Rob McMillan is one of the top wine-business analysts in the United States and the author of Silicon Valley Bank’s highly regarded annual State of the Wine Industry Report. He is a prominent speaker, both domestically and internationally, and he is extensively quoted in national, regional, and trade press. He has been named several times as one of the Top 50 Most Influential People in the US wine industry.
Outside of the wine industry, McMillan is a father of five. He enjoys the outdoors, travel and golf and takes any opportunity to play percussion and drums in live settings.
Editor’s Note: This interview has been edited for cohesion and clarity.
How did you become a wine industry analyst?
That’s a little bit of a long story. Let’s start with Silicon Valley Bank. I joined the bank in 1990 and the goal at that point was to start business verticals. I’m a creative person; a musician, but also love math and economics. It’s a rare combination of talents but just what is needed for strategic thinking.
I was given the opportunity to find new businesses for the bank so started writing industry plans in 1991. The wine business was the second business plan I wrote – the first being mortuaries which is a long story but that didn’t turn out. The wine industry plan was approved however, and the industry group launched in 1994.
That first year I had a board presentation due that required current industry information. While there’s plenty of information on the industry as a whole, it was impossible to get things like data on inventory, sales, and depletions by winery size, region, or sales channels. That is when I decided to do the first Silicon Valley Bank survey and used the best technology available, a fax machine.
People filled it out and faxed it back. I got the information I needed for the board report but then thought I should give the information to the people that participated. That was the beginning of the State of the Industry Report and the start of my analyst career.
By the mid-2000s the wine business plan was fully executed and was proven successful. With the Division at 35 people on staff, I handed off management responsibilities and started focusing full time on producing content and analytics.
Did you meet any industry resistance when you started the business?
I thought I might get some resistance just because of the bank’s name, Silicon Valley Bank. We did get the occasional person questioning what we were doing in agriculture at first, but there was no real resistance and for that matter and that was because there was no real bank competition for new business when we started.
The wine industry was in a downturn in the late 80s and early 90s. The three banks who were in the business back then felt they had too much industry share and were trying to trim their portfolios. They were our greatest referral sources. As a result, we grew faster than we had planned and had the enviable problem of not being able to keep up with staffing.
How would you counsel writers that are serious about covering the industry that may not have the platform you’ve developed?
I probably would first say, don’t quit your day job. What we used to think of as journalism has fallen on hard times and that’s unfortunate. There are fewer jobs. All of the media has been disrupted by the internet, but jobs in this little industry make it very difficult. That said, while the internet disrupted traditional media, it does give aspiring writers easier access to an audience through social media and blogging. That’s perhaps the best place to start. If you have something to say, talk to interesting people, find interesting content, and you will find an audience.
For the State of the industry report, we just released the 21st annual report in 2022, and still don’t charge for it. So how do I get paid for it? Well, the question about monetization isn’t just subscription, so you have to open your mind up a little bit and figure out how somebody might be able to use what you’re doing in other ways. And if you can create value, you probably can create a revenue stream.
When people read the state of the industry report from Silicon Valley Bank, it enhances our brand. People recognize we’re experts at what we do. It puts us in the middle of deals that we might not otherwise see because Silicon Valley Bank is top of everybody’s mind. So that is one example of finding a different path to success in journalism.
What industry writers’ do you follow for leading-edge ideas?
I don’t follow many. One of the issues the wine industry has is we talk to each other too much, so we all start to say the same things, have the same buzzwords, and boring strategies.
I try to break out of the pattern and attend conferences that have nothing to do with my subject matter. I keep up on current economic data, watch the business news, and voraciously read all the industry analyses I can, including Nielsen, Wines Vines Analytics, SipSource, and many others.
Can you just describe your approach to research and writing?
Research is really about just being curious and drawing out information from data. You have to always be asking why.
With writing, if I don’t have something new to add to the industry conversation, then I generally don’t say it. But the other important factor in writing or speaking is finding some way to be entertaining. I don’t believe people today will read something boring.
If you go back and read some of the earlier reports that I used to write in the late 90s and 2000s, I would lead by talking about a film, whether it was Field of dreams or Wizard of Oz. I would use that as the canvas to discuss something that was happening in the industry. At first, our marketing department would question me, only because that wasn’t the way business writing had been done up to that point. They said nobody would listen to me if I took serious economic and business research and add humor to it. But over time, the view on writing has changed to the point where corporations now prefer to have an individual be the face of a report, versus the company’s dry brand.
Will wineries continue to see good conditions in 2022?
The results that we are interpreting thus far for premium sales are solid but belie the fact that as a full industry, we have some long-term headwinds, more than any time since the 90s. Our traditional consumer on ramps, those occasions where consumers could discover wine are failing. Whether restaurants or under $11 wines in grocery, we are giving market share away to the spirits category.
I think 2022 will be a good year in part because of pent-up demand, high consumer savings rates, and business normalization. Wine and hospitality are linked on occasion in larger groups, concerts, sports, travel, cruising, etc. and these will increase through the year and provide new opportunities.
You’ve been working on a national marketing organization and feasibility studies with UC Berkeley and McKinsey Group, and now moving into execution phase. How is that progressing?
It’s important first that as an industry, we start to acknowledge the issues that will impact our industry for decades to come. For more than two years I and three other analyst colleagues have been meeting with a large representative group of larger wineries and have consensus that there is a demand problem that needs to be addressed. Now we need to take the message out nationally.
We’ve gotten through the feasibility studies and announced the formation of WineRAMP (Wine Research and Marketing Project). We did that through the last Silicon Valley Bank videocast. Since then, we’ve had hundreds of people signing up for more information on the WineRAMP web page. The interim step is to listen to reactions in the industry. If we can find alignment, then the organization will have to be funded and taken over by the industry. It’s not an easy task finding agreement in this industry, so I think the odds of success are no better than 50/50, but that is better than two years ago when I put the odds at 100 to 1. To steal a line from a movie, “so you’re saying I have a chance!”
Tell us something that people would be surprised to know about you.
I have diverse interests, so I think many people know at this point that I’m a musician, I mention it often. I started playing drums and percussion when I was five. But, I’m an outdoorsman as well and like hunting and fishing. It’s probably less surprising to know that I like to golf. Imagine that? A banker who golfs?
“Turning the Tables – Interviewing the Interviewers” is a Q&A series profiling Wine Writers. The objective is to understand and develop working relationships with journalists—those that help tell our stories, review our wines, and provide media coverage—by learning their wine and writing backgrounds, story and personal interests, palate preferences, writing challenges and pet peeves. This is an ongoing Wine Industry Advisor series.
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CARL GIAVANTI is a Winery Publicist with a DTC Marketing background. He’s celebrating his 12th year of winery consulting. Carl has been involved in business marketing and public relations for over 25 years; originally in technology, digital marketing and project management, and now as a winery media relations consultant. Clients are or have been in Napa Valley, Willamette Valley, Walla Walla, Columbia Valley and the Columbia Gorge. Visit Carl Giavanti Consulting