Never liking surprises, top 10 US vintner warns wine business to watch out for what’s next

As with others in the business, how to keep younger people interested in wine can cause Jeff O’Neill sleepless nights.

That’s because the CEO of O'Neill Vintners & Distillers knows younger people are more apt to choose to consume a ready-to-drink coolers or cocktails than a bottle of wine.

“I feel, and maybe it’s wishful thinking, but I hope it’s not, that as consumers grow up, they will gravitate to more sophisticated beverages like wine,” O’Neill said.

He knows these types of beverages have come and gone through the years; mentioning how California Coolers was a thing in the 1980s but aren’t even on the market today. O’Neill knows RTDs will never totally disappear, noting how there are more of them now than ever before.

In the same breadth, the 66-year-old admits people in the wine business need to change.

“I think our industry missed the boat in that we have not been thoughtful in making wine accessible to consumers entering legal drinking age,” O’Neill said.

He points to how people are told which varietal pairs best with certain foods, that a certain glass should be used, and that the temperature of wine matters.

“There is a whole generation today that doesn't want to hear about it. They want to hear about how delicious it is, why they should drink it and what the ingredients are,” O’Neill said. “We need to evolve our language and how we communicate with younger consumers.”

The following is a Q&A between the Journal and O’Neill, whose company is based in Larkspur in Marin County. It has been edited for clarity and length.

Since you founded the business in 2004 it has grown into the 10th largest winery in the United States. What are your goals going forward?

Our goals are very simple. We want to continue to make better wines, offer a broad range in all price points that appeal to many people. We do like to grow. Then we can make investments in technology, people, serve our communities better, and of course continue our environmental stewardship initiatives. Not growing, in my opinion, is the same as going backward.

O'Neill Vintners & Distillers became a B Corp in 2022. Why is this designation important to you?

I am very proud of our B Corp certification. It is an incredible acknowledgment of all the hard work from my team across multiple initiatives over the years to ensure we do good by our employees, the environment, and the communities we serve.

B Corp is really a way of using business as a force for good. It ladders up many different impact areas where businesses can and should do their part to help improve. This includes environmental stewardship, corporate governance, social responsibility, and other important areas.

O’Neill is known for having a diverse workforce and supporting BIPOC youth with college scholarships. How does this inclusion help your business?

I think the world is full of inequities, and to the extent that we can use our success to change that and give other people opportunities that they may not have ordinarily gotten, but should have, is important.

Having a diverse workforce allow us to have a broader range of ideas, solutions, and ensure our company's make up represents that of the marketplace.

Our initiatives to support black students is our way to try to help solve the lack of diversity that still exists in our industry. This also has become an important source of pride across our employees that we are acting on social issues just as much as we are taking care of the planet.

How do you motivate people?

What we try to do is give people a responsibility and then let them pick up the ball and run with it. That has been very successful for me in many areas. My team, I believe, understands I'm not a micromanager, however, I will occasionally stick my nose into something frivolous.

What is your approach to making tough and important business decisions?

We really take a team approach. There are of course times that I feel very strongly about certain issues and will push my team in one direction or another.

But we have built this business by empowering our team to run their individual functions. We ensure that we lean on data, insights, and market intelligence to inform our discussions and decision making. We try hard to ensure multiple and diverse perspectives are heard and considered.

What aspect about your business keeps you up at night?

Probably the most significant challenge we are facing today is how to attract younger customers and increase their consumption frequency with wine.

The number of new offerings in the drinks business has increased significantly between RTDs, seltzers, distilled spirits, cannabis, and others. I am hopeful that we will get the new generations to appreciate the time and care it takes to craft exceptional quality of wines. How our industry and brands are a perfect complement to food. In contrast, I am also hopeful that they will recognize that mango seltzer does not go with dinner.

I think our industry is in for a transition, where we will be dealing with fewer customers potentially unless we find a way to bring in very large numbers of Gen Z and millennials. We will definitely try to do that; I'm just not sure that we can with all of the alternative beverages that are available to consumers today.

Other than money how do you measure success?

I think success is really measured around how people view your business, and that of course includes our employees, suppliers, partners, and consumers.

An income statement is only one element that makes up the whole. Of course it is very important, but I believe in today's environment that companies have to be thinking about what the future looks like, sustainability, an employee first attitude, and of course trying to diagnose what consumers really want and will pay for.

What one government regulation would you change and why?

That's certainly a loaded question. I don't know that there is one thing I would change other than to send a message to Sacramento that doing business in California has never been more difficult and problematic. The state continues to drive high earners out of the state, and always seems to be looking for a way to raise taxes.

How does the national economy impact your business and what are you doing about it?

The national economy certainly has an impact on our business. It has been tough to evaluate post COVID. I think we all experienced the substantial upturn because of our retail presence during COVID, pantry loading and uptick on at home consumption.

Now we are facing a different issue, and that is probably a potential recession, what impact that may have on spending habits, and in turn would influence some of our products (we have wines that sell for as little as $6 a bottle up to $50 a bottle) to fit the budget. The consumer may move around in that space.

What lesson did you learn early in your career that you now recognize as an important one?

I had a great mentor very early on, when I was very young, in my mid-20s. He had one fundamental rule which was there will always be issues with business, just don't surprise me.

That was a great lesson to bring bad news forward immediately when you know it and be able to take action.

What would you redo in your career and why?

There are certainly many mistakes I've made, most when I was younger, but those are the formative years. I really don't have many regrets in my career. I was always supported by individuals who believed in my ideas, even when I may not have believed them myself.

What was your first job? What was your first career job?

My very first job was working in a small ski shop in high school. My first job post college was working as a street salesman on the peninsula, when there were hundreds of tiny liquor stores scattered throughout the state. I hated every minute of it.

Is this the job you wanted when you were young? If not, what were your earlier career aspirations?

Well, when I was a child I wanted to be a train engineer, then in high school I wanted to be an architect, but the math proved to be a bit overwhelming. So, I fell back into the entrepreneurial wine business.

How do you spend your time outside of work?

I have quite a few hobbies outside of work, they include collecting and racing historic race cars, and a few other pursuits you would suspect including golf, skiing (water and snow), speedboats and a few other things.

In addition I founded Velocity Invitational. It features rare and historic race cars on track and showcases the newest technology in race cars and super cars. It also brings together lifestyle elements including great wines, spirits and food.

What advice would you give someone just starting his or her career in your industry?

Pick a lane and stick with it. Although I think luck has a lot to do with ultimate success.

But one must be willing to take very substantial risks along the way. But with that in mind, success can be achieved by anybody that is willing to stick their neck out, and realize when you're young, it feels like you're sticking your neck out, but the truth is you probably have nothing to lose except maybe some dignity.

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Kathryn Reed is a journalist who has spent most of her career covering issues in Northern California. She has published four books, with the most recent being Sleeping with Strangers: An Airbnb Host’s Life in Lake Tahoe and Mexico. She may be reached at kr@kathrynreed. com, or follower her at kathrynreed.com, Twitter @Kathryn0925, or Instagram @kathrynreed0925.