#013: Insights_Wine eCommerce: Trends, opportunities and use cases
We live in an era where we can get both perishable and non-perishable things delivered at their doorstep, thanks to the surplus available eCommerce solutions. And a more recent and trendy addition to this list are alcoholic beverages, with top spearheading eCommerce sales categories being wine, beer, and spirits. In fact, alcohol eCommerce is the next big D2C trend, with the global market projected to hit $42 billion by 2024. Like all the market segments, alcoholic beverages experienced a significant upsurge during the pandemic, leading to a 42% growth in alcohol eCommerce in 2020. As sales peak and more brands move their operations online, the wine eCommerce vertical would become a lucrative opportunity for wineries and wine producers.
Here we discuss the burning potential of the liquor eCommerce market, the top alcohol eCommerce trends, and the tips to develop a winning wine eCommerce strategy for maximum DTC conversions.
Digital commerce: The silver lining for the wine eCommerce industry
There are two kinds of alcoholic retailers, one that functions as an Amazon of drinks, meaning they source different liquors from producers, aggregate them in one location, and start selling (the B2B2C approach). Or, you are the producer and wish to sell your drinks directly to the consumers (the D2C approach. Either way, you can employ alcohol eCommerce and sell beers, wines, or spirits online.
Considering everything, a wine eCommerce solution that embraces leading-edge technologies, seamlessly integrates with all required business systems, and helps maintain all your online and offline sales on one channel just may be the solution for wine manufacturers and distributors. With the powerful modern-age eCommerce solutions like Adobe Commerce, Salesforce Commerce Cloud, Shopify Plus, and commercetools, you can establish a concrete online presence and serve customers locally as well as globally.
The top challenges faced by the alcohol industry when moving online
Most wine producers and sellers have still not figured out how to sell and fulfill orders online. Liquor eCommerce is still a new vertical and is currently being studied and slowly adopted by related brands. That said, here are some challenges wine eCommerce industry faces initially when moving online:
#1: The varying laws and regulations from state-to-state
Unlike non-alcoholic beverages, the selling of liquor involves a lot of licenses and compliance with district, state, and federal laws. This entire process is very time-consuming and requires related brands to obtain hefty approvals depending on where they are located and where they wish to sell. Due to this, many wineries and wine producers/retailers face challenges around alcohol transportation, shipping, logistics, and getting approval from authorities in the shipped location.
#2: Conveniently and efficiency manage and fulfill orders online
Combined with regulatory constraints, alcohol sellers also experience challenges around the proper storage requirements of their distilled beverages for maximum taste preservation, which demands carriers who have the proper tools and systems for transporting such beverages. Then, there are customer expectations around same-day, next-day or speedy deliveries, which are difficult to fulfill. This makes the entire order fulfill process for liquor and wine eCommerce marketplaces a challenge.
#3: Delivering the much-in-talk personalized experiences to users
eCommerce is all about omnichannel, connected, and personalized experiences, which becomes a jigsaw puzzle for wine brands to solve, especially when they are just penetrating the market. The entire equation of getting an up-and-running wine eCommerce platform for evolving the number of touchpoints is a little hard to get for wine manufacturers and retailers.
#4: Build a strong audience group online
While your brand might be famous in your area or district, when looking to sell borderless, you need to build trust in your product with your wine eCommerce solutions. This might feel like kickstarting your business all-over-again, especially online. Then, you also have to ensure that all your customers are within the legal age limit of consuming your beverages.
#5: Build a well-integrated wine eCommerce system for higher sales
While leveraging a wine eCommerce platform is just the first step, you need to bring all your operations online, from inventory, product management, and order fulfillment, to shipping, payment systems, customer relationship management software, and so on. This requires well-knit integrations to your core eCommerce platform, which can appear to be overwhelming and even discourage you from moving online.
Why wine brands must capitalize on these 7 alcohol eCommerce opportunities
Every business wants to maximize their profits, penetrate new markets, and adopt new practices and technologies. For the alcohol industry, embracing liquor eCommerce is a way to keep growing their B2B landscape while building a D2C channel for higher sales. While wine eCommerce is a big part of that equation, there are different eCommerce platforms and technologies that can simplify things for you. Here we discuss the rising opportunities for liquor and wine eCommerce marketplace that wineries and wine producers can leverage.
#1: The D2C avenue in wine eCommerce
The D2C wine eCommerce market is worth billions of dollars with more than half of the wineries considering the channel to be the fastest-growing in terms of sales. Reports suggest that wineries that sell directly to consumers yield higher profit margins than wholesalers. For small retailers, wine eCommerce is a perfect way to sell higher and faster, and to a higher group of consumers.
#2: There is still room for wine brands in the eCommerce market
While it is true that a few wineries and wine producers have adopted the eCommerce approach, there is still room for other wine players who wish to chunk a massive piece of the revenue pie. There is tremendous potential in the alcohol eCommerce marketplace, only if you know how to leverage it properly. Consider these notable liquor and wine eCommerce marketplace success stories:
- Drizly, a liquor and wine eCommerce marketplace reported a 350% year-on-year increase in their eCommerce sales
- Wine.com, a premium wine specialty retailer, ended 2021 with 115% increase on year-on-year sales
- ISWR, a drink market analysis company, reported an 80% increase in the overall value of alcohol eCommerce sales in 2021
#3: There is high customer demand for wine eCommerce
While shoppers are used to buying food and non-alcoholic beverages online, they eagerly look forward to browsing liquor eCommerce sites and get their dose of happiness delivered at their doorstep. For renowned wine and alcohol sellers might find it easy to attract audiences to their online stores, small and medium-sized sommeliers can indulge in tasting sessions, discounts, offers to get more visitors and build a reputation for their tasteful drinks.
#4: Provide B2C experiences to your B2B buyers
While D2C commerce is one revenue channel addition to your business, you can leverage your wine eCommerce platform to sell to B2B buyers like suppliers, wholesalers, and retailers. However, you need to note that even B2B buyers expect personalized shopping experiences such as custom pricing, volume discounts, custom taxation rules, automated price quote requests and negotiation; all of which can be delivered by a single platform that enables both B2B and B2C hybrid selling.
#5: Leverage innovative technologies to improve wine eCommerce operations
Technological innovations across production, sales, personalization, order fulfillment, product recommendation, shipping and delivery are beginning to take over. In fact, wine sellers are also:
- Testing sensors to help with vinification and wine aging, and adjusting the price of every bottle based on their aged number of years.
- Match customers with products as per their taste preferences and palettes with a predictive personalization software that captures data for each individual consumer as they visit the site, the products they look at, return, and so on. These software also rank every SKU based on their likelihood of imminent purchase.
- Leverage technologies and predictive algorithms to ease personalization, assess what has been achieved, and capitalize on it.
- Implement alcohol eCommerce trends around triggered personalization, omnichannel marketing, and email marketing to achieve the highest ROI.
- Innovate packaging solutions for boxed, canned, and single-serve wines.
The top alcohol eCommerce trends for liquor sellers and how to leverage them
In the last few years, wine eCommerce has become a more mainstream product in multiple marketers and its user base has expanded to include discovery-led wine drinkers and those who buy it regularly. For sellers who already are online or wish to build a wine marketplace online, the following alcohol eCommerce trends are a must-consider.
#1: Practicing the human-centric selling approach
When it comes to wine, people will need an experienced wine seller to guide them through their offerings, how one merlot is different from the other, and which is the best option for them. As people would be buying liquor online, they cannot taste or smell the wine before buying, which is why you must replicate that experience online as best as you can for new buyers or seasoned wine connoisseurs.
Read how we helped build a multisite eCommerce solution for Wine Connection here.
#2: Deliver a frictionless online buying experience
Alike with everything else bought online, even wine eCommerce needs to be speedy and responsive. Slow and archaic websites are a big let-down for users. Additionally, not everyone will be browsing your website on a desktop. You need to consider all the modern alcohol eCommerce channels, from web, social, mobile, app, web app, etc. and offer a consistent and connected experience throughout.
#3: Personalize experiences and sell your brand’s story
A good brand story is perfect to develop an initial connection with your shoppers. Combined with personalization, you can position your wine eCommerce business for assured success.
#4: Take a mobile-centric approach for your wine eCommerce business
While it is true that mobile eCommerce sales for wine, beers, and spirits is not promising, the rising trend around mCommerce denotes that it would become a preferred buying channel for users in the future. It is why you must equip your wine eCommerce website with responsiveness, agility, and scalability to boost your mobile sales.
#5: Leverage customer data to created branded experiences across touchpoints
The power of data is immense especially when it allows you to know your customers better and push personalized communications across. This data is collected via marketing automation, social engagement, user journey mapping, mobile app usage, email interactions, and offline engagement at tasting events.