Sessions explored channels for improved
customer communication and audience interaction.
By Alexandra Russell
The 2023 Direct to Consumer Wine Symposium, which took place Jan. 18-19, was a forward looking affair featuring panel discussions and data presentations focused on future opportunities for the wine industry — and, of course, DTC, in particular.
The opening keynote address from Hugh Scallon, VP and head of video activation for Vayner Media, looked at how dramatically television and entertainment have changed in recent years and what advertising opportunities have been created as a result. In his presentation, TV 3.0 and the Democratization of Broadcast Media, Scallon zoomed in on the shift from traditional, “linear” program delivery to streaming. The latter includes smart TVs, online video platforms such as YouTube, Roku and similar devices as well as social media (especially Facebook, Instagram and Tik Tok).
At the end of 2022, streaming accounted for 38.2% of all video/programming access, making it the largest delivery method and turning traditional media advertising on its head. Gone — or at least usurped — are national ad buys, time slots and content restrictions. The freedom of social media and streaming has rendered those restrictions nearly obsolete. Today, multiple platforms create “billions” of advertising and branding opportunities, including the ability to target very specific audiences (by demographic, location or interest).
“Brands are built in social [media],” says Scallon. “It’s where stories begin.” He encouraged direct engagement through comments (“build a relationship”) and zeroing in on potential customers by tracking where and how your brand is being discussed. These days, TV viewers will watch with a second (even third) device nearby to dive into brands and information in real time — what he calls “over the top TV.”
Free the Grapes!
The DTC Wine Symposium is presented by and a fundraiser for Free the Grapes!, a national grassroots coalition of wine lovers and wineries that seeks to remove bans and streamline restrictions in states that prevent consumers from purchasing wines directly from wineries. FTG executes state-specific advocacy campaigns encouraging consumers to write their legislators, and works with media and advocacy groups to keep the issue alive.
When Scallon had concluded his address, Jeremy Benson, president of Benson Marketing Group, introduced FTG’s ongoing tactics and recent outcomes. He also encouraged letter-writing campaigns to state legislators, calling this grassroots strategy vital to FTG’s success. For anyone interested in starting or continuing a campaign, FTG has developed messaging and organized lobbying efforts that can lead the way.
Steve Gross, VP state relations for Wine Institute, provided an update on FTG progress. Going state-by-state, he outlined where DTC legislation stood — the good, the bad and the undetermined — highlighting 2022 wins and encouraging continued diligence in those states still considering levels of regulation.
Currently, all but two states allow some level of DTC, but work continues to ease restrictions and standardize access. Detail work includes efforts to remove capacity caps, onsite ordering requirements, fulfillment house issues, common carrier (UPS, FedEx,etc.) requirements, delineating the difference between (local) delivery and (distance) shipping, and complicated and confusing permit processes.
The wine industry’s DTC progress is being closely monitored by the beer and spirits industries. The opposite is also true, as FTG advocates work to ensure those beverage categories don’t unintentionally undermine existing wine DTC laws.
Experiential Marketing
Susan DeMatei, president of WineGlass Marketing, moderated a session titled “Modern Consumers Demand Modern Experiences – What New Technologies Are Delivering Results?” featuring Jon Stamell, co-founder and CEO of customer engagement platform Oomiji; Peter Oberdorfer, founder and president of experiential content creators Tactic; and Adam Ghahramani, co-founder and president of Hello Fam, the first NFT wine brand.
Acknowledging that wine marketing — indeed, marketing in general — has changed dramatically in the last decade, Stamell explained how Oomiji’s proprietary data capture combines the best components of market research, CRM and email marketing. Using targeted follow-up questions and drop-downs to identify specific traits and build brand loyalty, “[Oomiji] can collect more data per interaction,” he explained. Every piece of information helps establish a trusted relationship for the consumer.
Tactic engages customers at the point of sale by developing “living” wine labels (19 Crimes and Chateau St. Jean are clients). Its augmented reality (AR) experiences include prisoners confessing to their crimes, zombie hunts, historical figures touting their brand, property tours and art becoming active. Oberdorfer called it “camera first marketing,” adding that, in most cases, customers must pick up a bottle to engage with the technology. That contact, more often than not, leads to a sale — as does the desire to share the experience with others. Though still in early days (and still likely cost prohibitive for smaller producers), the AR possibilities are endless: puzzles, games, pop-ups, celebrity cameos are just a few options. As the technology becomes more standardized, expect it to become more accessible to more companies.
Comparing NFTs to “wine futures,” Ghahramani enthused about Hello Fam’s inaugural release Genesis Vintage 2021, a Syrah Blend from Jezreel Valley winery in Israel, which sold more than 700 cases in one week, a full year before its production. An NFT from Hello Fam can represent either a case or single bottle, which can be bought, sold, traded or redeemed. As more wine is delivered and consumed, the remaining NFTs become more valuable. “We’re building future experiences,” said Ghahramani.
Whatever engagement platform you use, advises Stamill, encourage your customers to sign up for or become a member of your group. Ultimately, these (and other evolving marketing methods) are channels for improved communication and interaction. Use them to create a captive and interested audience.
2023 DTC Wine Shipping Report
Day 2 was highlighted by a first look at the 2023 DTC Wine Shipping Report. An annual collaboration between Sovos ShipCompliant and Wines Vines Analytics, the Direct-to-Consumer Wine Shipping Report is considered the most accurate representation of the American direct-to-consumer shipping channel. Larry Cormier, Sovos ShipCompliant VP/general manager, and Wines Vines Analytics Editor Andrew Adams together led the audience through the report’s highlights, including key trends in volume, value, shipment destinations, as well as outcomes by region, varietals and price tiers. The full report will be available online January 24.
Analyzing 45 million shipping/DTC transactions last year (after anonymizing the data), researchers found a more than 10% drop in total cases shipped — the first drop since this report was established 13 years ago. An accompanying first-ever drop in value (1.5%) did not bode well, as DTC favors higher priced wines. Adams attributed some of these decreases to a post-pandemic correction, explaining that consumers are now able to return to on-premise and retail purchasing.
Bottle prices increased about 10%, as wineries began adjusting prices to reflect higher shipping and packaging costs. This did not slow demand for higher priced wines ($50 per bottle or more). Nearly 50% of DTC transactions involved wineries with 50,000 cases production or less (including limited production operations); these smaller houses typically produce higher priced wines.
Overall, Cormier and Adams agreed, DTC has reliably outperformed the overall U.S. wine market, but that’s expected to change as shipping begins to keep pace with the industry as a whole. In this, however, they see opportunity for individual producers to beat the statistics by concentrating on existing customers first.
Luckily, over the course of the 2-day conference, attendees were provided with myriad tactics and strategies for doing just that. Other future-looking topics included workplace diversity and equity, short-form videos and podcasts, text marketing, alternate packaging and event development.
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Alexandra Russell
Alexandra Russell is Managing Editor at Wine Industry Advisor. She can be reached at arussell@wineindustryadvisor.com
