you are too. I look forward to seeing the continued evolution of our industry and what we all can do working together. All the best to each of you, all the best to the bright future ahead, a future filled with an abundance of silver linings. Thank you so much. Thank you, Stephanie. What a wonderful, presentation and speech today. I don't see any questions within the question box. So I'm going to say, wonderful, segment today, and I hope you have a good rest of your day. So thank you everybody for joining us, today. Thank you. Listen to the Italian wine podcast wherever you get your podcasts. We're on SoundCloud, Apple Podcasts, Himalaya FM, and more. 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