|MJ Dale, KLH Consulting|
This is part II of a piece on DtC by that most awesome of awesome women, Mary Jo Dale of KLH Consulting in Santa Rosa. (Check out the link attached to her name if you want to see what I mean by her awesomeness.)
Yes, you came to the right place. This is SVB on Wine, but as you know from last week, “A man has got to know his limitations,” and MJ is leaps and bounds smarter than me when it comes to Direct Sales, CRM, Club Management, and current technology supporting all of that. Every time I hear her talk, I come away with something new. You have an opportunity to ask all the questions you want and not get charged her $5,000 an hour rate. (You just wasted $176 reading this.)
Give customers choice—especially higher end customers.
Consumers have choice in almost every other transaction in life, so why not in their wine shipments? The power of choice is important, even if the customer elects to never exercise this choice.Yes this increases complexity, but with a sound operational strategy and robust behind the scenes technology it is possible. At a minimum, be sure to offer customization to your very best, higher value customers.
Price wine fairly to longer term customers.
Of course we don’t want to compete on price, especially if we have invested a lot in the wine experience. That said, consumers are digitally connected all the time. They know they are being gouged when wines in their shipment are easily available somewhere else for less. This destroys direct relationships quickly. Take the extra time in product planning each year to make sure that most of the wines sold direct are unique and that your pricing strategy is thoughtful across wholesale partners and every direct channel
Delight the customer, one shipment at a time.
Each shipment is an opportunity to connect with your customers tangibly—are you taking advantage of what goes in the box? Everyone sends wine and a newsletter; leverage this customer touch further by delighting your customers with some small surprise they can look forward to each time. Consider a food wine pairing wheel featuring your wines, over sized picture postcards portraying your vineyards in the current season, random “golden tickets” which, if found in the box by a customer, entitles them to a private dinner with the winemaker. The options are limitless—choose ideas that are core to your brand and differentiate you from all the other wine club offerings out there.
Know Your Customers
The customer list is one of a winery’s most important financial assets; just as important as the vineyards or the wine inventory. Why then do most of us treat the customer list as a mere communication and contact tool? Why do we forget to ask the customer what THEY want?
- Collect and securely store customer information from interactions online, in the tasting room or at events—even those customers that don’t join the club.
- Annually, do an RFM (Recency, Frequency and Monetary) analysis of the entire customer base.
- Once you know the present “value” of your customers, you can create basic value tiers and change your marketing investment and sales/service strategy accordingly.
- Consider investigating the potential value of your customers so that you can also put actions in place to discover and nurture these hidden relationships. Use this knowledge to find new customers that match the profile of your most valuable customers.
- Survey your customers to see what they want and don’t want from the wine club. The answers might surprise you.
Is your winery guilty of launching just in time DTC offers or last minute wine club shipment planning? Are customer communications always a fire drill? Are you always fighting with your technology systems to achieve your goals?
- Plan your DTC actions and offers across all channels for the year—make sure that product and pricing and offers are well aligned across every customer touch point. Customers are smart—they sense the chaos when the message and the wines delivered are not in harmony.
- Set goals for each channel and every program—then translate into goals for each of the people on your team. Measure their success. Use the results to help prioritize your efforts for the next year. When your initiatives and players are tied to both financial success and customer success (attracting, retaining and selling more to customers) — DTC is better aligned with the overall business of wine. This will ensure better support from your leadership—-and additional investment when needed.
- Make sure your technology supports, but does not dictate, your customer strategy. Given the many technology players present in the wine industry today (and even within each winery) this can be challenging—but very possible. Start by better leveraging the current systems and adopting a plan to evolve your technology capabilities over time.
The wine club product is alive and well—if managed artfully. The real opportunity for our industry, however, lies well beyond the wine club. Differentiate your offering, coordinate DTC people, process and technology across channels and focus on your customer at all stages of the relationship. The sales will follow—both inside and outside the club.
EDITOR NOTE: Please fire away and MJ … she can take it. Ask her the hard questions. You will be the better for considering her points and digging a little deeper with her.