10 years of Winery Consulting – What I learned

A Wine Marketing & PR Perspective

I was asked recently how I got started in the wine business. My experience is not unlike many small producers who transitioned from other business lives, learned on the job, but had the determination necessary to be successful. I am fortunate and appreciative to have worked with over 50 wineries in some capacity, initially as a DTC marketing consultant and starting in 2012 as winery publicist.

Marking 10 years doing anything is milestone, especially in the wine business given the pace of change we’ve seen. Wineries continue to recreate themselves by embracing marketing best practices and technology innovations. The pace of change has picked up with no end in sight. The one constant we can all bank on are relationships. If you’re a publicist, it’s the relationships you develop over a long period of time with writers, media outlets, winery and travel associations and occasionally with other publicists and marketers. If you’re a winery, relationships that matter most are with your customers, staff, wholesalers, other service providers, and the wine community. Going forward I’m guessing that people will continue to matter most, followed by product and wrapped in good marketing and brand promotion. Here are some general observations related to small production wineries in Oregon, over the past 10 years.

2009 – The way things were

• DTC marketing – a relatively new channel for small producers with little distribution. Focus on tasting room openings and wine clubs, starting mailing lists, email marketing and social media
• We’re farmers – most common response to queries about marketing plans
• Marketing plans and consulting services – those were for real businesses! And, we used to sell out in past years!
• Paid Content – print advertising is still widely used for winery promotions
• Wine clubs – not as prevalent – 70% had some form, many needing revision
• Websites – many wineries upgrade to WordPress and other content self-management systems
• Social media was a new thing – common responses included – It’s not for us. Do I need to do this?
• Holiday weekend sales were legendary – reports of $15,000-$20,000 weekends were common
• Staffing – Few hospitality managers and very few digital marketing managers
• Brand Building – relied on distributors. Distribution mix to DTC was 80% to 20%
• Distribution consolidation – started with 2008-2010 recession. Small Wineries phased out of markets. Focus turns to smaller cities and regional markets. Much effort expended on market trips
• Wine quality – still varies by producer. Collaboration on techniques is improving uneven quality
• Media Coverage – wineries are occasionally being discovered. Active media outreach is minimal
• Great recession ceases in 2010-2011. U.S. stock markets reach record high. Confidence, optimism and new investment returns

2012 to 2018 – It’s getting competitive

• Owned Content – wineries focus on updated websites, blogs, social media, news, photos, videos and designed collateral
• Regional, AVA and Tourism Associations – emerge as marketing organizations with enhanced budgets from new member dues, grant funding, fundraising
• Experiential marketing – became a thing around 2015, which leads to hiring of hospitality, tasting room and club managers as the new standard in tasting room staffing. Multiple “experiences” offered
• Winery specific software – facilitates target marketing and customer relationship management. Development of applications and technology create opportunities for hospitality staff to customize customer experience and interactions. Website analytics allows tracking of activities and results
• Competition – new vineyard planting and winery brands proliferate due to factors including changing weather, quality and integrity reputation, and significant outside investment
• Channel Mix – is evolving to 20% Distribution and 80% DTC
• Wine quality – quality is a “point of entry” for consumer sales, and is widely accepted due to production experience, collaboration & technical advances
• Media Coverage – wineries recognize the need to stand out in a crowded marketplace, and recognize brand building as their responsibility, although take a passive approach to promoting themselves. Winery associations offer members exposure to media activities, contacts and inquiries.

2019 until?

• Branded versus Grower-Producer – the influence of winemaker personalities will diminish as well-funded large wine groups out-spend, out-price, and out-market small brands
• Consumer visitation – becomes longer and more focused. Extended visits equate to less tasting room traffic, as people stay longer, visit fewer wineries but have higher quality experiences. Conversion rates increase, although less traffic equates to fewer opportunities for club sign-ups and new digital subscribers
• Wine Club Retention – remains as issue as consumer have much choice and are gaming the system. Loss prevention becomes strategic for DTC management
• Online Sales – this DTC sales channel has much underrealized potential. More wineries will activate eCommerce programs as an additional revenue source, and to manage customer contacts, interests, transactions and history. The overall customer relationship will be highly managed
• Staffing – scarcity of trained and qualified staff is an issue, whether within the wine industry or hospitality industry. This calls out the need for sales automation and technology investment
• Digital Marketing – 2019 and beyond will see the hiring of digital marketing managers as the most important role, in coordinating all marketing functions with a focus and emphasis on e-commerce.
• Media Coverage – the need to develop “Top of Mind” awareness becomes apparent. Wineries will begin to add communications professionals to staff, at least in a part time role. Active media outreach and brand promotion campaigns will be coordinated with digital marketing staff
• Channel Mix – some producers give up on distribution and moved to 100% DTC

These are halcyon days for the wine business. Who knows what the next economic cycle will bring? Consumers have disposable income and purchases of $80-$100 bottles are not uncommon. Update and invest in your business now, while the going is exceptionally good.