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September 13, 2007 | Customer Relationship Management (CRM), eCommerce , Wine Industry Trends | WineDirect Admin

Why we buy wine on-line

A look at the pro’s and con’s of buying wine on-line

A recent study by the Wine Market Council claims that 20% of core wine drinkers purchased wine online in 2006. What is driving this? There are a number of good reasons to purchase on-line.

  1. Selection – There are 5,600 wineries in the U.S. Most of them can’t get distribution in markets outside of their home geography. As the laws for shipping wine across state boundaries have loosened, it is now possible to gain access to many of these wines from a home computer. The consumer can order direct from the winery, or from websites that feature wines from small hard to find wineries. Some sites of this type are appelationamericas.com, mywinesdirect.com, and Winesource.com. There are other popular sites that don’t specialize in hard to find wines, but do offer a broad selection. Wine.com and K&L wines are the two most popular.
  2. Gift Giving – A consumer cannot legally send wine through the mail, or through a delivery service, to another consumer. However, if you order on line, the seller can ship direct to the gift recipient. Most of the on-line sellers will include a gift card if you ask.
  3. Personalization – Wine is a great marketing tool, as well as a unique gift. There are on-line wine sellers that allow the consumer to add an image and/or a message to a bottle of wine. Often these wines are purchased to commemorate a special occasion, ie. Weddings, birthdays, etc, or as a marketing tool. Realtors frequently use bottles of wine with a picture of the house they sold, and the realtors name, as a closing gift to a buyer they represented. Some sites to visit are; http://Windsorvineyards.com, http://www.Signaturewines.com, and http://Winesource.com.

While there are good reasons to try an on-line purchase, there are some pitfalls.

  1. Shipping cost - The number one barrier to on-line sales. A consumer needs to be careful here, as these costs add up quickly, especially on one or two bottle purchases. Along with the actual shipping cost there might also be handling fees or packaging fees. Additionally, FedEx, UPS, and DHL impose a Signature Required fee. They say this is to offset their cost of making sure someone is there to sign for the package.
  2. Weather conditions – Watch out for shipping wine when it is very cold, or very hot. Wine that you purchase from a retailer in your local market, was probably shipped in refridgerated or heated trucks when necessary, then stored in a climate controlled warehouse. FedEx, UPS, et al do not use these types of trucks. What ever they ship will be exposed to the temperatures inside the vehicle. Many wineries will not ship if they think the conditions will damage the wine. One trick is to order wine for shipment on a Monday or Tuesday, so that you will receive it before the weekend. In times of more extreme weather, you don’t want your wine sitting in a warehouse over the weekend.
     

So how does a winery take advantage of the trend, and overcome the obstacles? Some suggestions:

  1. Offer special bottling only on your website, letting your mailing list know of their availability, and limited quantity.
  2. Capitalize on gift giving. Offer gift packs. Have the ability to add gift messages with a purchase. Launch e-mail campaigns reminding consumers of gift giving opportunities.
  3. Be careful with what you charge for shipping. Look at these costs as part of your overall cost of goods. Is there enough margin in the wine to offer free shipping? Not all the time, but as a promotion. If not free, can you offer discounted shipping.
  4. Can you offer personalization? Not easy to do, but many wineries have figured out a way to offer some simple solutions.

Bottom line is that there is an ever growing group of consumers looking to buy on-line. With thoughtful planning you can position yourself to get your fair share of the pie.

 

 

 

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