We recently presented at the Wine Technology Symposium in Napa and got to spend time talking about three of our favorite things: wine, business and technology. Industry leaders were buzzing about digital D2C and how to find, nurture and convert wine consumers online. It’s an evolution long overdue inside an industry where a great majority of wineries use the distributor and retailer model to be lazy – or, better yet, passive – about consumer segmentation and getting to know the vast majority of the people who consumer their product outside the tasting room (who, by the way, are not the same people visiting wineries).
While this conversation is a huge passion for us at Groove, and deserves an entire series of blog posts, there was something NOT happening at WITS that really fascinated us. While everyone was abuzz about the consumer potential of digital engagement we were the only team talking about its commercial potential. 90%+ of producer income (that’s nine out of every ten dollars) is derived through 3-tier distribution where the digital revolution has changed the way producers communicate with distributors, trade partners, peers, press and consumers to dramatically affect the bottom line. Yet almost nobody had solutions to offer and relatively few producers were curious about how digital could improve their financial lifeline. There seems to be the persistent and naive belief that it’s the distributor responsibility to build brands and gain market share in market. I can tell you from experience – and from conversations with executives at Southern, Republic, Glazer, Charmer and Young’s – it is not there job at all. Their job is to find placement opportunities for brands that have already been built by producers.
This is where the enormous potential of digital engagement across all tiers comes into play. We are in the midst of a fundamental transformation in how we communicate. This transformation is about: 1) “people” and the ways we get aligned around brand promises to build brand equity; and 2) “21st century platforms” that we leverage to gain that alignment and build that brand equity. Groove has been focused on the “people and platforms” required to gain alignment, drive sales and increase brand equity for the better part of a decade. It requires a consistent brand message and relevant related assets delivered on-demand to the people who need it, at the time they need it (“the moment of the sale”) and in the format that works for that particular selling scenario – be it a distributor rep doing an on-premise four glass tasting, chasing a store manager down the frozen food aisle, wait staff with customers at a fine dining establishment or tasting room staff on your property. It also requires a delivery platform that allows single sign-on, authentication, permission-based access to content and assets, and real analytics/reporting to understand what messaging is working to generate the highest sales volume.
There are many ways for producers to join the transformation – from basic asset management to the full deployment of a Wingman type platform. You need to determine what’s best for your organization based on your technology and marketing agenda. While the transformation clearly has enormous consumer potential for everyone in the industry, producers should not overlook three-tier commercial digital engagement. It’s the low hanging fruit for incredible digital ROI.