Hard to believe direct/indirect wine related revenues almost doubled in 5 years. Profitability for small producers certainly hasn’t. What am I missing here? I think percent of total increases due to Direct to C0nsumer is understandable. Byron Dooley’s comments about his strategy and results are a testament. I’m sure we’ll be hearing more about this from all wine corners in Oregon. Here’s the article:
This Ship Compliant Study and Napa Valley article keep coming up in conversation with other consultants and clients, so it’s time to comment, and yes I know the sales increases are for larger Napa Valley wineries, but wine bottles like everything else roll downhill. That is to say the best practices and strategies of the large wineries and success of their DTC programs point the way to our small producers here in Oregon, and validate taking Winery Direct to Consumer to the next level. Here’s the story:
Here is an important article from Steve Heimoff for small production wineries to consider: http://www.steveheimoff.com/index.php/2011/05/26/dtc-sales-help-wineries-rebound-study-suggests/
My comments were:
Great conversation folks. It seems to me that a balanced channels approach makes the most sense, including distribution, retail and DTC. Having a strong DTC marketing program is not optional for small producers that must move product and build their brand, and as such I agree with Steve’s comments about DTC margins. Only a few cultish and well established wineries here in Oregon can survive selling FOB and wholesale only. That said, growing DTC revenue is a slow burn and requires advance planning and creativity, which many small wineries have yet to do.
How refreshing to see new management identifying the importance of ‘Winery to Consumer’ sales. Thank you to The Oregonian for publishing this story on 5/15/2011. In addition to Jeannette Morgan, Oregon Wine Board just hired Charles Humble, the new Director of Marketing and Communications. I was at a recent TRMN meeting at Kelty Estate B&B in Lafayette. Charles had a chance to introduce himself after three days on the job. He discussed the importance of small producers in the Oregon wine industry, and the renewed marketing focus at OWB going forward. I talked to Charles afterward and he said “I’ve died and gone to heaven. Working is one thing, but working in an area where you have great passion is another”. We’re looking forward to great things from both Jeanette and Charles. Here’s the article: http://www.oregonlive.com/wine/index.ssf/2011/05/tech_industry_veteran_jeanette.html
May started off with beautiful weather and lots of consumer wine events. In the rush of doing so many things year-round, it’s important for wineries to remember event best practices. Let’s start with the 3 reasons we do onsite and offsite events: Sell wine, Sell club memberships, Secure new emails. Are you comfortable asking consumers to purchase? Let’s be certain your associates are too. How about justifying the wine club commitment? How is yours different? Take ‘the teeth’ out of your wine club applications, and make it easy and fun for consumers to join you. How about securing emails? Are you still using a lined pad? Since real estate on tables provided by events is shrinking (I’m now seeing wineries share 8 foot tables), go to a simple 4”X6” tear off pad format to capture: Names, Email address and “How did you hear about us?”. The last piece of information helps you track back to referral sources and media effectiveness. It also alerts you to what winery stories to tell, and what promotional info to provide your audience when you invite them to visit your tasting room, the ultimate reason we do these events in the first place.
In a 1/25/2011 Oregonian article, Dana Tims does a nice job of summing up the state of Oregon Wine sales last year, and reality of the importance of establishing deep ties with consumer.