This past month, BlackSquare co-founder David Gluzman travelled to Napa Valley to get a taste of the U.S. e-commerce market at the Wine Industry Technology Symposium (WITS). Through this two-day conference and visits to various wineries in the famous region, David saw how open the Napa region is to DTC sales and even more, how Blackboxx fits right in.

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BlackSquare’s experiences with travel to different wine regions have taught the team the importance of building your product brand as a winery owner. This message was overwhelming at WITS and directly in Napa Valley, with the added necessity of providing customers with an incredible and memorable experience.

Top industry leaders attended the conference from July 15th to 16th. Seminars explained the highs and lows of wine DTC sales and exactly how to make it work.

Below are some of the best tips David collected from the WITS seminars.

 

1. Move your business to the cloud whether your business is large or small.

Many winery owners believe DTC “won’t work for [them]” In fact, it most definitely will not work if you don’t try. Wine ecommerce is expanding globally, meaning there is no denying the massive competition in the ecommerce field. However, regardless of their size, wineries are generating profit through DTC, and all wineries need to recognize the shift in consumer trends.

In “Why traditional ecommerce has failed the wine industry,” written by BlackSquare CEO, Matthew Protti, it states that 62% of U.S. wineries report that DTC is the fastest growing sales channel. [1] Additionally, while DTC sales only account for 10% of sales, they make up an average of 20% of the winery’s profit. Without making a move towards wine ecommerce, wineries are losing out on a much larger market and the chance to build their brand.

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*National Geographic. Photo by Wes Thollander

2. Show off your brand to move customers to your DTC site

BlackSquare has previously mentioned the value of social media for marketing a winery’s brand and wine, which relates to the previous point. Regardless of the size of your winery, participating in social media and marketing your name is possible. By opening the experience of your wine to networking, you are attracting visitors to your site and ecommerce store.

Tasting room experiences can also move a wine taster to wine club member by the end of their visit. With Blackboxx’s mobile responsive design feature, you can introduce clients to your wine club and have them signed up on the spot. Your step-by-step help is not only impressive customer service, but also leaves a positive outlook on your brand and experience.

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3. Operational Intelligence

Although Napa Valley and the United States are successful with DTC wine sales, existing software and shipping issues are due for modernization. United States laws and taxes result in inefficiencies for shipping wine from state to state. Most wineries use ShipCompliant, an online service designed for making wine shipping easier for U.S. wineries. Fortunately, it can also be integrated with Blackboxx. A ‘Starter’ price with ShipCompliant begins at $300 per month for up to 750 shipments.

WITS focused on how operational intelligence includes more than just having knowledgeable staff, but also stressed the importance of data management. Blackboxx software organizes every client with extreme levels of detail. With transactions broken down to highlight wine price, shipment price and tax as well as administrative comments, managing customers is simplified. Organizing wine data in Blackboxx enables categories for tasting notes, retail and club prices and inventory.

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4. Customer experience is everything

Visiting several wineries in Napa Valley truly confirmed David’s belief and WITS seminars’ message that customer experience generates the success of any winery.

By starting in the tasting room, a winery is opening its doors to potential club members and setting a standard for all future interactions. With thousands of wineries to choose from, customers need to be impressed by your brand and its unique qualities. What sets your winery, design, label and wine apart from the rest? How are you portraying this difference in the tasting room? Whether it is showing off high quality décor, or shedding light on your winery’s unique terroir and history, customers need to be amazed. Your business relies on them not only enjoying your wine, but the entire experience you provide.

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* Vancouver International Wine Festival Tasting Room 2013

BlackSquare’s internal calculations estimate that approximately 900 club members will generate around one million dollars in DTC sales. Aiming to sign one to two tasting room client per day to your wine club (varies by tasting room traffic) will result in a minimum of 300 clients per year. Therefore in theory, a million dollar wine club can be constructed within three years, given a level of tasting room commitment.

While the numbers seem intimidating, David’s Napa Valley experiences entirely support the calculations. At a particular winery, David was shown “blocks of vines that will never see retail.” The wines made from these grapes are specific to club members. After 10 years in wine ecommerce, this Napa winery has reached 4,600 club members and sales of $5.6 million.

 

BlackSquare believes that successful ecommerce starts with customer experience in the tasting room, which can be supported by industry specific software like Blackboxx. The U.S. market is a leader in DTC ecommerce wine sales and wineries around the globe need to follow that trend and use DTC more comprehensively.


[1] Reported in VinterActive – ‘U.S. Consumer Direct Wine Sales Report.’