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Is the Wine Industry Ready for New Label Technology?
Many in the wine industry are talking about the new label design that is revolutionizing the industry. These are people pointing out that there are new label papers, foil applications, embossing techniques, shrink sleeves, colors and scannable (QR) labels. Yes, there is a new look to wine labels. But a new approach that will capture the imagination uses captivating technologies, combines tantalizing colors and has shown research that customers are compelled to impulsively pick up and handle the product on which the label appears. When was the last wine label you saw that you got to experience?
This new label product being promoted in the wine industry is a hologram. Holograms have been commercially available since the mid-1970s National Geographic magazine introduced a small holographic image of an eagle on the cover of a monthly issue. I saw it and was amazed that it could be seen on the side of the eagle and then on the opposite side simply by turning the magazine cover.
I was a marketing director for a Manhattan company and was so intrigued by the holographic image that I wanted to use it in our consumer brochures. The main drawback was the price of the holographic image; approximately $2.00 each. Today hologram labels can be made, in volume, for as little as $0.05 each, 1 x 1 inch. Pre-production/setup costs would be approximately $2,500. A front label for wine could cost about $0.74 each for a size of 4 x 3 inches.
“The actual costs depend on how sophisticated the final image needs to be to get the desired visual effect,” says Mr. Alec Jeong, General Manager of Sales at Integraf, a supplier of holographic labels. “For a high-quality hologram, pre-production can start as low as $1,000 for something as simple as a logo or go up to $8,000 for a gorgeous display that combines 3D depth, animation and stunning reflections.”
What makes holograms so interesting? Holography is a photographic technique that records the scattered light of an object, and then presents it in a way that appears three-dimensional. In the 70s the object to appear in 3-D the model had to be the actual size of the image to be generated on a special paper with lasers.
New techniques now make it possible to generate 3D images using computer graphics modeling that can be applied to laser-type images to generate 3D effects.
What makes the application of 3D holographic labels so interesting for the wine industry?
· Holographic images produce 3D effects that capture the consumer’s attention when browsing wine racks. Apps can be adapted for vertical or horizontal bottle views.
· Producing a 3-D label today is cost effective.
· Holograms can be used to combat the counterfeiting of some wines.
· Holographic images can be adapted to many marketing requirements: branding, neck hangars and attention grabbers for consumers walking down an aisle. For example, some holograms can produce a burst of light when you walk over a hologram tag.
· The entire label does not need to be made as a hologram.
· These labels speak to the tech-savvy millennial generation. This demographic represents over 60% of the wine market and is driving wine sales growth.
Ms. Toni Hamilton, Marketing Director of ASL Print FX, has laid out some guidelines for effective wine labels. Do the holograms fit your guidelines? She asks, for example, on a store shelf, will the label draw attention in 3 seconds? Some research already done by Integra indicates that holographic images work well. Will a holographic image reflect the wine, the winery and the target market? Each demographic responds to messages and the delivery format of a message differently. The investigation and evidence would be the judge; Learn more about Marketplace apps. Finally, in almost all markets, demographic tags should be fun, can be humorous, use unique graphics, and can be a little weird.
A label design company in Napa said there are exceptions to most rules about good labels; the livestock images on the labels, however, are outdated.
We know that wine labels are or can be: art, informative (partly by law), entertaining and used to influence consumer action. Below are some thoughts on a wine label’s interaction with the consumer.
As a consumer, do you think we are immune to manipulative marketing tactics? we’re too smart for that trick, aren’t we? But, we don’t have to get defensive about wine marketing tactics because the label can give us a lot of information (not just legality) about the brand options available. Labels create lasting loyalty, stimulate new wine trials, encourage enjoyment/expectations (psychology’s mental expectations) and allow us to connect with the creators of some of our favorite wines/wineries and winemakers. Combined with the Internet, we can now be more educated about our wine purchases and become educated brand evangelists for great cheap and expensive wines.
The life and value of a wine label is based on research and testing. And research shows, “The more the consumer likes the label, the more they like the wine.” At least that’s according to Mr. David Schuemann, owner of CF Napa Brand Design, a top-rated label design and marketing firm in wine country.
David Ogilvy, an icon in the advertising industry, had many quotes about using visuals to sell products. One I appreciate, which can be applied to holographic wine labels: “If you grab attention in the first frame (applies to TV commercials) with a visual surprise, you have a better chance of holding the viewer. ads because they open with something boring.” “On average, five times more people read the headline than the body copy.”
Aside from advertising (print, television, direct response), the wine industry in general has one important marketing tool in its bag of tricks to reach the consumer and motivate them toward that first taste: the label is an important tool in the bag. The label cannot carry and perpetuate a bad brand, product or image to success. But, it will encourage a trial and then turn to a repeat customer.
Monthly of the wine business has reported that in the Hispanic market 70% of the wine purchase decision is related to price, recommendations account for 40% and label design accounts for 14% of the purchase decision. Obviously, there is a lot of crossover between categories, but the relative importance of wine labels is enough to make it important in selling wine. If family recommendations occurred because of a tag-initiated trial and a follow-up recommendation, tags could impact sales by nearly 30% of trials and repurchases.
Mr. Kyle Swartz, reported a Beverage Dynamics, January 2016: “On labels, 46% of women said they are intrigued by ‘traditional/classic/sophisticated’ designs. 39% are intrigued by ‘fun and whimsical’ looks, while 37% noticed labels that indicated ‘organic/sustainable’ wines. ‘Resourceful and clever’ appealed to 36% of respondents, and ‘benefiting a cause I care about’ intrigued 30%.’ Do you think any of these answers factor into the holographic tag discussion?
These comments are important given that 83% of wine is purchased by women, of whom 36% are millennials and are mostly focused on buying experiences rather than just the product itself. Since the United States is the largest wine market in the world, labels are extremely important. It’s also worth noting that Swartz reports that 53% of women browse by tags. As Ogilvy noted, the first frame (replaces “visual impression” for our discussion) will prompt further exploration.
Wine is again the focus of growth, attributed mainly to millennials. As a demographic, millennials make up approximately 60% of the US market and focus on wine purchases in the $11-$20 wine bottle range. However, labeling strategies are not necessarily driven by the price of a bottle of wine. At ALL price points for any product, the product is repurchased based on a price-to-value ratio. No one buys Two Buck Chuck thinking the quality/value is a bottle to be stored for 10 years or put in a fine wine auction at Christy’s. But at any cost, tags will generate evidence for the value proposition and this is communicated with a brand strategy.
In an attempt to prove that I’m not out of touch with reality. We all recognize that there are many components that influence our wine purchasing decision, aside from acquired or established personal preferences for a specific wine. For this discussion, we focus on the tactile and visual issues that make us first taste a wine that we see for itself, these do not appear in any order or inclusion.
· Label design
· Weight of the bottle/product
· Type of closure (cork or screw plastic caps would not be visible under the aluminum foil)
· Description of the wine on the front and back labels
· Knowledge of the wine producer
· Recommendations (friends or merchant or winery)
Aside: More recently, a lot of attention has been paid to the wine market in China. Here the label is very important because of the traditional importance of images and colors. Interestingly, colors like red, gold and yellow connote wealth, good luck and elegance.
I came across a 2010 study written by Vince Bonofede of California Polytechnic State University. The title of the research is- ANALYSIS OF THE AESTHETICS OF THE WINE LABEL DESIGN AND THE CORRELATION WITH THE PRICE. Contrary to the title of the study, it did touch on label design issues in wine selection. The study was based on mathematical and regression analysis and analyzed 7 categories of rules relating to design aesthetics.
After a complex analysis, Bonofede concludes, “Ultimately, wine is meant to be enjoyed, not a stressful stroll down the wine isle. If the wine label is what catches your eye first, do it and enjoy.” That is, if a wine label was aesthetically pleasing to the consumer (i.e. color, shapes, font sizes, etc.), then the label could have an overall effect on the consumer’s opinion of the wine (Burnhard, Martin and Troncoso). (2008).
I think holographic labels will soon make inroads into wine labels. Using these images will certainly promote product trials, conversation, reading labels for information, promote the brand, and promote a long-lasting product and winery image. The frequency and impressions of this tag should be explored as a component of marketing.
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