A Great Case Study from the Direct-to-Consumer Wine Conference

Sovos/Ship Compliant’s conference took place this summer in the Napa Valley with a couple of notable differences. The first was its focus on diversity and the second was its hardcore marketing insight from millennials.

The conference’s statistical focus was—as usual—on the rise in direct-to-consumer [DTC] wine sales over the past year during the pandemic. According to Ship Compliant—which provides wineries with shipping and distribution compliance and management—DTC shipment value rose 8 percent over a year ago.

Some other salient findings included that last year marked a year of recovery and return to normalcy for the wine industry, in a year that was anything but. An unprecedented 11.8 percent increase in average price per bottle on 8.5 million cases shipped from American wineries was logged last year. Smaller wineries performed better than large ones for a change and Napa wineries rebounded while Oregon boomed. DTC winery shipments captured an impressive 12 percent of off-premise sales of domestic wines, an increase over 10 percent the previous year.

A Millennial Perspective

Beyond the hard data, some of the most interesting presentations of the gathering came from one of its younger attendees. The wine marketing case study presented by Ed Feuchuk, the general manager of the Napa-based Farm Collective Napa Valley, was revelatory.

The Farm Collective represents the Tank Garage Winery, out of Calistoga, located in a renovated old gas station. Feuchuk detailed how he and his team created a never-ending stream of limited brands for the winery, all of which generated lines, excitement and sold out in no time.

Some of the wineries current brands include “Pray for Surf,” “California Gigolo,” and “Boys! Boys! Boys!” The names and the labels are kind of stream of conscious and intended to be so. He added that in creating so many wine lines he the group strove to emulate sneaker brands which are constantly attracting attention by rolling out limited editions of cult brands.

As a result, he reports that the average online sell-out time for these unique 72-case lots is 49 minutes. These limited-edition wines, which he called drops, are the third most valued benefit for the winery’s members and that customer-generated social media content increases 50 to 200 percent during these special drops. How is that for free advertising?

The Concept Behind the Wines

The wines, he notes, are promoted with short-form video and storytelling. The limited lots create FOMO (fear of missing out), as he noted “customers enjoy flexing to their peers about acquiring a rare wine.”

Long lines generally form during a new drop, he notes, and the experience of customers standing in line waiting creates a unique shared experience. It also keeps the Garage Tank Winery packed to the gills on weekends.

The wines need to be compelling and original, he adds, like the Pizzaboy wine. It was created to pair with its namesake and features a charmingly retro 1950s couple cradling a slice of pizza.

The winery also goes way out of its way to offer club members flexibility with wine preferences and vacation holds. They offer Amazon Prime-like memberships to customers and Feuchuk notes that customized releases have an average value that is 32 percent higher than a suggested release.

Maybe some established wineries should take a note or two of out the book about how young disruptors are really promoting wine. They bottles may be a far cry from sneakers, but they are flying off the shelf as quickly.