Back to Basics

Picaboo Street“When someone tells me there is only one way to do things, it always lights a fire under my butt. My instant reaction is, I’m gonna prove you wrong.” … Picabo Street

Yes, it’s tough out there, maybe tougher than anytime since the immediate post 9/11/2001 period for wine sales. The wine brand market place is saturated, with little or no room for additional undifferentiated brands. The rate of distributor consolidations has increased squeezing out the small winery brand. On-premises national accountNielsens are becoming an even more significant part of current broad market wine sales. There is an increasingly rapid consolidation of the grocery sector, constricting the funnel from winery to shelf placement. And, now the Nielsen Company, in their May 13, 2009 US Wine Consumer Report informs us that even though wine in general is ‘recession-resilient’ the US wine consumer has an economic hangover resulting in restrained spending.

US Wine Market GrowthThe domestic wine market, while featuring new points of price sensitivity and significant channel shifts, is still growing, albeit at a slower but perhaps more rational rate. Is the market growing for your brand? If not, maybe you should revisit some of the basics of marketing best practices. It will also help to have an understanding that the actions that you take today and tomorrow, will help to position your winery to ride upward with the recovery.

project-genomeDevelop a deep understanding of the various to market models available to you as a wine marketer:  the Three Tier System, DTT, and/or DTC. Gain a thorough knowledge of the role of ‘Marketing Agents,’ third party marketers of your wine such as The Wine Spies, Woot Wine, winecliQ, and soon Amazon, Sears and Borders Books, plus a panoply of independent wine clubs.

Hire and retain talent. Find people who share your vision, and have the ability and desire to articulate this to the market. Identify individuals who view innovation as a key strategy. It seems to be an important concept in this phase of the business cycle to have experienced leaders who have previously weathered the inevitable exigencies of  business ups and downs.

Run a flat organization. Create an environment of opportunity. Stress collaboration over hierarchy, and value and reward individuals based on their contributions. And, remember the golden rule of management, to praise in public, and to discipline in private.

Steve JobsRecognize that in recession it’s time as Steve Jobs of Apple once said to, ‘Think Different’. Apple was born in the energy crisis of the late 70’s. The early 1980‘s were a time of great innovation. Glen Ellen and ‘fighting varietals’, Kendall-Jackson’s category leading Vintners Reserve Chardonnay, and Corbett Canyon 1 Ltr varietals from Santa BarbarBadit Tetra Pack Winesa County all debuted in a climate of 22% interest rates and base mortgage rates of 17%. The early 90‘s brought about $2 Buck Chuck, Tetra Packs, Screw Caps, and Cult Cabernets. There has been a continual evolution of the wine market from deserts, to light sweet whites, to the era of jug wine, through the shift to varietals. The current cover of Beverage Industry Magazine features a story about packaging innovation, proclaiming a new ‘French Revolution, Boisset Family Estates pushes the boundaries of wine perception.’

permission marketingPay attention to cultural and market dynamics. In this age of permission marketing, use all of the great social media tools to engage your friends, fans, customers and clients. Get online and in tune with social networking through Twitter and Facebook. Make sure that all of your print trade information is accessible through your web site, such as labels, product information sheets, sell sheets, press releases,file:///Users/johnncorcoran/Desktop/images.jpegacclaim, etc. Put your press kits on USB flash drives. USB drives are green, they can be recycled, the end user decides what’s important to print saving a tree or two, and the reduction in print cost can be significant.

wine tastingsGet on the road and shake hands. No one can tell your story with more authenticity than you can. Do a lunch with market movers each day. If you’re in the market for 2 days, make the first lunch with 10 accounts who don’t buy your wines, the second day can be the thank you lunch for your best in-marketDavid Cole accounts. Get on the phone and talk to your customers. I saw this on Twitter 2 days ago from David Cole of James David Cellars “Surprised a few customers today when I called to thank them for their online orders. Love talking with customers!”

Jay Conrad LevinsonBecome as Jay Conrad Levinson counsels a ‘Guerrilla Marketer.’ Drive your DTC business by innovative marketing. Taste and interact with college alum groups. Do luncheon tastings for faculty groups, i.e., the Stanford faculty tasting. Set-up tasting lunches in large brokerage offices. Do tech company events. The following email announcement is a great example of a must do wine tech event hosted by Smoke Wallin, founder of Wine 2.0:

Subject: Announcement from Wine 2.0 – the second, exclusive, Wine 2.0 Reserve @ Google Event

500-600 Google professionals will attend. Very Casual/Relaxed, Outdoor on theJ. Smoke Wallin patio of the Cafe on Campus
. When: June 19th, 2009, 
Times: 4:00 – 6:30. 
Cost: $325 per winery to pour. 

Winery must be signed up on Winetwo.net to register. Wineries must register who will pour for them in advance.

 Limited to first 25 wineries. RSVP to join us or with inquiries to clay@winetwo.com

Invest in research tools, and get to know your market. For wines in broad market distribution, whether in a three tier model or a DTT model, wine market intelligence is key to decisions regarding your channel strategy, pricing tactics, and distribution model. Marketing intelligence isn’t just for the mid and large sized wineries. It may be as important to the 5,000 to 25,000 case producer, where these decisions are key to surviving and thriving in today’s congestion. All classes of CPGs utilize market intelligence, and there are specific products and companies that provide information to the wine industry.

IRI provides transactional web based data reports for wineries in chain beverage, or in US Food and Drug retail markets, utilizing empowering technology to focus on market performance and brand building

TradePulse provides comprehensive sales, distribution and inventory management services, critical information for managing your sales model.

Nielsen Retail Scan Data provides a robust reporting engine on current transactional data from the retail chain marketplace. Provides information on what are you selling and where are you selling. This is important as a tool for checking your strongest and your weakest markets.

WINEDATA Pricing Report is a source of competitive supplier pricing. This is important in helping to determine your brand and/or varietal competitive frame, and for tracking pricing tactics and promotional activity within this frame.

Christian MillerFull Glass Research is an independent firm providing primary wine industry marketing research operated by Christian Miller. This firm helps you choose the right methodology for your budget, by separating the nice to know issues from the important to know issues. A key component to understanding market dynamics necessary to making those important decisions.

MKF Research, founded by Vic Motto, is now headed by Christian Hill, and is a division of Frank Rimerman, Co LLP. MKF Research has done primary market studies on varietal and category pricing, ranking markets by varietal, and tracking pricing segment shift patterns. This is an aid in determining your market distribution model.

Joe MontanaHopefully your goal in the wine business is to build market value. This is your passion. You do this because you must. Really, because it’s nose to the grindstone time. Basically you need to work harder and smarter than your competitors. It is not the time to cut back on core business resource allocations, either human or capital. Use these resources to identify and fill distribution voids. And, remember to pay attention to the basics.

Note: Copyright © 2009 Think Wine Marketing® All rights reserved.

Networking Matters More Than Ever

Oscar Wilde“There is only one thing in life worse than being talked about, and that’s not being talked about.” … Oscar Wilde

In a modern computer centric world our Rolodexes have for the most part been replaced by CRMs. We’re wired and connected through our desktops, laptops,Rolodex netbooks and smart phones. We tend to ping each other rather than talk to each other, through connections on Linkedin, Facebook, FriendFeed and Twitter. How we identify and track our networks has changed, however it is still clear that the power inherent in networking has never been more important than in today’s product saturated wine market.

This week I received an e-mail from a dedicated reader in my blog network who made the following observation on contemporary interpersonal communications: “With all the focus Screaming Eagle Labelon social networking, I’m worried that the signal gets lost in the noise…So much noise that the point of social networking – building relationships – can get lost. Especially if you’re trying to sell high-end wine, you need deep relationships with consumers, not ones created in 140 characters or less. Facebook will never replace face-to-face meetings, lunches, interview, etc. It can augment, but not replace.”

Dear Reader:

The specific idea behind my blog was an attempt to raise the level of discourse concerning the field of contemporary wine biz marketing issues, and the concomitant desire to create a dialog with my readers. Part of this contemporary marketing landscape is the need for the effective application of e-marketing skills as applied to our complex, saturated corner of the CPG category. Of course there are often no real solutions in a single microblog post people talkingexpressed in a 140 characters. But perhaps there are answers and solutions in the resulting conversation. Effective wine marketing is a series of integrated actions leading to planned outcomes, trackable through specific metrics. Social media is a brand awareness tool that works only in concert with effective implementation of channel strategies, field brand execution, promotions, pricing, etc. Murphy-Goode’s current promo would be inauthentic, and ineffective if they didn’t have their brand house and e-house in order, and a fully developed network of guests, customers, clients and fans. Murphy-Goode is effectively reaching out to existing and new customers, creating additional brand touchpoints.

In an attempt to clarify the role of Social Media on improved brand performance, please note an observation from Pahlmeyer Chardonnaymy experience and noted marketing research in that wine consumers have a limited # of brands, or varietals in their preference set(s). Any mentions from good print reviews, to a product placement in a Demi Moore movie, or a write up by Alder Yarrow in the Vinography wine blog will tend to place one’s brand on the tip of the consumer’s tongue, and tend to predispose and shape  consumer  purchase activity, the goal of any cogent marketer. Also, winery sales management need compelling reasons to communicatNoisee to their distributor partners, gatekeepers and consumers. If a certain number of mentions, perceived as noise, predisposes a positive response from the audience, all to the good. The conversational noise of the Social Net can be be filtered into viable wine marketing buzz with the use of the Social Media aggregation and syndication tools from Cruvee.com. So, yes the Social Media digital handshake augments, supports, and sometimes drives commerce as a new part of old school wine industry networking best practices.

My blog is 1 of approximately 4 million existing weblogs that are written in total and 1 of about 250+ wine marketing blogs. My readership is targeted to a specific niche market, the emerging tech sector of wine marketing, i.e., CellarTracker, VinTank, Cruvee, AbleGrape, etc., also including the winery brand management, marketing research, consumer insights, anacademic analysisd strategic planning arenas. To limit my discussions to just deep academic analysis and thought, would perhaps limit readership, and in turn limit an understanding of the Social Media e-tools now available. But, please don’t confuse brevity with lack of thought or insight. Although reports like the foundation VinTank Social Media White Paper, are perhaps more important in moving the awareness needle forward, the bloggersphere performs a key wine business communication function . I’ll concede that many blogs are personal journals, quickly written, or restatements of news feeds, and that some may disappear without reader remorse. But perhaps blogs are like Thomas Paine’s Common Sense pamphlets, Red Meat issues meant to stir the pot, with some postings leading to a positive, meaningful discourse that moves the conversation forward.

Wine NetworkingAlthough I’ve focused my blog on wine business Social Media issues, hopefully I’ve done so with the POV of pragmatic integration. My goal has been to move at least one person to be a better wine marketer.  I don’t have all the answers, just a part in the real world approach to contemporary wine marketing that works. Marketing that works because it includes talking to and more importantly listening to our customers. Yes networking matters more than ever because we’ve now included the end user as a focus of that network. And, while our handshakes are now often digital, they hopefully convey the modern wine marketer’s intent to form meaningful, nurturing adjunct relationships in the new wine marketplace.

Note: Copyright © 2009 Think Wine Marketing® All rights reserved.

In a Wine 2.0 World It’s All About the Conversation

images-1“It was impossible to get a conversation going, everybody was talking too much”
… Yogi Berra

It is my experience that the best time to innovate is in time of crisis. Business historically exhibits up cycles and down cycles. Right now, we’re either in a bounce, or the cycle has started a long slow trudge out of the financial abyss. It is evident that case good supplies are tightening, as wineries winnow down inventories of their ’06’s and ’07’s. Our wine distributor partners are ordering via the Dell Computer model of just in time. Restaurants that were case buyers have become bottle buyers, and retailers have reverted to post millennium stock reduction strategies. At this point, the wine market is forecasted to continue growing, albeit at a slower rate.

A quick review of a recent down point in the economic life of North America, reflects that crisis and necessity are the mothers of invention. 9/11/2001 had a significant short termimages-2 affect on wine consumption. At the time wine inventories in all channels were inflated, and recent vintages had been panned in the press. Fred Franzia and ‘Two Buck Chuck’ came along to absorb the juice at the value end of the market, and the series of vintages over the next six years received significant acclaim from print critics in the know, cementing the category we have come to know as ‘cult Sidewayswines’. The buddy wine film Sideways was released, and demand for Pinot Noir wines shot through the store roof. Prices for wines of all categories above $5 a bottle increased as a result of market dynamics, with the strongest growth in the segment of wines above $15 bottle. For a full review of the economy’s relationship to wine sales in the last 25 years, please read Vic Motto’s article ‘Wine in a Downturn’ in the Global Wine Partners January 2009 newletter, VinSights.

Several factors have mitigated the effects of the global banking crisis on the growth in overall domestic wine sales. The pool of wine consumers in the US has grown by 25 million in millennial selecting wine at Safewaythe last six years as  millennials have adopted wine as their beverage of choice. The relatively cheap dollar in relation to other currencies and drought in Australia have diminished market share for most categories of import wines with the exception of Spanish wines. Smaller recenttapas  bar and Spanish wine domestic wine grape crops related to demand, and a wine industry tuned into the consumer sales cycle, have case goods inventories in balance, or in some pricing and varietal segments short, softening downward pressures on wine pricing. This even as we experience channel consolidation and shifts in consumer purchasing patterns.

Given the law of unintended outcomes, a new way of communicating brand has occurred as well. Computer work station, laptops, netbooks, and smart phones, as exemplified by the Cork's iPhoneiPhone and Blackberry, are now ubiquitous. This generation of new wine drinkers is indeed the personal computer generation. Communication has evolved from the desktop to a more portable format. What started out on AOL as instant messaging, moved to Yahoo and MSN, continuing the migration through MySpace to Facebook and now Twitter and FriendFeed. Texting and IMs have morphed to become micro blogging as a way for friends, communities and businesses to communicate. It is now all about the conversation.

The mindset around social media is it’s all about having a conversation with your friends and not about advertising to an audience. As Jeff Stai, at Twisted Oak has often stated, ‘it’s the modern equivalent of the office water cooler conversation.‘ Sorry, Don Draper, the Mad John Hamm as Don Drapper, Mad menMen model has peaked and, like Sisyphus’ rock, is rolling downhill. Understandably navigating this new multi platform brand awareness strategy can be intimidating and challenging, and the utilization of unique tactics  for different touch points can be daunting. Wineries need to develop a set of targeted tactics for each platform such as podcasting, You Tube, blogging, Twitter, Facebook and Linkedin, while including traditional media in the mix in an effort to create brand awareness. It is important to note that this takestwitter commitment, and managers who aren’t just digital savvy, but who understand that the dissemination of key communication points is now a complex exercise. It may also take the insight that maybe it’s more important to listen than to talk. Today’s consumers choose with and to whom they engage. The current key marketing question is not how do I manage my social media relationships, but rather it’s how do I nurture them.

a really Goode jobLets take a quick look at the Murphy-Goode’s promotion ‘A Really Goode Job’. Their print ad reads – “Wine Country Lifestyle Correspondent. $10,000/mo (6-month contract), wine country housing included for a good communicator who is Web 2.0 fluent..blogger, videographer, tweeter..excellent written and verbal skills, engaging presence, at least 21-years old, wine lover”. The folks at Murphy-Goode, have established solid broad market distribution. They’re utilizing print, website and social media platforms to tell a fun story. Their have their ducks in a row. Prior to the start of this social media campaign there wasn’t much of a digital conversation going abouA Really Goode Job Annoucementt Murphy-Goode. Now if you check-out Twitter search for ‘Murphy-Goode’ or ‘A Really Goode Job’ you’ll be able to observe all the buzz that this promo has developed. And that’s just Twitter. If you check out the freemium search feature at Cruvee, you’ll see that the conversation about Murphy-Goode has elevated above the din in a noisy, brand saturated marketplace.

question-mark.jpgHow does your winery compare? What are you doing to innovate, and create brand buzz? Are you engaging in the conversation? The Murphy-Goode program has legs. Publicity and brand awareness will follow the selection of the successful candidate. The stories, videos, blogs and conversations generated by the new Murphy-Goode ‘Wine Country Lifestyle Correspondent’ will continue to engage customers and fans. As soon as you go on the Murphy-Goode web site and vote for your favorite candidate, take time to think about your digital media strategy, and how your winery will engage customers. clients and fans in the conversation.

Note: Copyright © 2009 Think Wine Marketing® All rights reserved.

Wine 2.0 Strategies for Maximizing Distributor Work-Withs

womens final Martina Navratilova“Just go out there and do what you’ve got to do”
… Martina Navratilova

An analysis of the US wine industry today, reveals that the meteoric growth rates across all pricing segments above $5/btl of the last 7 years has significantly slowed. The word emanating from those in the know has been that ‘if your sales are flat, you’re up’. Not words that are of comfort to your CFO, or ones capable of instilling confidence in your angel investorstateofthewine200jpg2s. On Monday, May 4th, Silicon Valley Bank Financial Group released their annual ‘State of the Wine Industry’ 2009-2010 report by Founder Rob McMillan and Division Manager Bill Stevens . While the tone of the SVB  annual report was sufficiently dour, reflecting the immediate past and the current liquidity crisis facing many wineries, a tone of optimism was revealed in the on-point recommendations for marketing and selling wine utilizing the internet and social networking tools.

chart1Looking at the Dow Jones index, and noting anecdotal observations from key retailers, restauranteurs, winery national account managers and my time on the streets, it seems as though the bottom has been struck, and we’re in the early days of a long recovery. The stock market hit bottom on March 9th and in a series of bounces is trendingMorton's Steakhouse higher. An inside source at Morton’s confirmed that customer counts and guest check rings have recovered to pre-August 2008 averages. Conversations with retailers in major metro markets revel that although the first quarter was soft, the availability of wines once only sold on-premises have helped to energize sales in Q2 . My winery national account sources have noted that requests for submissions of Sales Presentationbetter wines has increased in the last 3 weeks. If your channel model includes your active participation in the three-tier system, these are all signs for optimism. But, to turn optimism into results you should be prepared to get out of your office and spend time on the streets working with your distributor partners. So, are you in position to take advantage of this upturn, or are you waiting for the market to come back to you? Yesterday, in reply to an extended lunch invitation, I received this text message from a winemaker/owner: “Thanks, John – working in the Texas market at the moment. Chicago last week. AZ and St. Louis before, earlier this month. Feeling like a sales & marketing guy.” If this isn’t you, it should be.

Cakebread CellarsMy first experience with a real work-with, happened just a few months after returning from Europe. The niche Florida distributor that was my first post grad school employer was soon acquired by National Distributing, and I was given the job as wine manager for the Orlando office. NDC had just started to represent Cakebread Cellars in the Florida market. Central Florida was the home to Walt Disney World, my pre-grad school employer, and the location of super heated hotel and restaurant development. In a series of faxes thatOakville Grocery went back and forth between Oakville and OrlandoJack Cakebread, the founder, noted that he wanted to call on key on-premise accounts only, including Disney, based on the list that he had provided. Once I had scheduled the stops, Jack called and confirmed each appointment before heading East from California. At the time, I thought that this was a bit over the top. However, it was a successful trip for Jack and for Cakebread Cellars. We sold every account, in part thanks to Jack pre-qualifying each account. I learned my work-with lesson well that week of identifying, qualifying and closing key lighthouse accounts.

Jack CakebreadJack Cakebread’s methods still work today. Targeting key accounts, planning your calls and executing/closing still matters. But, today we have so many more tools at hand to maximize our distributor work-withs. Distributor and market consolidation have taken leverage away from all but the largest suppliers. We are in the midst of an accelerated round of supplier andJean Arnold Sessions wholesaler mergers. Jean Arnold Sessions is correct in her assessment that for a winery to be successful today one needs to spend available time and effort in managing the market, rather than managing one’s wholesaler. Oh, though it is important to work with and through your distributor who’s primary job is to sell service and deliver your product within their assigned market. Your distributor manager will request, require and appreciate your efforts.

The organization of your market trips and work-withs needs to start with a plan that articulates specific, reachable objectives. Start by organizing your CRM program to target, track and follow-up with each market work-with account. Market knowledge is a necessity. But, if you’re going to a market that’s new to you, research, research, research. Set targets by channel and account. Call each account and identify with whom you need to meet, and then qualify the account. If you’re selling Mendocino Single Vineyard Pinot Noir, and one of the restaurants that you’ve targeted only sells small production Piedmonte wines, well take them off your list. Communicate to and confirm with your distributor partner by email and telephone just what you are doing.

Before departing for the market post a summary of your travel plans on your Facebook Fan Page, and contact bloggers and tweeters to let them know that you’re coming to their market and would HdR Tweet-uplike to arrange one-on one tastings, or a tweet-up.  If I were to sell wine in Denver, the first person I would call would be Rick Bakas, blogger and tweet-master. As you work the market, find out if your new Chris Donatiellocontacts are on Facebook or Twitter. Get their social network info and add them to your CRM. As you achieve success through product placements, such as WBTG for June, tweet it. Link your tweets to your Facebook page. Success follows success. Include pictures of your accounts, and your contacts. This is not only good will, but it will inform your local followers, who in-turn will tend to support this restaurant placement. All of this is happening in real time, and, not as in the past, weeks later in a follow-up letter. Chris Donatiello does this and has created a buy-in for the C.Donatiello Winery by posting updates and keeping his friends and fans invested and engaged as they follow his market travels.

Restaurant Line-up TastingAs the day progresses, arrange to do 1 tasting per day at a key line-up for all new or existing placements. Instead of just one salesperson selling the wine, you’ve now informed and created 10-12 new sales people. Once again using your CRM, exchange social networking information with the crew at the restaurant. By inviting them to follow your updates on your social networking sites, you’ll keep them involved and keep them selling your wines. In an effort to increase your viral reach, ask the just sampled staff who have actual experience with your wine to post reviews on sites, such as CellarTracker, AbleGrape, vinquire, or VinCellar. This isn’t the Chicago politics of my youth, but a request for honest appraisals of your wine by informed wine consumers to be posted on sites frequented by other inquisitive wine consumers.

When you return home, post the story of your trip on your winery blog.  Summarize yourChecking Accounts Sold achievements in an email to your distributor/partner. Hand write the requisite thank you notes. Download information from your CRM contacts list. Add and follow your growing list of contacts to your social web. Then read in detail and in real time the appropriate account sold reports, which you’ve of course retrieved  online in the form of a CVS file directly from your distributor partner’s data server.

Note: Copyright © 2009 Think Wine Marketing® All rights reserved.