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Why Wine Clubs are Flawed DTC Marketing

Traditional winery marketing thinking is that Wine Clubs are it. They should be the center of your marketing efforts.

However I have a problem with relying on Wine Clubs. I think they are given far more weight than their worth. Wine Clubs are just another direct channels with all sorts of problems.

The argument for Wine Clubs goes a bit like this

mastercardvisaamexThey are a regular income stream, every year, from your customer fans. They give you their credit card details and agree to a future shipment often in exchange for access to discounts and perhaps an allocation of limited wine product. It is taken a bit further in that it is said that if you have a tasting room you should have be pushing people to sign up to your wine club as a KPI. In short every year I have a huge increase in stock that you need to get rid of. Sometimes you can only ship that stock outside of extreme weather. So Wine Clubs are ideal.

But wait, what about the Wine Consumer

The wine consumer meanwhile usually doesn’t have a big cellar (of course some do, the whales of the wine industry), they are likely to drink wine reasonably soon after receiving it and like to explore different brands. They may have some favorites XYZ Pinot Noir or ABC Chardonnay and will stock them but are uncomfortable with having to buy white wine as part of the Club conditions or red, or sweet or buttery or oaked…

They have particular occasions and holidays when they want wines: Christmas, Thanksgiving, Labor Day…white in the hottest part of summer, red in the coldest part of winter.

They arrive in the The Tasting Room

They are on a wine exploration trip, tasting one flight of wine after another. And they’re given a chance to buy a (half) case of wine for 20% off if they sign up to the wine club. They are in the mood, happy, generous, great tasting room staff, the weather’s great, life is good. You get it. They go home with their case and drink it over the following weeks.

12 months later

Another case of wine arrives from the long forgotten wine tasting tour. It comes after work on a cold wet day. They’ve just paid all their bills and didn’t count on yet another one. A long weekend is weeks away, they have no special occasions coming up, it’s turning winter and they just got 6 white wines when they wanted red. Not happy — but not angry, it is wine after all!, they go online and cancel their membership.

The average number of months for Wine Club Membership is 28 months. That’s one delivery a year later and one more if you’re lucky. That’s it, on average.

How about this way

You map out when the wine consumer wants wine — those regular periods of heavy sales. Holidays and long weekends. You find out when their birthday is. You work out if their town is hot hot or cold cold. You find out what varietals they want. Then based on that calendar and personal preference you send them wine they want when they want it. Using special software…

Called email marketing

Okay not so special, but professional like MailChimp. Email Marketing done the right way, segmented based on customer preferences and holidays, with most emails most of the time not pushing sales but providing entertaining, informative or educational information, will result in a much better relationship with your customer.

Turn it around. It is not what is good for you, but what is good for the customer.

What’s your thoughts?
(Quick thanks to Rob McMillan for stimulating this post, check out his excellent blog SVB on Wine, though I’m not sure he’d agree with the above ;))

Images courtesy of: Christmas Decoration

Comments

  1. johanhburger says:

    Lot of truth. Taking myself as an example, you join the wine club, only to be irritated when that unexpected box arrives, mostly at an inappropriate time! Kind of creates more bad feelings than any good feelings when you do want it.

    • BruceMcGechan says:

      Thanks for your comment Johan. The other thing I’m seeing is hard-sell Telemarketing. One winery I talked to the other day makes three calls per annum with one of them not selling anything, just thanking them for their business.

  2. Sebastien Tremblay says:

    Hi Bruce,

    What an interesting topic. We have been doing work with wineries up here (given you’re in NZ!) and have come to toughly the same conclusions. Lucky, we are “socially conscious code cutters” and have now decided to take the bull by the horns and build a piece of software to help!

    With this in mind, any chances I could trouble you for a 15-20 minutes chat to bounce a few ideas with you? Skype, Google hangout?

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