Direct-to-consumer (DTC) sales are crucial to most wine businesses and have become even more important in the past two years with disruptions to other sales channels.
Research conducted by Wine Australia in 2021 provided insights into what consumers are looking for when buying direct from wineries, which can help wineries design effective direct sales strategies. The insights presented below are based on a survey conducted of 1000 wine consumers in Australia and in-depth interviews with a small number of wineries.
Insight 1: The decision to purchase or not purchase at the cellar door is primarily influenced by the quality of interactions with the staff
‘Sit down tastings have been great to engage with customers on another level’
The majority of survey respondents said that a large proportion of their decision to purchase or not purchase at the cellar door was based on the staff. Positive interactions included staff having knowledge about the wine, conversations between staff/consumers and staff being personable. This would see consumers purchase more than 2 bottles based on the experience. However, negative experiences, including lack of knowledge of the wine, not being looked after and/or being ‘forgotten about’, might lead to no purchases or a reduced number. According to self-reports by the survey respondents, the average number of bottles purchased was just over 3, with 36 per cent buying 2 bottles. It was notable that the 55+ age group had a higher mean purchase of 3.74 and were significantly more likely to buy 6 bottles or more than the respondent group as a whole (Figure 1).
Figure 1: Number of bottles purchased at the cellar door as nominated by consumers – by age group (percentage nominating each number)
Note: Click on the age group in the chart heading above to reveal the figures for that age group.
Source: Wine Channel Purchase Behaviour of Australian Wine Consumers – October 2021
Insight 2: Special offers, exclusivity and convenience are more important to wine club and cellar door customers than discounts. Free delivery is most often nominated by consumers as a desired improvement.
‘Cellar door and the wine club are built on loyalty not on price’
The consumer survey found that the main drivers for purchasing from a winery or a wine club did not include discounts or low prices. The top 4 reasons nominated by survey respondents for buying from the cellar door were:
- I like to try before I buy (39 per cent of respondents nominated this option)
- I like buying directly from the winery (32 per cent)
- I like to get recommendations from the winery staff (28 per cent), and
- special offers (26 per cent).
The top 4 reasons for buying wine through a winery-owned wine club were:
- special offers (35 per cent)
- convenience (32 per cent)
- better value for money (29 per cent), and
- better range (28 per cent).
Wineries interviewed as part of the research generally counselled against discounting, which can devalue your brand and does not necessarily increase profit. Instead, these wineries offer value-adds such as additional products, gift wrapping, personalised notes and reward schemes. Free freight is commonly used as a value-added benefit, and was also the most popular nomination in the consumer survey as an area for improvement for wine club purchases (46 per cent of nominations). See Figure 2.
Figure 2: Areas for improvement for winery-owned wine clubs nominated by consumers and comparison with independent wine clubs (percentage nominating each option)
Source: Wine Channel Purchase Behaviour of Australian Wine Consumers – October 2021
Insight 3: Leveraging multiple channels and having a targeted communication strategy supported by a good customer database is key to maximising sales
Make it as easy as possible for customers to buy
Traditionally, the cellar door is where sign-ups to wine clubs and mailing lists occur, while online sales occur independently. This model limits opportunities to capture new customers and to cross-sell products across different channels. An integrated model, supported by a central database, gives wineries multiple touchpoints to contact, sign up and send offers to customers (Figure 3a and 3b).
The disruption to consumer purchase behaviour caused by COVID-19 has made leveraging multiple channels even more important, as the closure of cellar doors at different times and corresponding increase in online sales have provided an opportunity (and necessity) to sign up new customers in a different way.
Figure 3a: Basic model of DTC channels showing limited customer entry points and connections between channels
Figure 3b: Integrated model of DTC channels showing multiple customer entry points, connections between channels and a central customer database
The Wine Channel Purchase Behaviour of Australian Wine Consumers report (Dec 2021) can be found here.