Jul 01, 2021
Over the last year, restaurants, tasting rooms and wine bars have faced the unprecedented challenge of trying to stay afloat in the midst of the COVID-19 pandemic and severe lockdown measures that followed. While most have done everything they can to embrace the online space, the fact remains that these businesses still need to be profitable in the realms of brick and mortar. Sadly, the on-trade side of the South African wine industry experienced a fair amount of decimation. Among the many victims of COVID-19 pandemic closures, Belthazar Restaurant and Wine Bar and Restaurant Mosaic are two of the most notable.
Despite this, the past 15 months have presented hospitality and on-trade with the opportunity to reinvent themselves and adapt to the ‘new normal’ by taking their cues from changes in consumer behaviour. Although it has not been possible for everyone to embrace this, those who have, have been rewarded with renewed interest in their brand and growing customer loyalty.
In an effort to gain some practical advice on how to adjust to pandemic-inspired changes in consumer behaviour, we gathered a panel of experts to share their first-hand insights for the latest edition of our Vinimark Webinar series.
Chaired by wine journalist and creator of HanDrinksSolo, Jono Le Feuvre, the panel included Ross Baker, Managing Director of Wild Peacock Products; Miguel Chan, Group Sommelier of Tsogo Sun; Robert Joseph, wine critic-turned producer, industry-analyst and consultant; Paula Mackenzie, Vinimark Gauteng On-con Manager; and Matt Manning, Chef and Restaurateur.
Here are five practical tips to take away from the conversation:
As much as many of us had hoped that this would all be over soon, the truth is our world is forever changed by the COVID-19 pandemic and we need to roll with the punches.
Our first speaker, Paula Mackenzie, pointed out some of the key elements she’s observed that separate successful businesses from those who are failing: “Businesses that have been happy to adjust, use their outdoor spaces more effectively, stick with protocol and make sure that their service, food, prices and wine list were at the same standard as pre-COVID, have generally managed to come through the past few months successfully.” She added that among these things, maintaining pre-COVID standards has been of the utmost importance.
As lockdown measures have eased, consumers have shown a willingness to spend more on eating out than they did before. Thus, keeping standards high and offering top quality food and wine is imperative. Echoing this, Miguel Chan noted that they’ve seen an increase in the sale of luxury champagnes, cognac and more expensive wines. “What we’ve seen is an eagerness to spend,” he said. “There definitely has been a migration to higher-priced wines.”
The consumer’s willingness to embrace premium wines has come as a pleasant surprise to Chan and his team. “When we reopened in June last year, the lower-priced items were first to move and the next question was: Do we buy new stock with a similar price or do we simply replace them with a higher-priced wine and see what the consumer reaction will be,” he explained. “We went for option B, removing the lower-priced wines and replacing them with higher-priced counterparts. Surprisingly, there hasn’t been any resistance.”
This, in part, has also played a role in Tsogo Sun’s decision to reduce their menu offering – both in terms of food and their wine lists. “We’ve tried to be creative and adjust to what the consumer wants,” said Chan. “We used to have 250 wines on our menus, but this is gone and it will never come back. Currently, we are offering 80 wines on the list.” This minimalistic approach is quickly becoming a trend at restaurants everywhere.
While it could complicate the process for wine producers or brands to get their wines listed, it also presents the opportunity to identify and work closely with restaurants that are more aligned with your brand’s ethos.
Mackenzie advises taking a focused approach – both to the restaurants you choose to work with and the wines you offer them. “Look at the menu, understand what they’re going with and focus on what you can offer to fit in with that. Be specific,” she said.
For small wine producers or brands who might be intimidated by their bigger opponents, Robert Joseph advised building a relationship with one or two specific restaurants to start off with, instead of targeting a whole range.
Even though this may mean getting fewer wines listed in one go, taking this approach offers a better opportunity for exponential growth in sales.
The tendency towards reducing wine lists offers wine producers and brands an excellent opportunity to take a step back and re-evaluate the way they present themselves to restaurateurs and sommeliers, as well as to consumers.
Instead of seeing it as a drawback, it could be a gateway to refining and redefining your brand, identifying your strengths and focusing attention on what makes you unique.
Closely related to the re-evaluation of your brand, is investing in your customer relationship management. The way you choose to communicate who you are and what it is you do is more important than ever before.
Chan highlighted the power of social media and actively engaging with consumers across various online platforms. “If you put effort into your social media and engage with your followers, there will be interest from the consumer and it will be easier for sommeliers to sell your wines to them,” he explained.
As you become more active on social platforms, familiarity and rapport with consumers will grow, making you top-of-mind next time they sit down to order a bottle of wine to enjoy at a restaurant.
With consumers not being able to visit wineries and tasting rooms as frequently as they might have before, Joseph pointed out that social media offers you the opportunity to bring your wine experience right into the palm of the consumer's hand. “[South Africa’s] wine tourism offering is now extraordinarily good and must be communicated,” he said. “I want to be sitting in London, Berlin or New York and see what I can expect on my next trip to South Africa.”
Although he isn’t a wine producer, Matt Manning can attest to the power of social media and communicating with consumers via regular newsletters.
Despite obvious risks, when a dream property opened up in Bree Street mid-pandemic last year, Manning jumped at the opportunity to pick up the rent and open Culture Wine Bar. Apart from Culture, he is also the owner and founder of Grub & Vine, as well as The Chef’s Studio. “We’ve been quite active in communicating on social media, building an engaged online community and by sending out regular newsletters, which is important for establishing a new brand,” he said.
Although opening a brand new wine bar might have seemed crazy to many, Manning has reaped the rewards of his bold leap. “Culture has diversified my business and given us the opportunity to expand our consumer offering,” he said.
To keep things interesting, Manning and his team have also introduced a number of weekly experiences consumers can take part in and enjoy, including both free and paid-for wine tastings and live music. “We’re keeping things quite simple,” he said “and focusing on quality over quantity for both the food menu and the wine list.”
Apart from the wine bar, Culture is also home to the Wine Library, a co-working space which offers a tiered membership programme to those who work in the wine industry.
Despite the fact that South Africa’s hospitality and wine industries have experienced a severe knock due to the pandemic, the overarching message from the panellists seemed to be that there is much to be optimistic about.
As Ross Baker pointed out: “With the world being vaccinated before our eyes, a perfect storm is coming. We saw a great peak season in the Cape over December 2020, purely supported by local tourism and now bigger hotels are starting to open up in anticipation of overseas travellers coming from about October onwards.”
The call is now to all in the wine and hospitality industry to take the cue, be creative and prepare an experience of a lifetime for our loyal customers and international guests on their return.