Thinking small is holding you back
When it comes to the ability to sell wine and spirits via the 3-tier system (trade sales) you don’t hear a lot of talk about selling “at scale.” Most in our industry believe selling is about pulling samples and sitting face-to-face with customers. That’s certainly ONE way to do it. But, it’s just not a “scale-able” way.
For decades now, there’s been only one way to “scale” your efforts to sell more wine and spirits. By signing on more distributors in more states. Or maybe moving from a small distributor to a large one. But my oh my how times have changed!
As is widely known by now, the capabilities of distributors to help small-to-medium sized wineries and distilleries have been significantly diminished. It’s not their fault. There are just way too many brands. Way too few distributors and that “ratio” is getting worse every year. The burden of growing sales & distribution now falls to the producer.
But I bring you good news: There ARE ways a winery or distillery can dramatically SCALE their sales efforts. Most of these new options are truly NEW, meaning they did not exist just a few years ago.
Not scale-able: 1-on-1 in-person selling, automobiles, and telephones
Scale-able: websites, software, direct response marketing, and outsourcing (brokers)
This article highlights 3 of the most powerful ways wineries and distilleries can SCALE their ability to sell a lot more product. Use one, two or all three for maximum effect.
There are two categories of online platforms for selling wine & spirits in 2020. The first is business-to-business (B2B) and the second is direct-to-consumer (DTC).
The most well-known and established platform for selling wine & spirits in a B2B context is Liberation Distribution, otherwise known as LibDib. LibDib holds distributor licenses in 5 states currently (CA, CO, FL, NY, WI) with many more on the way including (I think IL is next). Their business model is 100% online. Trade buyers (called Resellers) and small-craft wine & spirits producers (Makers) can connect virtually and transact business 24/7. The best part of the model in my opinion is you don’t have to deal with a salesperson. This alone should bring a site-crashing surge of traffic to their platform!
Like all great ideas and innovations, complimentary platforms will most assuredly follow in LibDib’s footsteps. One to keep your eye on is new-kid-on-the-block, GrapeIn. The still-in-beta GrapeIn platform aims to be a global “online community.” It will bring together foreign and domestic producers, importers, distributors, brokers and retailers (both on and off premise). GrapeIn is “distributor agnostic” so it really doesn’t matter what your distribution network looks like in the US. Anyone can jump onto the platform and start consummating deals.
When it comes to platforms for direct-to-consumer sales there are options than ever before. I just want to highlight a few of my favorite. For producers of craft spirits, one of the best platforms in my opinion (and experience) is Speakeasy Co. This CA-based tech company makes it easy to sell spirits right off your own website to multiple states around the US. They have a very clever way of integrating with a distillery’s website for a seamless shopper experience. We have several clients of ours who are leveraging this platform now.
Another bright star on the horizon is Spirit Hub (formerly known as Big Fish). They only sell in IL now but watch for them to expand soon. You don’t need your distributor to introduce you to these platforms. Just contact them directly.
The responsibility for building lots of high-quality distribution has shifted from the distributors to the producers. You must learn HOW to generate your own demand in the trade (restaurants, retail wine shops, etc). The very best and most scale-able way to do this is this powerful combination of Facebook Lead Ads and automated email sequences (using a tool like Convert Kit) or MailChimp, etc.
I have found that most wineries and distilleries have no idea this is even a thing. It’s a shame because there are few elements in the 3-tier sales game that are 100% within a producer’s control. If you’d like to a greater command of your own destiny, you owe it to yourself to explore this process more deeply.
There’s a steep learning curve, no question. But the time & money you invest in learning these new skills pays off many times over. Besides, the alternatives look mighty bleak! Not familiar with this game-changing strategy? Check out this recording of a recent webinar I hosted that walks you through the whole process from end to end.
The heart of this strategy is your email list of trade buyers. The goal is attracting these buyers to you (with your messaging, your targeting, and your content) and get them to sign up for your trade-only email list. From there, you “nurture” those contacts by providing a continuous “drip” of high-value content. Just imagine if you had a list of 1,000 well-qualified, engaged trade buyers who looked forward to receiving correspondence from you. Imagine what you could you do with such a powerful asset? But we’re not talking about annoying newsletters and obnoxious offers to buy stuff. Instead, focus on exclusive trade-only access and personalized service you can provide America’s top buyers. These trade pros WANT direct access to producers. So give it to them!
With the distributor bottleneck being what it is, we have certainly entered the age of the broker. What the world needs right now is lots more independent tech savvy, well-connected “agents” who can get your products in front of all the buyers on your wish list. Hired guns.
Now, I’m not talking about “traditional” brokers here who focus on getting the distributors to act on your behalf. That way of operating is deader than disco. The days of “managing the distributor” are gone and you should severely limit your spending on that activity. I have a whole series on my YouTube channel called “Question Everything” to help give you a reality check.
The modern brokers, by contrast, don’t see “managing distributors” as the best way to get things done. What they do instead is leverage all their well-earned relationships with key buyers (both on and off premise) to bypass the distributor bottleneck and SELL for their clients
Two of the best examples are Edge Beverage Consulting and Green Glass Global. Both have small armies of sales pros with all the right connections. And it’s those connections that allow them to build new distribution and sales despite the distributor bottleneck. Most small wine & spirits producers desperately need these services, but few even know they exist.
The great separation
When we emerge on the other side of this plague (and we will), I predict there will be a great separation among wine & spirits producers. On one side will be those who stubbornly cling to the OLD out-of-touch belief that distributors are primary engine that drives sales & distribution in today’s marketplace.
On the other side will be those who’ve not only accepted the new realities but have taken steps to ameliorate them. To learn NEW skills and NEW strategies.
For the former will continue to drink from the bitter cup of status quo. But the latter will move forward to enjoy the power and freedom that comes from taking control of their own destiny.