U.S. WINE MARKET: DISRUPTING THE SYSTEMNon-traditional marketing strategies to gain a competitive edge.

© 2015 Steve Raye

Steve Raye

Helping wine brands enter/grow in the US Market

Brand Development Trade Marketing Social Media

Steve RayeManaging PartnerBevology Inc.steve@bevologyinc.com+1 860-833-6272

Think Differently

Zig

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© 2015 Steve Raye

Think Differently

Zig Zag

© 2015 Steve Raye

Marketing Manifesto

Measure what matters: Impressions are important, but they don’t necessarily correlate with volume. Here’s what really matters:

• Sales on- and off-premise—cases, value, velocity

• Depletions vs. shipments/exports

• Distribution on- and off-premise

• Reorder rates, wine lists and BTG programs

Don’t market to empty shelves: Distribution is critical, make sure consumers are able to buy what you’re selling, even if it’s not in stock in-store.

Get it in, get it out: Getting distribution on- and off-premise is only the first step. Drive consumer purchase.

Help the importer and distributor do their jobs: Drive consumer demand at retail and ensure the trade is aware of that demand.

Target audience: You can’t be all things to all people. Determine your target and focus on it precisely, comprehensively, and consistently.

Geographic focus: Define your markets based on the best potential for sales gains, not total category volume.

Identify, then leverage your brand’s unique strengths: Have a POD that MAD:

point of difference that makes a difference.

© 2015 Steve Raye

Guiding Principle

Align programs with account needs…help them build their business: WIIFM

“What’s in it for ME?”What On/Off Premise Wants

•Increase sales (volume and/or profitability)•Increase new traffic•Increase customer frequency

© 2015 Steve Raye

Industry Trends

Millennials represent the largest wine consuming age-cohort—70 million +. They like to explore new and different things and are a primary force driving wine growth – particularly imports.

Overall, consumers are trading up to higher priced wines, with the most growth (66%) in the $12 - $15 and $15 - $20 segments.

E-commerce and new/non-traditional distribution channels are rapidly growing: 3.47MM cases in 2013 (up 9.3%). Wine.com does 53% of its business with imported wines vs. 27% for traditional retail.

Explosion in delivery-within-an-hour services: Minibar Delivery, Drizly, Saucey. New in 2014 and now active in NY, Boston, Chicago, Miami, San Francisco, DC and LA.

Industry Trends (continued)

Sources: Wine Opinions, Gomberg-Fredrickson, Wine Intelligence, B.I.G. Handbook, Nielsen et al.

• # of wine selling channels continues to grow

• Wine/liquor stores represent the largest number of off-premise outlets (wine sales in supermarkets is allowed in only 35 states and notably not permitted in NY)

• Wine/liquor stores account for disproportionately higher percentage of $12-$20 wines vs. supermarkets

Off-Premise Wine Selling Store Counts-by Channel

Dec. 2009 Dec. 2013

Wine/Liquor 40,384 43,675

Grocery- Conventional 16,662 17,019

Drug 8,082 12,390

Mass-Conventional 2,132 2,033

Grocery-Natural/Gourmet 1,066 2,539

Warehouse Club 850 911

Industry Trends (Cont.)

• Online access to news, recommendations, where-to-buy have displaced traditional print, especially for Millennials. They now seek information on Wine-Searcher, Vivino, Wine4me, Snooth, Hello Vino et al.

• Reach and Targeting:

• Wine-Searcher gets 3 million unique visitors per month, predominantly millennials.

• Snooth reaches 2 million people per month

• By comparison print circulations stand at: Wine Spectator – 400,000; Wine Enthusiast – 170,000; Wine Advocate – 48,000

Sources: Wine Opinions, Gomberg-Fredrickson, Wine Intelligence, B.I.G. Handbook, Nielsen et al.

You Can Change the Equation!

1 + 1 = 11

© 2015 Steve Raye

You Can Change the Equation!

1 + 1 = 11

© 2015 Steve Raye

Here’s How

Delivery within an hour, law of unintended consequences

E-Commerce optimization Content population strategy Social Media: What’s now, what’s next?

© 2015 Steve Raye

Delivery-Within-An-Hour

Drizly, Minibar Delivery, Drync, Thirstie, Saucey

Laser-Targeted to Millennials: immediate, no shipping upcharge

Geographically targetable down to metro market

Tool to drive retail distribution, support wholesaler/importer

E-commerce solution

© 2015 Steve Raye

E-Commerce

Allows you to sell in multiple states, nearly nationally, when you may only have distribution in one.

Strong penetration with Baby Boomers, average purchase is 3X typical physical store purchase

Has established awareness that it represents a better selection of hard-to-find wines

Tools like Wine-Searcher drive intent to purchase

E-Commerce

OptimizationBottle photo

Tasting notes

Technical notes

Food pairing

After

Before

© 2015 Steve Raye

Content Population Strategy

Evergreen PR: Publicity that exists forever on the web and attracts visitors at the precise moment in time when they are most interested in the subject.

Leverage the authority and authenticity of trusted sites.

© 2015 Steve Raye

Content Population Results

Visitors saw our content more when it was archived than when originally distributed.

That is a 7,823% ROI reaching people at the precise moment in time when they’re searching for this information

And they spent twice as much time viewing the content

Goal/Result: Delight the site visitor, add value to the site, leverage your marketing dollar efficiency

Santé Magazine Content Population Results

Page views generated in the week the article was posted

Total page views over 15 months

% incremental page views AFTER posting week… and still growing

12 articles posted monthly 575 44,984 7,823%

Average visit duration Site average 2:03More than double

Chile article average 4:15

Social Media: Build the Community

Advertising Phase I: Build the FB community

Advertising Phase II: Engage with the community

• Facebook is powered by a proprietary algorithm that determines what users see in their newsfeed. Because of this, on average, only 3% of a community’s users will see published content organically. The game has changed, you have to pay to play.

• Boosted posts are a type of Facebook advertising that will insert our page’s content posts into user’s newsfeeds based on targeting parameters. This would include both users that have “liked” the page and users who have not.

Twitter: use it strategically

Identify Somms, F&B managers, industry influencers who are actively engaged in subjects relevant to your brand

Focus efforts on those that the others follow…Klout score, follower base, engagement, posting frequency

© 2015 Steve Raye

Metrics Matter

“I know half my advertising doesn’t work…I just don’t know which half”

Pure E-marketing/

Ecommerce

ROI

Analysis and Performance Metrics

Some examples:

• Social Media Metrics give us real time insight into consumer engagement and interaction on Facebook, Twitter, Instagram et al, supplemented by data supplied by Facebook Insights and Google Analytics on your website.

Social Media Activation:Platform Recommendations

We recommend social media activity be focused on three primary platforms:

Facebook: The to engage with your broadest audience of wine consumers.

Instagram: Every picture tells a story

Twitter: Focus activities on key influencers who are actively participating

– Sommeliers and F&B managers have an active dialogue on Twitter centered around “wine geek” subjects of interest

© 2015 Steve Raye

Read the Book

© 2015 Steve Raye

U.S. competitions accepting currently non-imported winesUltimate Wine ChallengeAccepts brands not currently imported to the UShttp://www.ultimate-beverage.com/ultimate-wine-challenge-UWC/2015-wine-entry-forms/

BTI (Beverage Testing Institute)Accepts brands not currently registered in the U.S. Check site for deadlineshttp://us6.campaign-archive2.com/?u=da8603c0af6040dcc7e4d9ed2&id=8fdf91dae4&e=

San Francisco Wine CompetitionDeadline May 22, 2015http://www.sfwinecomp.com/

New York International Wine CompetitionMay 17-18, 2015 (Deadline for entries May 12)https://www.nyiwinecompetition.com/

© 2015 Steve Raye

Strategies

Focus, focus focus… and triage your initiatives into “must”, “should”, “could”. Make sure you do the “musts” before you do “should do” or “could do.”

Must Do Should Do

Could Do Target audience:

Be specific…demographics are important, but behavior is critical. Only spend money that gets in front of people who are receptive to your message, AND who can buy your product.

Recognize Millennials are a prime target and they do not subscribe to print magazines like Wine Spectator, Wine Enthusiast, Parker, or pay for subscriptions to Winespectator.com.

These publications are effectively invisible to Millennials: Google can’t see Wine Spectator ratings.

Takeaways

You can compete with the existing, major players by doing a few things really, really well Content Population: Get your content into

the right places so consumers find it when they are specifically looking for it.

Wine Apps: Vivino, Hello Vino, Wine Searcher, wine4.me

E-commerce Delivery within an hour Metrics matter

© 2015 Steve Raye

Contact

Steve RayeManaging PartnerBrand Action Team/Bevology Inc.

1 Darling Dr. 401 Park Ave. So.Avon, CT 06070 9th Floor

New York, NY 10016+1-860-676-7900 (o)+1-860-833-6272 (m)steve@bevologyinc.com

© 2015 Steve Raye