"If there is nothing to differentiate one wine from another then there is no reason for a winery to be in business." This is a sentence out of a white paper entitled "Building Brand Equity in the Wine Industry" by Brandon Westling of Tincknell & Tincknell published during the last downturn (2001), one I might add that was much less severe than the one we are now in.

In a more recent study, Differentiation or path dependency: a critical look at the Australian wine industry by David Ayleward of the University of Woologong, Australia, he suggested "In 2007 the Australian wine industry is at a crossroads, both organizationally and culturally. Having achieved considerable success over the past three decades, the industry is now operating in the shadow of that success. Rather than adapting to new and multiple operating pathways of a global wine landscape, industry organizations continue to steer their sector along the entrenched and restrictive pathways of previous achievement."

Here a clear call for a whole wine industry to differentiate.

Simple answer: All businesses need to differentiate themselves in order to attract customers and stand out from the crowd. It doesn't matter what business you're in.

However, there is a critical need for wineries to differentiate. Why?

• At current count there are almost 7,000 wineries in the US alone (70,000 worldwide) - lots of competition
• Wine is still confusing for many; with so much choice and confusion, there is a need to guide prospective customers to your door
• There is a global recession; wine continues to sell, but there is fierce competition and price pressure
• Money is tight; cash flow is king for any business - and certainly in the wine industry
• Most importantly: there has never been a better time to target and connect with current and new customers

Businesses have always attempted to provide clear differentiation for their products and services. However, in traditional marketing accurate targeting of potential customers and communicating that differentation, is sometimes very challenging.

With the availability of the internet and subsequently social media and networks, wineries have a cost effective way to both target - and more importantly -  establish a dialogue with their customers.

First .. let me apologize for the pun!

In a recent blog "Grape Differentiation is a Must!", I highlighted a definition from Wikipedia that related several important points regarding marketing differentiation. The most salient of these included determining differentiation in conjunction with a winery's overall marketing plan and strategy, completing accurate targeting of prospective customers, and finally, clear communication of that differentiation to the target audience.

The one point not covered in the definition was that today a business is not relegated to defining differentation in regards to products and/or services only. Wineries can be much more thoughtful and aggressive and seek differentiation from a long list of possibilities. A winery's 'brand' can take on some additional perspective beyond the product and service itself.

There are two major benefits in finding new ways to differentiate through social media and networking. The first is cost. The monetary investment needed to leverage social media and networking is relatively small (although time investment can be considerable). The second is the ability to accurately target and dialogue with potential customers. This is one of the greatest benefits of social media and the reason that choosing genuine (more on this later) differentiation can substantially increase a wineries ability to attract and convert new customers.

The traditional method of marketing differentiation focuses on products and services. For wineries, the product is wine (one or more varietals, special blend, various formats) and the service might include customer service, tasting room hospitality, newsletter, and wine club.

Looking again to the "Building Brand Equity in the Wine Industry" white paper, several points of differentiation were suggested including:

• A unique feature of the winery (Oldest, smallest, etc.)
• A unique feature of the winery's geography (grapes grown on hillsides, grown in another country, etc.)
• A unique benefit (won't give you a hangover, impress your friends, etc.)
• A unique application (best when consumed with spaghetti, best when used in sauces, etc.)
• A unique consumer (generation X, baby boomers, alternative lifestyles, etc.)
• A category leader (zinfandel specialist, environmentalist, etc.)
• A winery may also target the same market as a stronger winery but differentiate itself by focusing on a weakness the stronger competitor may have that the market would identify as valuable. This is often done with generic products by offering an almost identical product but capitalizing on the high price of hte brand name product.

There are of course many wineries that do differentiate in product and service only. Some focus on vitis vinifera varietals that are not that well known such as Torrontes, Tannat, Albarino, Muscadine or on a well known varietal (say Cabernet Sauvignon), but do so based on location and reputation (Napa Cabernet Sauvignon, Carneros Pinot Noir, etc.). Others may focus on a different family, for example native American varietals), such as Catawba, Concord, or Niagara, or perhaps non-grape wines such as blueberry, blackberry, or peach.

This focus on product can work well on location or on the net, but it is somewhat limiting. It narrows the focus to those who may already be aware that a particular varietal is of interest, but conversely it is hard pressed to gain the attraction of others that might be interested but are not currently familiar.

However, combining the advice above from the Tincknell & Tincknell report with several other options (noted below), wineries can in fact identify a myriad of differentiators that can be used separately or together to find, attract and connect with new customers for its wines.

Beyond product and service, where can a winery differentiate itself? As suggested above, there are many other ways to differentiate beyond the traditional product and service alone. Here are some other general categories to consider:

• Location (& Teaming)
• Methods and Processes
• Culture and Lifestyle
• Passions
• Philanthropic Activities
• Other

Napa Valley, Mendoza, Paso Robles, Rioja, Stellenbosch, Mosel-Saar-Ruwer - all of these locations have multiple wineries. Visitors who are planning or may in the future plan a trip to these or many other wine destinations are interested in wineries to visit. They may also be interested in restaurants, hotels, as well as other activities in these locations.

Wineries can differentiate themselves in a particular region through events, special offerings, as well as relationships with travel and tourism organizations in the region. For instance, a special relationship with a touring service, hotels, restaurants as well as other amusements. Each of these can help to increase visibility for the winery and drive traffic locally.

From a social media perspective, wineries can make these events and relationships known so that their fans or followers are aware of them and will take advantage when traveling in the region. One example could be a Facebook page entitled "Friends of Paso Robles" whereby a winery or two get together with multiple restaurants, hotels and local tourist board to build enthusiam for visiting Paso Robles, and in so doing, increasing business for each member in the group.

Green is a word that has many passionate followers. Whether that means solar panels, wind power, or water reclamation, there are many individuals and groups that have a great deal of interest in these technologies or processes and would want to patronize wineries that identify themselves as being "green".

In addition, there are more and more individuals interested in wineries that are organic or that practice biodynamics.

Can you think of some wineries that differentiate themselves based on organics or biodynamics?

Examples: Parducci Wine Cellars, Chateau Val-Joanis, Benziger Family Winery, Navarro Vineyards, Rodney Strong Vineyards, Fry Vineyards, and many others.

With social media it is easy to target like-minded individuals on sites such as Facebook, Twitter, and LinkedIn. Simply search for groups that have such an interest, join the group, and participate, key word being Participate.

Kosher wine, women owned and operated, fifth generation family run, celebrity owned, "languages" spoken here", all of these reflect something of interest to prospective customers.

With the majority of wine being bought by women, and wiith over 55% of the fans on Facebook women, it stands to reason that women owned and operated wineries can use this as one of its differentiators. Family owned and operated is also often of interest to people as well as celebrity owned and operated.

There is no rule that says a winery can't have more than one differentiator!

We all have passions (besides wine that is :-) - sports, outdoor activities, animals, photography, travel, music, rock and other hobbies can all be used by a winery to help draw interest of similarly passionate prospective customers.

As an example, for canine lovers a winery might produce a wine or line of wines that features dogs on the labels. Or, it could sponsor events that would be of interest to dog lovers.

Another example might be the posting of albums or similar based on one's passion for photography. A winery could search for social networks that focus on photography, then identify groups that love photography and wine. Again, join the group and participate. Perhaps build links to your website and/or your fan page on Facebook.

Another is to use the passion as the driver, such as done by Sacrebleuwine where rock music and concerts help to promote the wine.

Just remember ... the approach you take on your website (direct sell) will not resonate well on social networks. The approach on social networks must be to "share" the passion, not directly sell the product.

There are many wineries that donate wine, time, money or all of these to specific charities or charitable events. Notwithstanding the sincere desire to give back to the community, a philanthropic focus can be a great differentiator for many individuals and wineries.

For instance, a winery can combine their passion for animals (again taking dogs as an example), and combine that with a charitable event that will help the local animal shelter, to improve and/or expand the faciliites. Or, perhaps provide donations and funding for a local food bank or other worthy cause.

The point is that if a winery is truly passionate about giving back, by using this focus as a differentiator and connecting with a new target audience, it can help drive incremental sales, which in turn will increase its ability to make a difference. The best of both worlds -  for the winery, its customers, and the charities it supports.

Finally, a winery can use its imagination to find other unique things about itself. Case in point, labels with Marilyn Monroe, Trucks, caricatures, or fine art.

The possibilities are endless. The only limitation is that it must be of interest to some targeted group of current customers or prospective customers, and it must be genuine. In social media, faux passions or differentiators are spotted quickly and will result in negative press.

In order to increase interest in the business and the wines, a winery must define its differentiation, use it to identify a target audience, communicate it to that target audience, and then connect with that audience to grow the business.

Whatever differentiation is chosen, it must be an integral part of the business and marketing strategy, and it must be genuine and honest. After all, it is the connection to the target audience.

The good news is that the options abound, and they are only limited by one's imagination.

So.. what are you waiting for?!