Home Video Pandemic Forces Change in Wineries’ Wholesale Strategy 

Pandemic Forces Change in Wineries’ Wholesale Strategy 

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By Paul Vigna

Dale Stratton is the owner of Five Points Consulting, LLC, a 35-plus year veteran on the wholesale side of the wine industry who previously worked for Constellation Brands, among others, offering insights into consumer and brand research and data.

He has seen plenty, but nothing like he has seen this year with the pandemic affecting the industry national and internationally.

Dale Stratton
Dale Stratton

“I do think you have to take a step back and look at this and say, on some level, everybody has been impacted in one way or another in what they’re doing,” he said.

That was the primary backdrop for the first day of the Wine Industry Network Sales Symposium, held Sept. 2-3. The three workshops focused on the wholesale channel were attached by a similar thread: How has the pandemic changed business and how can wineries adapt to those changes.

Stratton and Jake Hegeman, the VP of Legal and Regulatory Affairs for the Wine and Spirits Wholesalers of America (WSWA), were featured in the “State of The Wholesale Market” workshop. They offered the most data of the three, with perhaps the most eye-opening number being the percent share change for premixed cocktails (up 28.4% from February through June, per SipSource). It is a reflection, Stratton said, of the growing nature of the cocktail culture amid the continued restrictions on tasting rooms and restaurants.

Hegeman said his organization saw some exciting policy changes forced by COVID-19, especially on the state level. For instance, licensed retail delivery is now permitted in 32 states while third-party delivery is allowed in 24 states. Similarly, on-premise to-go sales of food and mixed beverages already were gaining momentum before the pandemic, which “accelerated” that trend. 

Eric Guerra
Eric Guerra

“COVID-19’s Impact,” the second session, focused mostly on how those in the wine industry were “forced to come out of their comfort zone,” as moderator Eric Guerra put it, with an emphasis on what worked and what could continue post-pandemic. 

Technology was mentioned often. Jason Haas, the partner/GM of Tablas Creek Vineyard, in Paso Robles, California, noted using it for a non-located trade event allowed them “to reach people where they are.” He added, “For me, it’s so much more efficient and so much more durable than the old model.”

Mike Wangbickler, president, Balzac Communications & Marketing, said that “one benefit of COVID is that it has really kind of pushed more winery owners and leaders in the direction of adopting new technologies and having to innovate. They have no choice now,” he said.

That complemented nicely the stories of Kim Stare Wallace, president of Dry Creek Vineyard, in Healdsburg, California, who offered several anecdotes of how her winery has effectively used social media. 

Kim Stare Wallace

For instance, she said, they implemented a Bingo game that tied into the history of the winery for a distributor sales team meeting because they wanted to do something “fun and different.” They also have developed a partnership with a local cheese purveyor, she said, adding, “You can set up those partnerships and you can do those virtual tastings … and be just as effective as the big boys. The biggest challenge was just learning the technology,” and that was enhanced by the small investment of a “diva light.” It doesn’t take a lot of money, she stressed, just ingenuity.

And if something goes awry, said Sarah Jones Gillihan, VP, Benson Marketing Group, don’t sweat it. “I think that’s part of the charm and part of the opportunity with this format,” she said. “Move forward. Tell your stories. The word wine tasting is a bit of a misnomer. It’s not about the wines themselves, it’s about access to the winery,” the people who work there and the synergy that exists.

“Through the Distributors Eyes,” the third workshop, was moderated by Laura Webb, a founder of Webb Brand Consulting and partner at Okos Partners.

Pivoting and innovation were two words that popped up often as the sales channels quickly changed because of the pandemic. “We saw huge increases with our retail customers using our e-com platform,” said Adam Pizer, VP Business Development, Wine / Breakthru Beverage. adding the need they saw to provide ample resources for their business-to-business and business-to-consumer channels such as Drizly and instacart.

Philana Bouvier, VP of Fine Wine, Supplier Business Development, Republic National Distributing Company, stressed the importance of a strong digital marketing program with high-resolution images and videos, and on effectively communicating to sales teams on the distributor level “what we are doing and here’s how we are reaching out to the consumer.” 

For Mike De Loach, owner and president, MD Wine Industry Consulting, embracing technology was long overdue. For instance, gotomeeting.com has been around for two decades but until this year he couldn’t persuade his business partners to use it. “This has really forced us to adopt a lot of these tools and best practices that have actually been in existence for a long time.”

As for advice for wineries to maintain their presence in the marketplace, Bouvier called it “a tough time for everybody. This is about mental toughness right now” that requires compassion, patience and flexibility.

The wholesale focused sessions of the Wine Industry Sales Symposium are now available for replay on YouTube.

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