In a recent Commerce7 and Sovos ShipCompliant webinar, experts from each team shared the latest statistics and trends in direct-to-consumer (DtC) wine and offered tips on how to leverage them to grow your business. Here are the main takeaways from presenters Zach Kamphuis and Karen Urquhart of Commerce7 and Sovos ShipCompliant’s Alex Koral.
DtC wine shipping in 2022
Last year, the overall winery market was dominated by limited production (less than 1,000 cases) and very small (1,000-4,999 cases) wineries. Without access to the three-tier market, smaller volume wineries often opt for direct-to-consumer shipping to reach their customers. And in the last 10 years, the average DtC bottle price has hovered around $35-$40, proving that you don’t need a massive footprint or high-priced vintages to achieve success.
Interestingly, 2022 saw the first decline in volume of wine shipped in 13 years. The decline comes after a decade of double-digit year-over-year growth, and on the heels of three years of truly phenomenal growth fueled by pandemic related stay-at-home DtC buying. As wineries, bars and restaurants opened back up, the market began to correct itself.
With this information in mind, utilizing data-driven insights is invaluable to maximize engagement with DtC consumers.
Tasting room tactics that feed DtC success
Selling wine online is difficult without an email marketing strategy. By capturing emails in the tasting room, you have the ability to communicate with out-of-town visitors who have already been wowed by your staff, campus and wines. When they go back home, leverage their great in-person experience to proactively remarket to them. Top performing wineries take the time to explain to their team the importance of email captures, and how to create meaningful invitations for their guests. After tasting room professionals wow customers with their knowledge, inviting them to learn more or enjoy an exclusive offer will pique the interest of consumers and lead to success in and outside of the tasting room. Kamphuis says there is a significant correlation between getting emails and creating online sales.
The 10 top performing wineries on the Commerce7 platform have a nearly 70% email capture rate, compared to the 3% rate of their 10 lowest-performing wineries. For every dollar these same wineries sold in the tasting room, the top wineries sold $0.78 online, while the bottom wineries made $0.18 in online sales.
Ecommerce best practices that drive bigger carts
Some of the easiest ways to grow bigger carts lay in the art of website design. Strategies like including buy buttons on list pages make it simple for online shoppers to browse your selection and add their favorites to their cart. If a customer wants to buy multiple products and your user experience forces them to open multiple tabs or pages, the odds of each bottle making it to their cart decrease. Unnecessary clicks add friction to the buyer experience, and 64% of add-to-cart clicks come from a page where multiple products are listed.
Nearly 70% of carts are abandoned. By knowing what leads to abandoned carts, you can drastically reduce that number. The top reason for abandonments during checkout process is high shipping costs. For this reason, the Commerce7 team recommends building the price of shipping into your bottle price or offering discounted shipping upon a specific bottle quantity or order value. A $70 bottle of wine may be easier to justify than a $50 bottle that costs $20 to get to your customers’ front door.
Mobile wallets can also make an impact on your online sales. Most site visits occur on a mobile device, so offering a one-click checkout experience with a mobile wallet is a value-added touch. Another tip is to chase abandoned carts through automated emails. The average abandoned cart email is opened 45% of the time, far above the average marketing email open rate. When the links in these emails are clicked, half of consumers will continue through the checkout process.
Insights on successful wine clubs
The benefits of email capturing also dip into club memberships. On average, consumers will purchase 4.22 online orders before signing up for a wine club. In fact, 21% of club signups occur online.
When it comes to club sales, flexibility is king. When given the opportunity, 31% of members edit their shipment. Club members who can buy more SKUs see their orders grow by 13%. Not only does the ability to edit their order increase the average order value, but there is a decrease in churn or cancellations.
With data and insights from Commerce7’s 2022 Data Book and the Sovos ShipCompliant 2023 Direct-to-Consumer Wine Shipping Report, produced in partnership with Wine Business Analytics, you can feel empowered to grow your DtC business.
Take Action
Learn the ins and outs of interstate DtC wine shipping with our Direct-to-Consumer Wine Shipping Rules.
