The tasting room at Ashes & Diamonds, a 2-year-old winery just off Highway 29, does not feel very Napa.
For one, there is the decor, all midcentury modern, with brightly colored womb chairs and hip wood paneling. Then there is the music, a smorgasbord of faded funk hits and Brazilian covers of David Bowie, cooing out of the (excellent) sound system. But here’s the true shocker: On a recent Tuesday afternoon, the room was filled with people under the age of 40.
Napa Valley, capital of wine tourism in California, pinnacle of New World luxury hooch, has a Millennial problem. The kids might be all grown up — by the end of this year, the youngest Millennial will be 23, using the Pew Research Center definition of the generation — but they aren’t drinking wine the way their parents did, and the arena to see the shift up close is the Napa tasting room.
Today, Millennials make up just 17% of the fine wine market, according to the Silicon Valley Bank’s influential annual wine industry report, and that number has stubbornly refused to budge for years. Tasting room visits in Napa have trended down for the last five years, even as regional tourism has boomed, and the average price for a tasting has skyrocketed to $40 per person.
While young wine drinkers may splurge on the occasional $50 bottle, $8 to $12 remains their sweet spot, says Rob McMillan, author of the bank’s 2019 report. “The issue of greatest concern for the wine business today is the millennial generation’s lack of participation in the premium wine category,” the report warns.
“This generation is living in a post-bust world. They have an indulgence gap,” McMillan says. “They’re in an apartment, where it’s hard to have a cellar — or even a wine fridge.”
It’s easy to blame the Millennials’ disinterest in Napa solely on economics.
This is the economically stunted generation — the one that delayed marriage and put off car purchases and home ownership after coming of age during the 2008 recession. Conspicuous consumption means something different for this generation. But the rhetorical murder charge we see splashed across news headlines — Millennials are killing [fill in the blank] — isn’t so cut-and-dried in Wine Country.
“Millennials haven’t killed anything,” McMillan says. “They’re just being rational consumers.”
Unlike Baby Boomers in their heyday, Millennial consumers today have access to a broader selection of fine libations. In the 1980s, Napa competed with high-end wine from France or Sonoma; today it competes with craft IPAs, mezcal, legal pot and, for some reason, hard seltzer.
Wine, especially the expensive variety endemic to Napa, has not done a good job battling for Millennials’ “throat share,” observers argue. The tasting room — the expected entree into local wine for consumers, the place wineries make their big bucks by signing club members — doesn’t sing to Millennials the way it did to their parents.
“Kids really don’t want to drive their father’s car to high school,” McMillan says from experience (his daughter is a Millennial). Millennials, surveys show, want something unique, something with an authentic story, something, yes, Instagrammable. “They want something cooler from wine, too.”
To attract and retain drinkers, wineries are now dabbling in something Millennials consistently report loving: experiences.
At Ashes & Diamonds, one of a handful of Napa and Sonoma County wineries competitors are looking to for inspiration when it comes to “the Millennial problem,” the tasting experience is something very different. Gone are the uncomfortable stools and wine cask furniture. Tastings aren’t served belly-up to the bar, the way Boomers learned to sample and spit when Robert Mondavi was king.
Instead, four 30-somethings at Ashes & Diamonds lounge on couches while a group of young women in large hats crowd around their own long dining table. “People come to Napa expecting a particular style,” Emily Fontaine, hospitality sales lead at the winery, 27, says diplomatically. And this is not it.
The wines are mostly made with minimal intervention, more subtle and Old World than boldly Californian. Tastings are $40 or $50. If you’re feeling peckish, for $45 more, the winery’s chef will course out a feast, with burrata and tomatoes, house-made potato chips paired with a creme fraiche dip dolloped with caviar and roe, pickled vegetables, duck confit and more – a far cry from the old crackers and refrigerator-cold cheese plates of decades past.
“Whether they’re a Millennial or Boomer, when a consumer is spending $500 for a hotel room, $400 for a flight — boy, we gotta over-deliver,” Ashes & Diamonds owner Kashy Khaledi, 42, says. “It’s all about lightness and positivity and wellness. Does that attract young people or Millennials? It has.”
If a trip to Ashes & Diamonds feels a little like walking into a midcentury cocktail party in the Hollywood hills, the Prisoner Wine Co.’s new tasting room, in St. Helena, veers toward what you could call hipster Game of Thrones.
Chains hang from the ceiling; the furniture is gunmetal and leather; a vibrating skeleton serves as art. It is undeniably new and exciting for the valley, a palate cleanser after the parade of fake Italianate manors and chandeliers made of oak barrels. Its opening last year prompted Wine Enthusiast to declare it a harbinger of the death of the “traditional” tasting room.
The crowd at the Prisoner — a cult brand known for its steampunk vibe and big red blends that was purchased by wine industry powerhouse Constellation for $285 million in 2016 — runs the gamut from college age to Boomer. The tasting is distinctly feet-up.
“We try to create an environment where people can relax with their friends,” says Logan Michaud, 33, the winery’s senior wine educator. “It’s a whole new thing for Napa — sitting, reservations. It turns out a lot of people want this experience.”
The success of these higher-end wineries with younger consumers is no accident, says McMillan, of the Silicon Valley Bank.
“We’re behind the times in the way we present our product to the consumer,” he says. “That’s why Ashes and Diamonds and Prisoner are on top. It wasn’t all about price, it can be about marketing to a new generation, too.”
Some observers worry, however, that a “tasting room war” of one-upmanship is fermenting.
“The arms race is unsustainable,” says Paul Mabray, an early leader in wine e-commerce and Napa resident who co-wrote the Silicon Valley Bank report. Even though tasting rooms are the key entry points to most wineries, spending millions of dollars on renovations is not a long-term solution, Mabray argues. “We’re going to have to get smarter.”
Wine, certainly for Californians and even for America at large, has been synonymous with Napa Valley for 50 years.
But Millennials are a worldly generation, just as interested in exploring the offerings of Greece or Argentina, says Amber Lebeau, an industry vet and (Millennial) wine blogger. Her peers are happy to travel to Washington or Oregon or Texas for a wine country weekend. “Napa doesn’t have the monopoly anymore,” she says.
More troublingly for Napa, Lebeau contends, is that Millennials aren’t just interested in buying the wines Napa has relied on for 30 years. “They need other varietals. They can’t put all their eggs in Cab and Chardonnay like they did for Boomers,” she says. “I think Napa can survive the Millennials, but they need to change.”
At hip restaurants like Verjus and the Morris in San Francisco, Lebeau notes, the scruffy young somms are pouring skin contact wines from Slovenia and spontaneously fermented rose from (gasp) Contra Costa County — not classic Napa Cabernet.
At Outland, an effortlessly cool downtown Napa collaboration between local wineries Poe, Farella and Forlorn Hope that opened in 2016, visitors can try Semillons and Picpouls in the light-wood- and air-filled urban tasting room. It is one of the very few spots in the region offering such diversions, says General Manager Alex Leonardini.
“It was rocky to start, of course. People would come by and they’d be like, where are the Cabernets?” Leonardini laughs. “We still get that — people are like, ‘We’d like to try all your Cabs.’ And I say, ‘We have one of those, I can definitely pour you a splash. But if you want to try skin-fermented Pinot Grigio, I can do that too!’”
And let’s be honest: Tasting Cabs all day can be exhausting. The wines, beautiful as they may be, tend to be high alcohol, and few things dry out the mouth like knocking down multiple Cab tastings. The “natural” wines in vogue today — as well as rosé, a habit Millennials still haven’t dropped — are usually lower in alcohol and lighter than Napa’s biggest sellers.
Still, the region’s dedication to the grapes that brought it acclaim is no surprise, and market forces are likely to keep it that way. An acre of vineyard in the valley’s prime appellations can run $400,000 now, per the American Society of Farm Managers & Rural Appraisers. Few growers are willing to pull out their ever-popular Chardonnay or top-dollar Cabernet Sauvignon just because Millennials are interested in offbeat varietals, McMillan says.
But if Napa is to truly retain its position atop the American wine scene, the changes will have to be dramatic, Mabray says. What kind of industry relies on consumers to come to them? Or ignores the tastes and shopping habits of the next generation?
“We’ve been blessed by success. It’s been almost 20-30 years of double-digit growth,” Mabray says. “But it’s a flawed model and it has to change.”
David Ferry is a freelance writer in Los Angeles. Email: [email protected]