Brand Packaging

Consumers Not Boxed In By Wine Packaging

July 1, 2006
Consumers Not Boxed In By Wine Packaging
By Dana Dratch

With more premium offerings entering the box format, Americans are beginning to think outside the bottle.
In the past few years, a host of American wineries have joined a global trend in packaging their products in boxes.
In Sweden, 65 percent of wines sold are in the box format, according to ACNielsen data. In Australia, the figure is 52 percent. And in Norway, boxed wines make up 40 percent of all wines sold.
“The whole world is going toward convenience packaging,” says Chris Indelicato, CEO of Delicato Family Vineyards, which has been packaging some of its wines in boxes for three years.
And it’s not just for the sake of novelty.
“The marketing world is full of gimmicks,” says Ryan Sproule, president and founder of Black Box Wines. “This is one of those things where there are real tangible benefits.”
Such as, wine in a box that is opened keeps for a month, instead of a few days. It is also lighter to carry and ship, so it’s less expensive.
“It’s 40 percent lighter than its equivalent in a glass bottle,” notes Diana Pawlik, marketing director for the Centerra Wine Company, maker of the Trove brand. That means it’s less expensive to ship, less expensive for consumers and easier to carry to special events. Boxed wine is also becoming popular with small independent restaurants, because it’s easy to store and keeps so much longer.
And while no one is predicting the demise of the bottle (a wine tradition several thousand years in the making), more and more American winemakers are adding the box to their packaging menu.
Perception or reality?
Not so many years ago, wine connoisseurs looked down on alternate packaging formats. Their general consensus: if it comes in anything but glass with a cork, it must be a lesser quality.
Can today’s boxed wines overcome that prejudice? One fact that is changing public perception: good wine going into boxes.
“There’s been a renaissance with boxed wine of late—particularly at the premium level—as people figure out it’s just a container, you can put whatever you want in it,” says Charles Bieler, co-founder of Three Thieves, a U.S. pioneer of the box format.  
Indeed, winemakers are putting more varieties into boxes—everything from chardonnay to merlot, cabernet sauvignon, and pinot noir.  
Ryan Kukol, associate brand manager for the Select Brand of Kendall-Jackson Wine Estates, agrees that the time is ripe for premium boxed wine. “I think it’s becoming more accepted in the United States,” he says, likening the issue to a similar industry debate over screw caps. “It’s just a matter of time before the American consumer catches up.”
In Australia, where boxed wines account for about half the wine sold, the Hardy Wine Company claims more than a third of the boxed wine market. Three years ago, it launched Hardys Stamp in the United States and offered the same varieties in both bottles and boxes. According to Sally Osborne, marketing director for Pacific Wine Partners, maker of Hardys Stamp, there is still a “stigma” in the United States that the boxed wine industry is trying to overcome. As a result, she says, the company made a direct effort to communicate that the box had the same tine—the same quality of wine—in a box.
A premium look
As better wine is beginning to go in, the box itself is also getting a makeover. Today’s winemakers are using a variety of high quality inks and finishes on their boxes to signal that the product within is equal to its bottled brethren. Manufacturers are using more high-end printing processes, embossing, debossing, and foil stamping and higher end inks to give a more premium look to the boxes, which are looking and functioning more like traditional graphic-intensive wine labels these days.
Some brands are also starting to experiment with different sizes. While five liter and three liter boxes (the fastest growing segment of the market) were once the standard, 1.5-liter formats have also hit the market within the past few years.
Several winemakers are also tinkering with the shape of the box. Hardys Stamp, for example, elected to use a square box, rather than the rectangle typical for many of the five-liter boxes. “Consumer research said that they find that shape to be more premium,” says Osborne.
And DTour, which packages premium wine in a tube-like container, believes that the brand’s unique package may help avoid the stigma that most boxed wines face. “The nice thing about the tube is that it feels more like a wine bottle than a box, and I think that works in our favor,” says Sam Potts, a principal with Sam Potts Inc., the New York design company that created the packaging.
The company kept the design simple, and used an understated but warm color palette of cream, red and blue.
“The typography is very simple and clear. That’s based on the simplicity of the package itself,” says Potts. “This isn’t something that’s too fancy and unusual for the average wine buyer. At the same time, it’s not something that’s too cheap-looking for the higher end wine buyer.”
Hardys Stamp also wanted its packaging to stand out but wanted to position the brand as “very approachable wines made to be enjoyed when they’re young and fresh,” says Osborne. So the brand used hot bright pinks, purples, greens, yellows, reds and blues to indicate various varieties.
With the Wine Block, Kendall-Jackson also chose bright colors. Depending on the wine variety, the dominant color on the package might be mango, purple or fuchsia. It was “a nod to women” (who, industry stats show, do most of the purchasing), says Kukol. “And we had things in mind like the Apple computer and iPod—very youthful, appetizing colors.”
Black Box did just the opposite with its color scheme, using black as the primary color of its packaging. “Black is often associated with quality or luxury. That’s why I chose it,” says Sproule. “And I wanted something to stand out—all of the other boxes were white.”
Usability has also been a key point of difference, with consumers reporting that they love pressing a button on the package and instantly having a drink in hand. “There are a lot of convenience factors there,” says Sproule. “And we made it the same size as a milk carton so it would fit all the places a milk carton would. I’ve always been annoyed trying to get wine to fit in the fridge.”
Sproule notes that the Black Box package includes a description of the wine and the vintage date. “I tried to do all the things you would expect on a $12 bottle of wine,” he says.
Though he also points out that Black Box doesn’t hide from its packaging approach; it’s part of the company’s slogan: “Think inside the box.”
“Lots of wines are apologetic about being in a box,” he says. “We’re in a box, and we’re proud of it.”
Who drinks boxed wines?
Typical boxed wine drinkers range from the mid 20s to mid 50s and they have good salaries and good educations, according to several vintners.
The premium three-liter buyers are “much closer to the profile of a 750 ml (bottle) buyer,” says Danny Brager, vice president of client service for the beverage alcohol team at AC Nielsen, which has studied sales and buying habits in the category.
And there seems to be a marked difference between the five-liter purchaser, which declined five percent in sales volume last year, and who is buying three liters, which increased in sales volume 70 percent according to ACNielsen reports.
Three-liter buyers “tended to be younger, more affluent more educated,” Brager says. “Basically, to me, a different kind of consumer.”
“The typical consumer is very much the 750 ml (bottle) premium wine consumer,” says Pacific Wine Partner’s Osborne, adding that buyers are educated with a degree of wine knowledge. “I think we see them in their mid-30s to mid-50s. We know that women are buying the majority of wine, and women are doing the majority of grocery shopping. But [consumption of the product] doesn’t seem to be leaning male or female.”
For the Wine Block, drinkers tend to be 21 and on up to their mid-30s, according to Kukol. “[They are] really interested in discovering wine and becoming interested in wine,” he says. “Not as resistant to change. Don’t have any of the stigmas attached to boxed wine that older consumers might. Generally more educated.”
In fact, with the current generation of boxed wines, consumer education is a big piece of the marketing plan for many winemakers.
When Black Box launched three years ago, word of mouth was one of the most important components of the company’s marketing effort. “I started out only selling to shops that had clerks on the floor,” says Sproule. “I was afraid if I put it in a grocery store, it would just die. There was lots of hand selling the first year or so.”
One point that’s helping many boxed brands: growing acceptance of wine as an everyday staple.
“A nice package, endorsed by people used to quality, sends the message that it’s OK,” says Daniel Johnnes, who along with Daniel Boulud and Dominique Lafon, formed the trio behind DTour. “Everyday consumption, not a special occasion, that’s the idea of the package.” BP
The author, Dana Dratch, is a freelance writer based in Atlanta.
Where to go for more information...
Market research. At ACNielsen, call 646.654.5000 or visit www.acnielsen.com.
Package design. At Sam Potts Inc., contact Sam Potts at 646.325.5575 or visit www.sampottsinc.com.