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Customer Service Checkup

By Dr. Kathy Kelley 

We have touched on a few customer-service related issues and strategies in past blogs: responding to online comments and criticism (http://bit.ly/2wYNSZm), why customers would like to contact a customer service department using text rather than call the company (http://bit.ly/2wYPxhR), and the importance of “good customer service” (http://bit.ly/2wYQuqn), but today’s post focuses on providing good customer service, ways to learn about customer service issues, and strategies for appeasing dissatisfied customers.

Employer and employee expectations

How can employees provide exceptional customer service if they don’t know what is expected of them?  Because you are hiring an adult – you would think that they know how to treat people properly and always be a good brand ambassador.  While most employees will remember to smile and greet customers when they arrive and ask which bottles they would like to purchase after their tasting – you may need to remind/teach them how to interact with customers between the guest’s arrival/departure.  Or, you may need to educate staff on how to focus on visitors when the tasting room is packed, customers are two to three people deep at the bar, and staff members are just trying to remember what to pour next and who liked which wine.

To make sure that all staff members handle situations the same, it is suggested that businesses create a customer service strategy.  After you develop a strategy, print hard copies, require all employees to read and retain the document and have them sign a statement (that is kept on file) indicating that they understand what is expected of them (just like you would for your employee handbook).

According to an article posted on The Thriving Small Business website (http://bit.ly/2wXIqRW), a customer service strategy consists of:

  • Developing a customer service vision that employees fully understand
  • Asking customers (using surveys, comment cards, focus group sessions, or one-on-one conversations) if the level of customer service provided meets or (hopefully) exceeds expectations
  • Setting customer service goals (e.g., within how many seconds a visitor should be welcomed after they enter the tasting room)
  • Providing training and reviewing customer service skills during employee meetings or after an issue is brought to your attention
  • Holding staff accountable and rewarding excellent customer service (e.g., ask customers to indicate who provided exceptional customer service during their visit)

Further explanations and examples for each of these are below.

Developing a customer service vision that employees fully understand

If you have ever taken your Apple devices to an Apple store for service, or you are just browsing the store, you may be quite impressed with how they learn about customer needs.  According to a video produced by Carmine Gallo, President of Gallo Communication Group (http://bit.ly/2wYYNCD), Apple is most likely implementing the following five steps:

  • Approaching customers and giving them a sincere welcome
  • Asking questions to understand a customer’s needs
  • Presenting a solution that the customer can take home that day
  • Listening for and resolving issues or concerns
  • Thanking them for visiting and inviting them back

Asking customers if the level of customer service provided meets or exceeds expectations

You can approach this activity in a few different ways:

  • Hand a comment card to visitors and ask them to fill it out before they leave the tasting room
  • Post questions on your website and on your Facebook business page
  • Conduct an online survey using the free versions of com and SurveyGizmo.com (with limited functions) or purchase the full version on a monthly or annual basis
  • Use Google Forms (within Google Docs) to create a document that looks like a survey, which can be embedded into an email and sent to tasting room visitors/case club members. Recipients can respond to the questions and click the “submit” button when finished. You will then have access to a spreadsheet where responses are organized by survey participant

 

Screenshot 2017-09-27 15.33.13

Examples of questions that you can include in your customer service survey. 

 

If you learn about an issue where the custom was wronged:

  • Tell the customer what we can do (realistically) and correct the problem
  • Thank them for bringing the problem to your attention
  • Follow-up to make sure that they are satisfied with the outcome

Setting customer service goals

A goal could be that you will provide each and every visitor with an enjoyable customer.  In a Wall Street Journal article written by Dorothy Gaiter and John Brecher (“Tips for Tasting Rooms,” http://on.wsj.com/2wY1ggr) the authors listed a few of their tasting room “pet peeves” and behaviors that tasting room staff should focus on:

  • While tasting room staff do not need to be wine and viticulture experts they do need to be able to provide tasting room visitors with at least a “basic understanding of the wines”
  • Have a list of questions that will help staff suggest wines for visitors to try based on preferences. You might also want to have a list of wines that appeal to beer drinkers based on the style of beer they like
  • Be a “people person” and engage visitors in a conversation so that they don’t feel like just a sale
  • Have a little “something special” that you can offer wine enthusiasts, but be discreet if others are tasting too. You don’t want to pour samples for one couple and leave the bottle on the countertop and not offer it to others
  • Give all visitors your attention, even when there is a VIP at the tasting bar. Specifically, “If you are going to lavish wine and attention only on [VIPs]…take them to another room and flatter them instead of just pretending that we’re not there” (http://on.wsj.com/2wY1ggr)
  • Indicate which wines are only available at the winery, which supermarkets/retail outlets sell your wine, and if your wine is available for sale online

This quote may strike a chord: “Many impressive wineries offer very poor service with staff that ‘pour and ignore.’ They don’t act interested in the customer, and they expect all the energy to come from the customer’s side of the counter…To “pour and ignore” is like being the last person in a relay race and deliberately dropping the baton. It is the worst possible public relations we could provide next to outright rudeness. (http://on.wsj.com/2wY1ggr)”

Providing training and reviewing customer service skills

It is suggested that training tasting room staff “has the potential to reduce turnover and build staff loyalty… [and that] a winery may be able to obtain a competitive edge at the cellar door and improve the bottom line of its retail sales by incorporating strategic cellar-door training and development programs” for both existing and new employees (http://bit.ly/2x0okGw).

Several free resources are available online ranging from training manual templates (http://bit.ly/2ycFJB4) to video modules (http://bit.ly/2ydhqTr) to interactive “games” (http://bit.ly/2yc1D7d).

Holding staff accountable and rewarding excellent customer service

When you are out shopping and see customers interact with employees, discreetly observe their conversation and ask yourself:

  • Does the customer service representative look/sound like they are interested in helping the customer and that solving the customer’s problems is his/her number one priority?
  • Based on the customer’s issue, would your response be similar or different from what the customer service rep is doing/saying?
  • If you were the customer, would you be satisfied with the response/outcome?

Remember the saying “praise in public and criticize in private.”  Employees will feel a sense of pride and accomplishment when they are recognized for providing great customer service.  When you do provide praise:

  • Included details about the situation (e.g., while assisting a customer with buying wine for a gift…)
  • How the employee provided “excellent customer service”
  • The outcome/what happened as a result of the employee assisting the customer (http://bit.ly/2x0MjFK)

Empower your employees by giving them the ability to make decisions (http://bit.ly/2ybYDI0).  According to the article, “Think about employee empowerment, not as something a manager bestows on employees, but rather as a philosophy and a strategy to help people develop talents, skills, and decision-making competency.”

Where to look for customer service complaints online

Most likely you are aware of the following review sites and (hopefully) claimed your business page, where appropriate.

  • Yelp
  • TripAdvisor
  • Foursquare
  • Google local guides
  • Yahoo! Local

If you have not searched these sites for customer comments, it is critical that you know what customers are saying about your winery/tasting room.

Another site to consider, though you will not necessarily see customer reviews and complaints, is Glassdoor.com.  This is a website where employees complain/provide reviews about companies they (supposedly) work(ed) for.  While you may not learn about customer issues you may get an idea of how employees feel about your business and how they perceive manager/owner leadership and expectations.

For example, an employee, who worked in the tasting room at “X” in Kenwood, California, wrote that working at the tasting room was a “seasonally fun place to work,” but he/she also indicated that management focused “solely [on] sales” and that “a little more focus on simply learning the wines and delivering better client experiences” was needed (glassdoor.com).   Perhaps this employee never talked to the manager or owner because he/she didn’t feel comfortable doing so, maybe they have brought up issues in the past and felt the input was ignored, or maybe they just like to complain.  Regardless, now the comments are on the website for all to see.

If responding to online comments and criticism seem intimidating, look online for examples of how businesses have responded to customer reviews and comments (both positive and negative). Follow companies like Zappos.com, Apple, Trader Joe’s, JetBlue, Starbucks, and others you feel provide good customer service to see examples as to how you can appease customers who feel that they have been wronged.

Until next time.

 

 

 

 

 

 

 

 

 

 

 

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Telling your story: Letting consumers know why your brand is unique

By Dr. Kathy Kelley and Dr. Bonnie Canziani*

Every winery has a story to tell about its history and about its wines. A winery’s story often comprises the main advertising message that consumers receive. Critical visitor expectations are being formed as your potential customers read marketing materials about your winery or listen to your staff in the tasting room embellish on “the story,” using it as a performance script during visitor encounters. Indeed, your tasting room hosts are often the main onsite story tellers and serve a vital role as direct ambassadors of the brand and the company—sharing important information with all visitors to the winery.

In this post, we discuss why wineries should have a well-crafted story, examples of national brands that have been recognized as having compelling stories, and steps you can take to develop your story.

Why is a story important?

Researchers have investigated consumer response to storytelling to learn if businesses do benefit from such efforts.  The Origin/Hill Holliday research group conducted studies with 3,000 U.S. consumers, age 23 to 65 years, and investigated their response to winemaker stories. Two groups were shown product pages for four different bottles of California Chardonnay.  Group one was shown the pages with standard tasting notes, while group two was shown three of these product pages and a fourth page with the winemakers’ story instead of the tasting notes.  Based on responses, the researchers found that the second group “was 5% likelier to choose the bottle with the winemakers’ story – and willing to pay 6% more for it” (http://bit.ly/2umZCCE).

Brands that have successfully crafted their story

While both of the following examples are outside the wine industry, each is a successful business with owners who realize that their stories resonate with their clientele and that their narratives support important business strategies.

Being authentic and personable

Dannijo, a jewelry company created by two sisters, was built on the owners’ belief that a story needs to be “compelling to consumers, [such that] they want to build your products into their lives” (http://bit.ly/2tipnzG).  The sisters often model the jewelry in the ads and their social media posts include images of them outside the office and with their families, which helps make them relatable to their target customers.

In their stores, the sisters have installed a selfie booth for customers to take and share images of themselves having fun in the store (http://bit.ly/2tipnzG), and they host speakers who present “unexpected and yet brand-related subjects (e.g., fitness and health, philanthropy and sisterhood)” that are important to the owners and that can interest their primary customers (http://bit.ly/2tMN46Q).

These activities, their core products, and a café all encourage consumers to visit often and to extend the amount of time they spend at the retail outlet on each occasion.

Focusing on customers’ interests

Adidas, like several other brands, sells running shoes.  While their loyal customers will buy their shoes again and again, others are drawn to the business based on how they “feel” about the brand, how the brand helps professional and novice athletes succeed in the sports they love.

Adidas is also credited with being a “listening brand.”  Instead of talking purely about their shoes, the company learns what customers care about and then uses these concerns and passions as a basis for developing the “brand[’s] message through social conversations” (http://bit.ly/2tNdi9h).  Examples of Instagram posts based on follower interests include World Oceans Day, #RunForTheOceans (http://bit.ly/2tN4wbg); Earth Day; sustainable athletic clothing (http://bit.ly/2tMLS3c); and encouraging consumers to perform to the best of their abilities – both on and off the court.

So, what should you include in your story?

A brand’s story is more than words on a page designed to be a pitch for your winery.  Rather, your brand’s story includes “facts, feelings and interpretation” and is a way to differentiate yourself from competitors (http://bit.ly/2tNGkWf).  A successful story will help a business build a following, which in turn encourages these consumers to care about the brand and, hopefully, leads to customer loyalty.  Following are some tips for making your winery story genuine and engaging for your visitors.

  1. Storytelling is based on “interpretation”

Interpretation is a skill that connects your audience with information in ways that create emotional ties between the speaker and the listener. Basically, you take important facts about the wine (e.g., type of grapes or fruit used and production processes) and the winery (e.g., family history or facility information) and share these facts with your visitors in an informative and entertaining manner. A story is not just a dry recitation of facts and figures. Stories attract consumers looking for higher levels of personal recognition and warmth from service staff at your winery.

  1. Storytelling is part of your marketing strategy

Your goals need to be clear when forming and telling the winery story. Typical goals include connecting your guests emotionally to the brand, influencing guests to try something new (e.g., join the wine club or attend a future wine event), and motivating your visitors to buy your wine and share their experiences with others via positive word of mouth. One sign that your guests are engaged is if they ask for more details about the wines, the winery, or the winemaker/owners. A good story will lead to conversation and customer action.

  1. Your stories must seem genuine to your listeners

Storytelling in the winery setting needs to incorporate truthful information about your ingredients, your production techniques, and your business background. Stories create personal ties between the winery and its visitors and people want to be able to trust that the information you are providing is accurate and relevant. The more believable stories will be shared with others via word of mouth after the visit.

Example: Honor Brewing Company & Winery

It seems only natural for a winery to support a cause either with raising funds during an event to donating a portion of the proceeds/price per bottle to a charity.  Sometimes, though, the connection between the cause and the wine brand is not as clear as it could be and why the cause was selected (e.g., to help fund medical research for a disease that an employee has suffered from, to support local community efforts).  Honor Brewing Company, Inc. and Honor Winery owners either served in the military or who had close family members who did.  From the name to the labels (e.g., pictures of dog tags, combat boots) to their mission (“…supporting and celebrating those that have served or are serving…), the brand’s is exclusively “dedicated to the men and women who proudly serve our country” (http://bit.ly/2tO1J1K).

The owners also raise money and donate funds to charities that assist injured veterans and families of those who have fallen – and they are transparent in their efforts.  In 2014/2015 they raised over $200,000 for these charities.  They also encourage social media followers to post about family members in the military and partner with many veteran organizations.

  1. Stories are built on essential raw material

Winery stories need to cover the basics so that every visitor has a good understanding of the wines being served and sold, the fruit that goes into the wines, and other interesting details that make the winery business unique. Proof of quality is often incorporated into the winery story by emphasizing the various awards that your wines have won. The story can move from the past to the present as well as indicate new wines and strategies that are forthcoming in the future. It can also help the visitor identify the role of the winery in the greater community or wine industry in the state.

Example: Gimblett Gravels

When you think of the Gimblett Gravels Wine Growing District, terroir might be one of the words that come to mind.  This patch of land, 800 hectares, once “regarded as the poorest, least productive land in Hawke’s Bay…and no hope of growing a decent crop of anything” (http://bit.ly/2tNlKoN) can lay claim to producing grapes used to make award winning wines: domestically, 600 gold medals and 210 trophies and 105 gold medals and 35 trophies awarded in international competitions (http://bit.ly/2tNqGKD).

Screenshot 2017-07-17 14.45.00

Strict guidelines determine whether a wine can be marketed with the Gimblett Gravels designation.  These measures protect the brand’s image and ensure that growers and winemakers make no compromises and that only high-quality wine that reflects the terroir is bottled with the name and logo of the Gimblett Gravels Winegrowers Association.

  1. Most winery stories are also family stories

The concept of ‘family’ appears either overtly or as a subtext within many winery stories on their websites and during the exchanges between visitors and tasting room hosts. The idea of ‘family’ is represented in multiple ways:

  • remarks about preserving the family farm, land, or agricultural business heritage through the development of vineyards and winemaking operations (the ‘family-business’ message),
  • sharing a history of family generations in the wine-making business (the ‘family-tradition’ message), or
  • an advertising appeal aimed at generating closeness to the visitor based on the inclusive treatment of guests (the ‘join-the-family’ message).

Example: Wente Vineyards

Wente Vineyards in Livermore Valley, CA was founded in 1883 and is recognized as the oldest continuously-operated, family-owned winery in the U.S.  Their story begins with C.H. Wente immigrating to the U.S., learning about winemaking, purchasing land in California, and then…Prohibition was implemented (http://bit.ly/2tNtOpI).

Screenshot 2017-07-17 14.44.48

The family and the business survived hard economic times and war and contributed to the advancement of the California wine industry.  And, if this wasn’t impressive enough, the winery can boast that each winemaker has been a Wente including the current winemaker who is a member of the 5th generation (http://bit.ly/2tNtOpI).  What a story they can tell!

The various family messages can overlap in a single winery story. Family images are also positively associated with consumer perceptions of winery trustworthiness.

 

 

In closing

The art of storytelling can be especially useful to wineries that are trying to develop a visible brand presence and uniqueness in the marketplace. Ultimately, winery hosts need to know how to craft and present a winery story that moves their customers to positive actions, e.g., buying wine and sharing winery experiences with others.

 

*Dr. Canziani is a faculty member at the University of North Carolina Greensboro, Bryan School of Business and Economics, specializing in the management of customer service relationships and business profitability in various sectors including hospitality, tourism, and transportation. Since 2001, she has been involved in marketing and business research focused on the NC wine and grape industry, with more recent emphasis on wine tourism.

 

Taking a Good Look at Wine Labels

By Dr. Kathy Kelley

If a customer has never tasted the wine inside the bottle before “the label design and execution, as well as the verbiage,” can make or break a sale (http://bit.ly/2sxnxPF).  It is even suggested that at the point of purchase it only takes about 1.5 seconds for a wine label “to make an impact” on the consumer’s decision to purchase the bottle (http://bit.ly/2sx2i0c).

You may have wine labels that are well recognized and that your customers may respond, but it is also valuable to be aware of what some research suggests could attract consumer attention and what some brands are doing to encourage wine drinkers to “engage” with their bottle and (hopefully) share their experience with others.

Label illustrations, color, and design layout

While the “attractiveness” of a label is subjective, research has been conducted to identify label characteristics that appeal to consumers based on brand image (e.g., fun and whimsical) purchase intent (e.g., consumed at a restaurant, to give as a gift), and similar.

Screenshot 2017-06-16 11.18.18

Two University of California, Berkeley, researchers conducted a study during which participants evaluated wine labels to measure California Cabernet Sauvignon purchase intent based on six label colors, five illustrations, and three design layouts (Boudreaux and Palmer, 2007).  The researchers developed and tested 90 fictitious labels with the same brand name, origin, vintage, and alcohol content.  Though the images are black and white and only a subset of the 90 labels is presented you can get a sense of what the labels looked like by accessing the paper here: http://bit.ly/2swFQUg.

Their results revealed that the illustration presented on the label had the strongest effect on “market success factors and on brand personality” and in general the images that received the highest purchase intent scores were: 1) grape motifs and 2) images of a chateaux or vineyards.  However, if the brand’s goal is to develop a label to convey “upper class and value,” results suggested that a coat-of-arms illustration would be the best option.

The researchers reported that of the colors they tested, burgundy, red-orange, and neutrals “were seen as successful, desirable, and expensive.”

Millennial preferences

While the UC Berkeley study did not segment the data based on generation to learn what Millennials might prefer compared to older generations, such data has been published.

A 2015 Gallo Consumer Wine Trends Survey revealed that the label is important to Millennials, and wine drinkers in this generation are “4X more likely than Baby Boomers to often select a bottle of wine based on its label” (http://gallowinetrends.com/home/).  While the younger generation is “more likely to look for” labels with personality and originality, Baby Boomers look for information on labels that describe the region of origin and taste descriptors.

Elliot and Barth (2012) focused on understanding Canadian Millennials’ preferences for wine label design and personality. Participants, mostly 19 to 22-year-old undergraduates, were asked to list the most significant factor that influenced their wine purchasing decision.  Of the factors listed, 86% of the total mentions referred to an extrinsic [the package] factor (e.g., name of the wine, design layout, bottle) with 33.8% of all the mentions related to the “label,” followed by other “package elements,” color(s) (10% of the mentions), design (9.8%), the bottle (9.3%), and the image (9.1%).

Only 14% of the mentions pertained to intrinsic [the product] factors with the top three mentions being: the producer (6.1% of all mentions), type of wine (3.4%), and alcoholic degree (2.2%).  The researchers indicated that though the emphasis, at this point in their drinking career, is on extrinsic factors – it may be possible that “opinions and preferences” may shift to intrinsic factors as they age and their experience with drinking wine increases.

Participants were then asked to assign ratings to indicate how influential (1= not at all influential to 5 = extremely influential) six packaging characteristics were on their bottle selection.  The top three influential characteristics (rated between 3.83 to 4.00) were: label image or picture, design layout, and color.  Name of the wine, description of the wine, and shape of the bottle were less influential.  The authors point out that price was not tested, but if it was it probably would have “had a significant influence.”

Trying to learn what label factors appeal to certain generations is not restricted to just New World wine brands. Some wineries Bordeaux are designing labels that (hopefully) appeal to younger wine drinkers.

According to an article published in February 2017 (http://bit.ly/2sxYH10), the author interviewed two Bordeaux label designers about their approach to designing “non-traditional” labels.  One designer is quoted as saying, “The new generation of Bordeaux winemakers…[are] trying to break out from overwhelming history” by using “‘avant-garde’ design approaches.”  Another designer and the winemaker at Château Chasserat created a non-traditional wine called Père N 1775 (which includes the French word for father and the year the winery was created).  The associated logo has more of an Aztec feel/look than that of château or vineyard you would expect to see on a traditional bottle of Bordeaux.

Cultural influences

It is important to note that generation is not the only demographic that could impact response to wine labels, or any extrinsic or intrinsic characteristic.  Culture has been studied by a few researchers to learn how it may affect response to a wine brand, promotional approach, label/bottle characteristics, etc.

Lockshin and Cohen (2009) investigated what influenced consumers from 11 countries when purchasing wine.  Though examples of wine labels were not presented, participants were asked to indicate the relative importance of “an attractive front label,” in addition to 12 other factors (e.g., the origin of the wine, grape variety, promotional display in-store).

Participants were segmented into three groups based on their responses to survey questions.  While the smallest of the three groups, 16% of survey participants, one of the segments was based on making wine purchasing decisions based on displays, attractive front labels, and back labels.  A quarter of respondents from the UK were in this group, with slightly fewer Austrians (22.5%), Germans (20.9%), participants from the USA (16.4%), and Brazilians (15.4%) belonging.  Ten percent or fewer of participants from Australia, France, Israel, Italy, and New Zealand, and Taiwan were assigned to this group as larger percentages of these consumers made choices based on recommendations/previous experience or based on variety, origin, brand name, and awards.

“Cool” and interactive wine labels  

Last year, Pace Magazine published a list of seven wine bottles with labels that drinkers could play with, including one that revealed a “secret message” when a little bit of wine is poured on it and another that had a pull tab that served as a wishbone (http://bit.ly/2sx46qe).  Add to this the other online sources that create their own annual lists: Tasting Table (http://bit.ly/2tuwllM), Forbes (http://bit.ly/2tuzkuB), BuzzFeed (http://bzfd.it/2tuy3U2), and many others.

While the graphics, layout, and colors used on the label certainly attract purchasers, there are several brands that have added a Quick Response code (QR code; http://bit.ly/2std07Q) to their label.  The code, when scanned with a smartphone QR code reader, directs the consumer to a website with other pertinent information about the winery, the particular wine in the bottle, videos, social media sites, or anything that the winery decides.

One such brand is Brancott Estate in Marlborough, New Zealand.  The company developed the “Brancott Estate World’s Most Curious Bottle” app (http://bit.ly/2st5sC3) in 2012 so that wine drinkers could “interact” with bottles of their Sauvignon Blanc.  I have included some screenshots that I took while I was using the app, below.

Screenshot 2017-06-14 13.41.02

While I did have a bottle of the wine that I could use for this demonstration, if you do not have one you can use a picture of the bottle/QR code (from one of their magazine advertisements, for example) and certain app activities are available on app even if do not have a bottle/photo.

A Spanish wine brand, Bodegas Vihucas (Toledo, Spain) has created a blend of Tempranillo, Merlot, and Graciano called 8 TICKETS (http://www.8tickets.es/el-vino/; retail price of 9.60 euros).  The label is a metro map that when removed from the bottle (held in place with two stickers), after which it becomes a “game board.” includes directions on how to play the game, and has a space for the drinker(s) to color, draw, and decorate with stickers.

While I don’t have a picture of the bottle/label/game board, as the wine is only available a few Spanish markets (http://8tickets.es/localiza-tu-tienda/), they do have a Facebook Page with reviews (https://www.facebook.com/8tickets/) and Instagram account with images of the bottles and groups of drinkers having fun with the label/game board (https://www.instagram.com/8tickets/).  I did contact the brand and was informed that 8 TICKETS will be available in the U.S. “soon.”

As you might expect, the 8 TICKETS concept and label was developed to appeal to the Millennial wine drinker.  Specifically, the aim of the 2016/2017 A’Design Award & Competition Packaging Design Category winner was to “bring wine to [Millennials] through a memorable and participative experience…show young people all the situations in which wine can be a regular consumption product rather than being reduced to [only being drunk on] special occasions” (http://bit.ly/2sYyvKL).

If you would like to learn about wine and alcoholic beverage product and packaging trends as soon as items launch, visit Trendhunter.com.  You can learn about the new Coors Light can that changes colors when exposed to UV light rays (currently available in the Canadian market, http://bit.ly/2sYxwdM), Croatian wine that is aged in the Adriatic Sea in glass and clay vessels for 2 years at a depth of 20 meters (http://bit.ly/2sYveeu), and drinkable glitter flakes with a “subtle raspberry flavor” that can be added to a glass of prosecco for an even more sparkling wine (http://bit.ly/2sYhv7r).

What is presented in this blog post is just a small portion of the studies and examples of wine labels/bottle characteristics that appeal to consumers.  At Penn State, we have conducted several studies that investigated consumer response to a number of different wine bottle components.  Among the data that we have published in this blog, one study, in particular, focused on what information and features a winery should consider including on the back label (http://bit.ly/2sxTre7).  As with other marketing information we post, it is crucial to understand who your customer is and ask them to respond to your label ideas before making any significant changes or investments.

References

Boudreaux, C.A., & Palmer, S.E. (2007). A charming little cabernet. International Journal of Wine Business Research, 19(3), 170-186. doi:http://dx.doi.org.ezaccess.libraries.psu.edu/10.1108/17511060710817212

Elliot, S., & Barth, J.E. (2012). Wine label design and personality preferences of millennials. The Journal of Product and Brand Management, 21(3), 183-191. doi:http://dx.doi.org.ezaccess.libraries.psu.edu/10.1108/10610421211228801

Lockshin, L. & Cohen, E. (2009). Using product and retail choice attributes for cross-national segmentation. European Journal of Marketing, 45(7/8), 1236-1252.

 

 

Connecting with wine consumers and tasting room visitors via mobile devices

By Dr. Kathy Kelley and Jen Zelinskie

You could be reading this blog post on a desktop, on your iPad, or your Samsung Galaxy smartphone.  As the number of devices available to read what we and others post increase so do the best practices associated with creating and posting relevant content.

This post provides information to supplement what we have shared in the past about using technology to connect with customers and tasting room visitors.  Content describes our participants’ cell phone (basic and smartphone) and tablet ownership, the percentage who installed a mobile wine app, and interest in mobile wine app features and receiving text messages from winery tasting rooms.

We will continue to ask participants about their smartphone, mobile app, and other relevant technology use in future surveys.

Smartphone use in the U.S.: Current ownership and forecast

 The very first phone that “meld together the functions of a cell phone and a PDA (personal digital assistant)” was introduced in 1992, although it was not until 1995 that the device was referred to as a smartphone (http://read.bi/2kNBfXa).   As you can imagine, with a retail price of $899 in 1992, consumer adoption was a bit slow at first.

In 2015, 68% of U.S. adults owned a smartphone, and, as might be expected, younger consumers were more likely to own one than more mature consumers.  Smartphone ownership at that time was:

  • 86% of survey participants age 18 to 29,
  • 84% of 30 to 49-year-olds,
  • 58% of 50 to 64-year-olds, and
  • 30% of participants age 65 and older (http://pewrsr.ch/2lo7PCV).

There’s no denying it, many of us consider our smartphones to be essential to our everyday life.  We use these devices to communicate with others, keep our calendar, be used to deliver presentations, and manage our finances.  The capabilities seem almost limitless.

Then it should come as no surprise that these devices are never far from our reach.  In a separate 2015 survey, 81% of U.S. adult smartphone owners responded “yes,” to the statement, “I keep my smartphone near me almost all the time during my waking hours…” and 63% reported that they kept their smartphone “near them at night even while sleeping” (http://bit.ly/2lo0Ae).

Furthermore, we are more likely to turn to our mobile devices than our desktops to “get online.”  In June 2014, the number of “unique visitors” who accessed digital content on mobile devices “passed” the number of unique visitors who accessed digital content on desktops.  In June 2016, the number of unique mobile visitors was “double” that of desktop visitors (http://bit.ly/2lwrldh).

It is estimated between 2014 and 2020 the number of U.S. smartphone users (all ages) will increase by 50.1% (171 to 256.7 million users; http://bit.ly/2kNL5Io).  During this same time period, the U.S. population is expected to increase by 5.0% (318.7 to 334.5 million consumers; http://bit.ly/2kNI5f2).

Mid-Atlantic wine consumer mobile phone and tablet ownership

In a March 2016 Internet survey, we included questions about mobile phone and tablet ownership and asked our participants, who resided in New Jersey, New York, and/or Pennsylvania and who drank and purchased wine at least once the previous year, how they used these devices.

Of the 714 survey participants, all but seven reported owning a basic phone, smartphone, and/or tablet.  Of those who owned at least one of these devices, 93.6% owned a smartphone and/or tablet and the remaining 6.4% owned a basic phone (Figure 1), with 41.6% of these participants responding that they owned a tablet.

screenshot-2017-02-15-15-16-16

Though we did not ask about participants’ mobile tablet or smartphone plans, it can be assumed that some of these participants had a mobile data plan for their tablets.  In 2015, 31% of tablet owners had such a plan (http://bit.ly/2kyLbCS), and some cell phone carriers now offer unlimited or free data plans.  It is projected that by 2020, 66.2% of Internet users will use a table “at least once a month,” a 10.4% increase from 2012 (http://bit.ly/2kyLRYS).

What do smartphone users do on their devices?

Responses to an August 2016 survey involving adult smartphone users, age 18 and older, indicated that on a weekly basis they used their phone to:

  • “access the internet” (93% of participants),
  • “take photos/videos” (71%),
  • “receive SMS/text alerts” (68%),
  • “look up directions” (58%), and
  • “research products” (47%) (http://bit.ly/2lo3lft).

Pertaining to shopping and using a smartphone to make a purchase, there was a nearly equal split between the percentage of respondents who made a “majority” of their smartphone purchases using a mobile app (51%) and who used a mobile website (49%) (http://bit.ly/2lvo65J).

Segmenting data based on demographics reveals:

  • 3% of participants in one survey responded that they made a purchase using a smartphone in 2016, with slightly more female participants making a purchase than males (45.3 vs. 39.9%, respectively) (http://bit.ly/2lvo65J).
  • In 2016, Over half (63%) of Millennials shop on their smartphones every day but fewer, 39%, actually make the purchase on their phone (http://bit.ly/2loGXmh).
  • In 2015, 55% of Gen X shoppers used their smartphones to “locate store/hours,” 54% to “browse products,” and 44% to “get text offers” (http://bit.ly/2lnPS7h).

When asked what prompted them to make a purchase on their smartphone, 21% responded that they made a purchase after receiving a “marketing email about” the product, 18% a “marketing text,” and 17% a “marketing push notification” (http://bit.ly/2lvo65J).

Mobile Apps

Mobile app usage “accounted for 80% of all growth in digital media engagement” between June 2013 and June 2016.

Adults, age 18 to 44, spent more time accessing the web using a smartphone app than they did all of the following options, combined: desktop web browser, smartphone web browser, tablet app, tablet web browser.   How long did these survey participants spend using apps?  During an average month:

  • Smartphone users age 18 to 24 years spent an average of 93.5 hours using smartphone apps,
  • users age 25 to 34 years spent an average of 85.6 hours, and
  • users age 35 to 44 years spent an average of 78.8 hours (http://bit.ly/2lwrldh).

If we take the number of hours in a year and divide that number by 12, there are approximately 730 hours in a month.  So, these consumers were spending between 10.8% and 12.8% of each month accessing content via smartphone apps.

Our participants’ mobile wine app usage and what winery and tasting room app features appeal

One component of our second March 2016 Internet survey focused on whether our participants installed wine apps (e.g., Delectable, Hello Vino, Drync, Wine Enthusiast’s Tasting Guide) on their smartphones and/or tablets and used the app(s) to learn about wine and/or winery tasting rooms.  As is shown in Figure 2, below, 26.7% of smartphone and/or tablet owners responded that they did have an app installed on their mobile device.

screenshot-2017-02-15-15-16-27

 

All participants who owned a smartphone and/or tablet, regardless of whether they had a mobile wine app installed on their device, were also asked to look through a list of features commonly found in wine apps and select up to five they felt would be useful to incorporate into a winery tasting room app.

Responses are ranked based on the number of participants who selected each, with “location, service, direction, and/or map to the winery tasting room” selected by the greatest number of participants (Table 1).  “Detailed list of events held at the winery tasting room” along with details specific to the occasion (date/time, performer, entrance fee, etc.) and “tasting room sales announcement/digital coupons for tastings and/or purchases” were ranked second and third, respectively.

screenshot-2017-02-18-08-46-20

Even through 73.3% participants indicated that they did not have an app installed, we included responses from all of our smartphone and/or tablet owners in Table 1.  It is possible that one of the reasons why participants had not installed a mobile wine app was because they didn’t like the features.  Hence, we feel it is of value to provide all the data as their responses pertained to features that could be incorporated into a winery tasting room app, rather than an app offered by a corporation, magazine, etc.

While the data is specific to mobile app features, knowing what features appeal to mobile device owners could be useful when developing or revamping a mobile website.  Responses may help tasting rooms identify content that they had not considered for their website or help with prioritizing content.

So, should you develop an app for your winery tasting room?

With data showing that smartphone and tablet ownership and app usage is increasing, is it time that you invest in your own winery and tasting room app?  While it may seem that an app would simply duplicate what your mobile website does, according to one expert “mobile apps…are best suited for user retention and engaging with clients.  They’re not aimed at random people finding a company’s website, but are more about rewarding loyal customers” (http://bit.ly/2kXrxUp).

Benefits a small business may experience if they develop their own app include:

  • an additional way to communicate with customers, another channel for them to make purchases, and gather user data (depending on the app’s capability and features) such as “visits, checkouts, purchases, searches, and more” (http://bit.ly/2kXsxI9);
  • being able to reward users, be the method for recording purchases, and display loyalty program status and level (http://bit.ly/2kXmW4G); and
  • serve as a point of differentiation from other winery tasting rooms that do not have their own app (http://bit.ly/2kXnHdS).

One of the biggest cons, if not the biggest, is the cost of building an app.  The costs to build an app depend on what options are selected.  Some of which include:

  • if your app be available to Android or Apple iOS users of both,
  • if and how users login to the app (no login, using their email, or using a social media account),
  • if users will have to create a personal profile,
  • if the app will be free, for a fee, and/or allow in-app purchases (http://bit.ly/2kXrecm).

Also, you will need to determine if you should develop a:

  • native mobile app (written specifically for Android and/or Apple iOS and is downloaded from the App Store or Google Play and are opened by “tapping their icon”),
  • a hybrid mobile app (which is downloaded like a native app but runs off a web browser and can be cheaper to build than native apps), or
  • a web app (a “mobile version” of a website and “loads within a mobile browser” (http://bit.ly/2kXv5X1, http://bit.ly/2kXsZWY).

Perhaps you are not ready to build an app, but is your website mobile-friendly?

While you may be considering the benefits of developing an app for your tasting room, you really need to learn directly from your customers about their interest in downloading your app and what features appeal to them.  Until you have collected data from your customers, developed the app, tested it, made improvements, etc., your tasting room visitors will likely turn to your website to learn about your winery and wine.

In September 2013, we asked Mid-Atlantic wine consumers to indicate what social media networks, email, and online resources they felt were mandatory for winery tasting rooms to implement.  Over half of our participants felt that a “website for promoting the winery and wines produced” was a “mandatory” component (http://bit.ly/2kNy7dI).  Hence, you not only want a website (according to one survey, 46% of small businesses do not have a website; http://bit.ly/2kNPwTE) but you want one that functions properly and is mobile friendly.

A website that is not mobile-friendly not only frustrates visitors – it may also negatively impact your Google mobile ranking (http://tcrn.ch/2kWN4ws).  Since 2014, Google has been focusing on the importance of having a mobile-friendly website, and that having one provides the consumer with a better experience (http://bit.ly/2kX1YmB).   So, if your website is already mobile-ready then it may “appear higher on search results” (http://bit.ly/2kWUEaI).  Keep in mind that a mobile-friendly website is just one factor than can impact Google mobile rankings (http://bit.ly/2kOhhLK) and that the algorithm pertaining only to Google searches on mobile devices (http://bit.ly/2kX3PrB).  Based on analyzing their customers’ websites, Hubspot.com estimated that the 2015 update resulted in “a 5% drop in traffic,” (http://bit.ly/2kWX0pK).

Fortunately, there are several websites and online tools that identify issues that make a site less mobile friendly.

We tested these tools/sites to see what type of assistance they provided.  We used an URL from a winery that had just updated their website design and that was well designed for desktop viewing.  While we only mention a couple of tools, you will find more online by searching for “mobile ready website tests.”

The first tool we used to check if the website was mobile friendly was developed by Google: (http://bit.ly/2loAxmX).   To test a web page, simply copy and paste the URL into the textbox on the site, click “run text,” and wait.  You will then be directed to a page with your results.

Although we got a message that “this page is easy to use on a mobile device,” and it looked great when we compared the mobile version to how it looked on my desktop, there was an alert.  Two of the resources on the site were “blocked,” which are “external resources­–such as image, CSS, or script files” (http://bit.ly/2loHFzP).  A blocked resource could have minimal impact or if it is a “blocked CSS file [this could] result in incorrect font styles being applied…[which] affects…Google’s ability to your page” (scan your web page and create an index of all the words on the page, which then determines the order in which web users see them; http://bit.ly/2lXtaQq).

If your web page is not mobile-friendly, you will be alerted to whether the errors pertain to Flash usage (“content, animations, or navigation” not being displayed) the content not sized to viewport (the viewer would need to scroll horizontally to see all the content on their mobile device), and/or others (http://bit.ly/2lXN3qG).

We also tested the website with another mobile-friendly tool, mobiReady (http://ready.mobi/), and learned that though 23 of the web page components (e.g., cookie size, applets, and image resizing) “passed” the test, nine had “minor fails” (e.g., popups, JavaScript Minimize), and six were “major fails” (e.g., caching control, JavaScript placement).   After clicking each minor and major fail I learned why the component was considered a failure and I learned “how to fix it.”

Click on the following link to learn how “not being mobile friendly” can cost you: http://bit.ly/2kWOIOS.

A little bit more about texting customers

While basic cell phone owners have limited access to some applications and mobile websites, they still can be used to communicate with wineries and tasting rooms and receive promotional messages, shipping notifications, and other communications that tasting rooms send via text.

In a January post, Kathy provided information about why you might want to consider using text messaging to connect with your customers (http://bit.ly/2lktAma).  While the data discussed in that post were based on consumers in general, we asked in our March 2016 survey if Mid-Atlantic wine consumer were interested in receiving texts from wineries and tasting rooms.

With nearly all (95.3%) of participants owning a smartphone and/or basic phone, and proposing that these phones can accept text messages, over half (53.2%) of participants would be interested in receiving text messages from a winery tasting room that contains information about events, wine tastings, new wine releases, etc. (Figure 3).

screenshot-2017-02-15-15-16-41

Take a look at the post to learn why consumers were interested in communicating with businesses via text and how to use texting to engage with tasting room visitors.  If you need some ideas as to what to include in the message, a simple Internet search for “sample text messages to customers” can lead to several sites with examples and templates (e.g., announcing that your website is mobile-friendly http://bit.ly/2kXnKqj  and asking visitors to comment about their recent tasting room experience http://bit.ly/2kX5uxi).

screenshot-2017-01-26-08-59-39

 

What Drives Mid-Atlantic Wine Consumers to Visit Local Winery Tasting Rooms

By Jennifer Zelinskie and Dr. Kathy Kelley

Whether you work in the wine industry or are just a wine consumer who reads the Wine & Grape U. Blog, you have probably visited many different winery tasting rooms. Reflecting on these visits, you probably remember instances when you had an exceptionally good experience and times when your visit might not have been all that delightful. We are pretty sure that you made the decision to return to the facility while tasting the wines or just after the door shut upon your exit.

If you are a winery tasting room owner or operator, you want all of your customers to have a memorable positive experience and have no doubt that they will visit again. This blog post presents data collected from our Mid-Atlantic wine consumer participants as to what had a positive influence on their willingness to visit again.

The Impact of Customer satisfaction

Customer satisfaction is critical to the success of any business. Miguel Gomez, a faculty member at Cornell University, shared five factors that drive customer satisfaction, builds loyalty, and encourages repeat winery tasting room visits. These include:

  • ambience – cleanliness, ambiance, lighting, sounds, view, etc.;
  • service – staff friendliness, knowledge, appropriate appearance, and helpfulness;
  • tasting protocol – variety, amount served, cost, and number of wines tasted;
  • tasting experience – flexibility in choice of wines, space (crowdedness), waiting time to start and between samples; and
  • retail execution – presentation of wine for purchase, quality, prices, discounts, and ease of locating the winery (http://bit.ly/2jy3v2C).

According to data collected as part of the Northern Grapes Project, funded by the USDA, the average number of bottles study participants purchased increased as customer satisfaction increased. Participants were asked to rate their “level of customer satisfaction” in tasting rooms on a scale of 1 (lowest level of customer satisfaction) to 5 (highest level). Participants that rated their tasting room satisfaction level a ‘4’ out of ‘5’ purchased an average of 2.8 bottles of wine, but those who rated their tasting room satisfaction level a ‘5’ out of ‘5’ purchased an average of 4 bottles (http://bit.ly/2k5gG7L). Average amount of money spent at the tasting room also increased as level of customer satisfaction increased. Those who awarded ratings of ‘4’ out of ‘5’ spent an average of $40 and those who awarded ratings of ‘5’ out of ‘5’ spent an average of $60.

How far did our participants travel to winery tasting rooms during an average year?

In our March 2016 survey, participants were asked if they visited and/or purchased wines from winery tasting rooms that were located within 100 miles from their home during an average year. Of the 1,038 participants, 505 (50.1%) responded “yes.” These 505 participants were then asked a series of questions regarding their winery tasting room visits.

Why might purchasing wine from a tasting room be more appealing than purchasing wine from a retail liquor store?

As a winery tasting room owner you want your customers to come and visit your location, taste your wine, and make purchases on a regular basis. Yet one of your major competitors is the local liquor store, which can be more convenient (e.g., hours of operation) for consumers and provide them with a greater selection of wines (e.g., type, origin, price) than you offer.

Hence we asked our participants who visited winery tasting rooms within 100 miles of their home to react to factors that may have influenced them (positively and negatively) to travel to a tasting room, rather than a liquor store, for a visit and/or to purchase wine. Data presented below (Figures 1 through 3) are for the 95.6% of participants who indicated that at least one factor influenced them in a positive way to travel to a winery tasting room to visit and/or make a purchase. We will discuss factors that had a negative influence in another blog post.

Factors that Had a Positive Influence on Participants’ Visits and/or Purchases

As you can see in Figure 1, below, nearly half of the 505 participants selected “prefer to purchase directly from the winemaker” (48.6%) and that “purchasing wine directly from the winery tasting room provides more support to the local economy” (47.9%) as having a positive influence on why they traveled to a tasting room within 100 miles of their home to make a visit and/or purchase wine, as opposed to a retail liquor store. We chose the 100-mile distance as 64% of participants in one study responded that for a food to be “local” it had to be produced within a 100-mile radius “of the store” (http://bit.ly/2jxi1VO), and there are reasons why you might promote your tasting room as being a local wine source.

screenshot-2017-01-26-10-42-27

Individuals who buy wine from local wineries may do so because they feel a sense of community when they make the purchase. Others may purchase local because of economic benefits. For example, when $100 is spent at a local business “roughly” $68 stays in the community while only $43 “stays in the local economy” when $100 is spent at a non-locally owned business (http://bit.ly/12cRrXn). Or, they may feel that local foods and local wines are a natural pairing. According to David Page of Shinn Estate Vineyards, though it may take decades or longer, “the wine of a region and the food of a region creates the cuisine of the region” (http://nyti.ms/2kcdVBt).

How can you, as a winery tasting room owner or operator, use the “buy local” trend to engage your customers?

  • Promote your business as being local, that you make your wine locally, and/or that the grapes and other ingredients used in the wine are from local sources. The Hive Winery, located in Layton, Utah, states on their website that their “wines are crafted using fruit and home from local farms as much as possible” (http://bit.ly/2kwO47H). If you look through their website you will learn that the local theme is not just mentioned once, but they discuss why consumers may want to buy local, indicate the ingredients in each wine that were sourced locally (e.g. “11 pounds of fresh Utah black cherries [are used] per bottle” of their Black Cherry Brandy, http://bit.ly/2kx2K6F), and link to other local businesses. Discussing why local, as well as other environmental practices, is important to them helps convey to readers that they are not merely using “local” just to drive sales.
  • Find a “buy local” association, build a relationship with other local businesses, and work together to promote your businesses and the community. In 2013, 14% of independent businesses located in Michigan “Local First” communities indicated that the effort had a “significant positive impact” on their business, 28% reported a “moderate positive impact,” and 33% “a little positive impact” (http://bit.ly/1gcOesa). These businesses reported a greater percent change in revenue in 2013 over 2012, a 7.0% increase compared to 2.3% for independent businesses in communities without a Local First initiative, and a greater positive change in 2013 holiday sales compared to 2012 (http://bit.ly/1gcOesa).
  • Register your business as a “Small Business Saturday” participant (http://amex.co/1JdleC6). This campaign, hosted by American Express, is held on a Saturday after Thanksgiving and encourage shoppers to buy from local businesses. Now approaching its eighth year, 112 million consumers shopped and dined at small businesses on Small Business Saturday 2016, a 13% increase over 2015 (http://bit.ly/2koxVRI). Not only do consumers focus on purchasing from small businesses on this shopping holiday, but 77% of consumers who participated in 2014 survey responded that “the day makes them want to shop local year-round” (http://bit.ly/2jxFO7q). One winery that utilizes Small Business Saturday is North Folk Winery, Harris, MN. Thewineyhosted a wine pairing with local cheese and chocolate and offered attendees a 20% discount on bottles when they purchased cheese and chocolate gift boxes (http://bit.ly/2jxdAKH).

Offering discounts in your winery tasting room can help attract new customers, encourage undecided customers to make a purchase, and prompt those who have not visited your tasting room in a while to stop in and see what is new.

Pertaining to discounts and programs that would provide incentives for purchasing multiple bottles, 40.1% of our participants indicated that such a discount had a positive influence on their decision to travel to tasting rooms, as opposed to a retail liquor store (Figure 2).

screenshot-2017-01-26-10-42-38

Ron Lykins, a wine tasting room associate, suggests in a blog post that offering a discount on purchasing multiple bottles of wine is a reasonable strategy and encourages up-selling. He provides an example where a customer is purchasing four bottles of wine and is then presented with a modest discount if the customer purchases an additional two bottles.  He stresses that the policy needs to be clearly defined and that all tasting room staff must know when it should be offered (http://bit.ly/2j9BLhe).

But why do discounts work in attracting customers to your tasting room?

 The psychology behind discounts is to create urgency. Which can be achieved by:

  • Using phrases such as “get $10 off your case purchase” or “get 5% off a case purchase,” which specify what is actually being discounted, are more likely to motivate people to buy compared to using less direct statements like “save $10” or “save 10%.”
  • Limit the amount of time you offer the discount, preferably no more than a couple of weeks to encourage customers to buy before it is too late.
  • Inform customers about the discounts when they are if your tasting room and through all modes of communication (http://bit.ly/2jA0Cho).

Of the 505 participants who visited and/or purchased wines from winery tasting rooms that were located within 100 miles from their home during an average year, few participants (14.7%) indicated that being a member of the winery’s wine club and earning rewards by making purchases was a positive influence. This low response may be due to the fact that only 20.8% of these 505 participants reported being a club member or subscriber.

Although this is the case for our survey, as a winery owner or operator, you have the ability to customize your reward system and offer benefits that motivate your customers to become members and renew annually. Keep in mind that it is not just the discount that encourages customers to join a wine club, but there are also “intangible” benefits. You have the opportunity to make your club members feel special, whether that means hosting private events or getting to know them by name (http://bit.ly/2j9BLhe), both of which help members feel truly connected with the winery and tasting room staff. You can read more about our participants’ interest in wine club membership benefits by clicking here: http://bit.ly/2iCoulc.

Whether you are offering discounts to all customers or just members of your wine club, consider the following to make sure that your discount does not have a negative impact on your business:

  • Calculate the best discount price that will still generate a profit by understanding your gross margin, markup, and breakeven figures.
  • Know that you will need to increase your sales volume, which differs based on the discount offered, in order to maintain the desired gross margin. According to the example on the Business Victoria website (http://bit.ly/2jIa96k), if your gross margin is 40% and you offer a 5% discount then you will need to “increase your sales volume by 14.3 percent in order to make a profit.” If you change that 5% discount to a 10% discount you will need to increase your sales volume by 33.3%.
  • Become familiar with what discounts other winery tasting rooms in your area are offering. Though your operations may not be identical, this can at least give you some guidance as to what type of discount you might offer, amount of discount to provide, and frequency which to offer the discount.
  • Review last year’s sales and identify times (days of the week, seasons, etc.) when your sales were low and that, perhaps, running discounts during these times could increase foot traffic and boost sales (http://bit.ly/2jIa96k).

Figure 3 shows survey participant responses to the remaining three factors that could have a positive influence on their likelihood to travel to a winery tasting room, as opposed to a retail liquor store, within 100 miles of their home. Over half, 56.6%, of participants indicated that they like to be able to taste all or most of the wine before making any purchases. Half (51.0%) indicated that they like the taste and/or quality of the wine they purchase directly from the winemaker and approximately a third (31.2%) reported that being able to buy wines made with grapes native to their area (e.g., Niagara, Catawba) were reasons why they traveled to the tasting room.

screenshot-2017-01-26-10-42-48You know how wine tastings influence your visitors’ purchasing decisions, and that if you can get a reluctant visitor to try a wine that they are unfamiliar with – you might just get a sale. Whether you currently make wines that are less known or are contemplating doing so, you should consider encouraging as many visitors as possible to sample them.

In 2012, Michigan State University researchers investigated consumer awareness and perceptions of cold hardy grape wines (e.g., Brianna, Edelweiss, La Crescent, Marquette). According to their results, slightly more than half (55.5%) of Michigan tasting room visitors responded that they were not familiar with cold hardy wines, while 65.3% indicated that they had tasted them. An additional mail/email survey was implemented in six Mid-Western states. Awareness was even lower among these wine consumers, with 70% responding that they were not familiar with the wines and only 26.8% responding that they had tasted the wines (http://bit.ly/2jKwLC).

Although awareness of cold hardy wines was low, consumers who had tasted cold hardy grape wine reported to like them “a lot” (41.9% of the MI tasting room visitors and 39.3% of mail/email survey participants) or “a little” (29.9% of the MI tasting room visitors and 31.1% of mail/email survey participants; http://bit.ly/2jKwLC).

Educating your staff about these wines and guiding them as to how they can encourage customers to taste “unknown” or “less familiar” wine is crucial.

Of note….

We recognize that percentages of respondents who indicated that these factors had a positive influence on their winery tasting room visits were not as high as might have been expected. None of the percentages were greater than 56.6%. In the future, we plan to investigate other factors that may have a positive influence on winey tasting room visits.

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2017 Retail Trends For Winery Tasting Rooms To Consider

By Dr. Kathy Kelley

With the New Year just over a week away, the number of reports, articles, etc. that predict what will happen in retail and food trends are filling my inbox and dominating the Internet.  Though overwhelming, I do enjoy sifting through these data and identifying trends that appear in more than one source and that could be useful to tasting rooms in our region.

The one trend that appeared quite frequently was the importance of creating a customer experience.  We have published a couple of blogs about creating an experience, which you can find by clicking on the following: http://bit.ly/2h1dM21 and http://bit.ly/2h1dzLZ.   Since you can refer to these past blogs about how to create an experience for your tasting room visitor, I selected three other trends for today’s post: being transparent, important flavors, and communicating with customers via text.

Transparency

For a few years, consumers have expected businesses to be “transparent” with how they manage funds collected via their cause marketing programs.  Donors want to know how each dollar collected is distributed (http://bit.ly/2i6EdIB).  Some companies want to be transparent in every business aspect and they even make key employee salaries public (http://bit.ly/2i6K7ZY).  Without going to that extreme – what can a business do to meet the desires of their customers who have an interest in learning “where their money’s going rather than simply what it’s buying?”

An example presented in Vend’s 2017 Retail Trends and Predictions report (http://bit.ly/2gUbT74) is Everlane, a clothing business that promotes “radical transparency” (http://bit.ly/2h11bvA).  One of their principles is to be transparent in their costs.

By clicking on a wool-cashmere scarf that they sell, I learned that the true cost ($31.00) was derived from the following: materials ($16.40), hardware ($1.60), labor ($9.65), duties ($2.21), and transport ($1.30) (http://bit.ly/2i22LSR).  The retail price was $65; however, they are primarily an e-retailer, with some product available in boutiques in major metropolitan areas, so they have been able to “eliminate brick-and-mortar expenses and pass these savings on to” their customers.  Consumers and some magazines (e.g., Lucky Magazine, GQ, and Glamour), newspapers (e.g., Los Angeles times, The New York Times), and fashion websites (e.g., Style.com) appreciate this strategy and insight (http://bit.ly/2h3EwPv).

You may not feel comfortable providing a breakdown of why your bottle of Chardonnay costs what it does, but I’m sure that you get asked often why your wine is more expensive than a Chardonnay produced by a “massive conglomerate brand.” Reininger Winery, located in the Walla Walled Valley in Washington State, answered this question in a July 2012 blog post (http://bit.ly/2gV1urD).

Courtney Morgan, Reininger Winery Marketing Assistant, provided information to educate consumers about how factors (e.g. marketing costs, land prices, volume purchases) impact the final price of a wine.  Like Courtney, you probably would make note that “there is no question that a large conglomerate winery can make a good $8 wine,” but that there is something unique and special about the wine you produce and the wine in the bottle reflects the care and attention you take during harvest and the wine making process.

Do consumers get a sense of who you are as a brand?

Most likely your website has an “About Us” page that describes a little bit about your winery/vineyard and the owners.  Perhaps you even have some information about your wine maker or other key employees.  If the descriptions are brief, or merely mention an employee, their name, and their job title, consider adding information that them and who they are as a person.

screenshot-2016-12-21-19-43-02Brancott Estate in New Zealand, which I was fortunate enough to visit a couple of times during my 2011 sabbatical, has taken such an approach.  While a few of the key personnel listed hobbies and what they do on their time off, others described what specific tasks they oversee.

When I clicked on their “About Us” page, I learned that Patrick Materman, Chief winemaker, “decided he would study horticulture at Massey University” at age six, that he was awarded the title of “New Zealand Winemaker of the Year” in 2001, and his job entails “monitoring vineyard blocks, tasting fruit and determining the optimum harvest date.”  Eric Hughes, Winery Manager, is responsible for “turning harvested grapes into wines of the highest quality” and he is the head instructor at the Blenheim Dojo for Seido Karate.

If someone writes your blogs or posts your social media updates and readers merely see their first name in the byline – this could be a missed opportunity.  Wouldn’t you, as a consumer of products and services, what to “know” who is provided the information that you use to make a purchase?

John Morgan, who wrote “Branding Against the Machine: How to Build Your Brand, Cut Through the Marketing Noise, and Stand Out from the Competition” (John Wiley & Sons, Inc. 2012) stated that “What you do may not be unique, but you are.  This is why putting your personality into your brand is so important…Personal brands can coexist with a company brand.”  The author provided examples of businesses, one of which was Ford Motor Company, that does this well.  Scott Monty, head of the company’s social media, does “a good job of letting us know the people behind the logo.  Scott is building relationships with people and is a brand within a brand.”  Lastly, “People do business with people…Today people connect with your personality, content, and values.  Not your product or service.”

Flavors

Throughout the year several magazines, food businesses, chef organizations, etc. develop lists of food trends.  The number of these resources can be overwhelming and some focus on the impact of a specific ingredient (e.g. turmeric, http://bit.ly/2i6KMe8).  I try to find trends that relate to particular types of cuisines and that are mentioned in several reports.  So, what cuisines might we be savoring in 2017?  Mintel, a provider of market research (http://bit.ly/2i6kdWA), predicts the following:

Cuban influenced cuisine

This food flavor trend is expected to gain greater appeal due to the U.S. travel ban to the island being lifted.   Consumers who travel to Cuba for leisure and business and eat Cuban food during their visit may then want to consume these foods when they return home.  Look for foods with rich sofrito sauce (Cuban sofrito is made with tomatoes, red bell peppers, and diced ham and differs from Dominican, Puerto Rican, and other sofritos, http://abt.cm/2i6g7Od) and pork-based dishes.

Korean, Filipino, and African flavors will become more prominent

Korean flavors such as kimchi (fermented cabbage dish made with garlic, salt, vinegar, spices, and chile peppers, http://bit.ly/2i6cJ5V) and gochujang (sauce made from chile peppers, salt, sticky rice, and fermented soybeans, http://bit.ly/2i6o71B) “are becoming mainstream as they are incorporated into everything from Polish sausages to ketchup,” and more Millennials (23%) “want to see more pickled ingredients on the menu, compared to 14% of all US consumers” (http://bit.ly/2i6kdWA).

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Are you familiar with harissa (a chile paste made with smoked peppers, garlic, tomatoes, and a variety of spices and used in North African and Middle Eastern cooking, http://bit.ly/2i6fB2z), teff (a fine grain used to make breads and baked goods and can be steamed, boiled, or baked, http://bit.ly/2i6exM6), or piri piri (peppers used to make a sauce, http://bit.ly/2i6rvtb)?  If not, you may very well see them served in both full-service restaurants and dished out of food trucks.

Fire-grilled or smoked foods

Cooking food in a stove or oven is being overshadowed by consumer interest in foods cooked over a wood-fired grill.  The smoke flavor and aroma “can be incorporated into spreads, desserts, beverages…meats, marinades and sauces” with restaurants using specific types of wood to impart a particular flavor (http://bit.ly/2i6kdWA).

Regardless of whether you have already seen these foods incorporated into menus at local restaurants or if tasting room visitors have asked about possible pairings, now is the time to start developing a list of your wines to serve with these flavors.

Texting

There are several ways that customers can contact you to ask a question about your wine, tasting room, etc., or that you could use to inform them about an event or just say “hi.” Your customers; however, may really appreciate the ability to text message you rather than send an email or call you on their phone to ask you a question.

In 2015, 92% of U.S. adults owned a cell phone of which 68% of them owned a smartphone (http://pewrsr.ch/2iaveGn).  Another survey, administered in late 2014, revealed that text messaging was the primary activity smartphone users conducted on their phone.  Of the survey participants, 100% of those who were age 18 to 29 used their phones to text message (http://pewrsr.ch/2iawoS8).  Nearly all survey participants age 30 to 49 (98%) used their smartphone to text with just slightly fewer participants age 50 and older (92%) responding that they used their smartphone for this purpose.

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If text messaging is the primary activity smartphone users conduct on their phones, might they be interested in using text to communicate with business?  According to a report published by The Center for Generational Kinetics, “some 36% of Millennials say they would contact a company more frequently if they could text them” (http://nws.mx/2h1uNZD).

Why do consumers prefer to send a text to a customer service department rather than call the company?  The top five reasons why U.S. and German consumers preferred text, according to a May 2016 survey conducted by Ovum, were:

  • “less time consuming,” 44% of respondents selected this reason,
  • “more convenient,” 42%,
  • “less frustrating,” 30%,
  • “enabled [them] to ask the company to text/call back,” 26%, and
  • “enabled [them] to have a record of the conversation,” 19% (http://bit.ly/2h1vt1p).

To facility a smooth texting experience, several companies provide 2 Way SMS services that allow businesses to send and receive text messages in real time, send automated replies based on keywords, send appointment reminders, and other communications (http://bit.ly/2h1r3rr).

One such company, SMS Global, a messaging solutions provider (http://bit.ly/2h1m8GT), described some of the things a business can do using 2 Way SMS:

  • Send coupons, offers, and inform customers about sales. SMS Global indicated on their website that “in many cases [their] customers yield a more than 300% increase” in offers and coupon redemptions “compared to email or hard copy offers” (http://bit.ly/2h1r6TW).

An example of a winery that uses text messaging to connect with customers is Chankaska Creek Ranch & Winery, located in Kasota, MN.  The winery uses text messaging to alert customers about the promotions as well as when they release their wines (http://bit.ly/2iaxaOS).

  • Increase email open rates. SMS Global clients experienced a 30 to 40% increase when consumers received a text “prompting [them] to check their email.”
  • Get customer feedback. Every so often, send your customers a text with a question or two and instantaneously learn about their thoughts and interests.

Why might a business want to incorporate texting into their marketing and communication strategy?  Kenneth Burke recently published a list of reasons on the Text Requests website (http://bit.ly/2iakkjA).  Some include:

  • Responding to consumers via text is a quicker way to answer their questions, allowing you to solve a problem before your competitor can, which may result in more sales.
  • According to Burke, “for the average person, texting is one of the more personal things we do every day.” His rationale is that we receive a lot of emails, many of which “are simply marketing and sales messages,” and phone calls, I’m sure that when you see an unrecognized telephone number on your screen that you automatically think that it is a telemarketer.  But, when you receive texts – you know who sent it and these texts are most likely “from people you have close relationships with.”
  • “Texting makes your business fully mobile.” Texting completes the cell phone usage experience.  If a consumer uses their phone to access social media apps, read emails, play games, and a multitude of other activities – then why not reach them on the device that is most likely to be by their side?

Of course, as with any other marketing and communication practice you implement, you will want to make sure that you follow the rules, which include an opt-in consent, directions on how consumers can opt out of text messages, and that message rates may apply (http://bit.ly/2iaFYEC).

We will continue to share trends that could be useful to wineries and winery tasting rooms in the New Year.

Who is the Mid-Atlantic Wine Consumer? Demographics, Behaviors, and Psychographics

By: Jennifer Zelinskie and Dr. Kathy Kelley

Currently, over 100 million people in the U.S. drink wine (vino-california.com). Although knowing and understanding the characteristics that describe the U.S. wine consumer are extremely important, keying in on wine consumers who live in the Mid-Atlantic, and who have better access to wines produced in the region, can provide even more valuable information. Demographics (age/generation, income, race/ethnicity, gender, education and income level, and similar) can help winery and tasting room owners understand “who” their customers are, while behaviors relate to likelihood of using a product (e.g. consumers who drink wine, consumers who purchase wine produced in certain regions) and level of usage (super core, core, and marginal wine consumers), and psychographics (attitudes) describe how consumers “feel” about wine.  Hence, it is important to understand how wine fits within the context of the Mid-Atlantic culture and detect if any subcultures exist that would warrant even more specific marketing messages, promotions (http://bit.ly/2fdAq6B), pricing strategies, and packaging (http://bit.ly/N8jBfo).

According to The Upfront Analytics Team, there are five key ways consumer demographic information can be used in a marketing strategy.  Specifically, to:

  1. understand who the ideal customer is based on their tastes and preferences (e.g. knowing what appeals to super core wine consumers, what Millennials prefer to drink),
  2. lower marketing costs by using the information to target customers more efficiently (e.g. using Facebook as opposed to traditional media to reach younger generations),
  3. identify new opportunities based on gaps in the current marketing strategy (e.g. marketing wine as being sustainable to reach consumers who are environmentally-conscious, marketing low-calorie wines to health conscious consumers),
  4. create unique selling points through marketing stories that appeal to your target customer (e.g. conveying what your brand represents, what makes your wine/tasting room unique), and
  5. better engagement, through the use of steps 1-4, which can lead to increased sales (http://bit.ly/2fdKEE7).

There is no question that knowing specifics about your customer is crucial. Certain segments are more likely to pay more for wine than others, or they may prefer dry/tannic style wines as opposed to sweeter wines (http://bit.ly/2fvApi8). Engaging different age groups can mean utilizing different means of communication or presenting your brand’s message in a unique way. Millennials, for example, love to experiment with wine, are drawn to hip, modern packaging and show very little brand loyalty (http://bit.ly/2fhl8yy).

Description of “Who” Purchases Wine Produced with Grapes Grown in New Jersey, New York, and/or Pennsylvania

Of the 1,038 consumers who participated in our March 2016 survey, 648 of them (62.4%) responded that they had purchased wines produced in at least one of the three states: New Jersey, New York, and Pennsylvania.  This blog post focuses these participants, and we will use an abbreviation to remind our readers when the data presented is for those who were Mid-Atlantic Wine Purchasers (MAWP).

In Table 1 you will notice that slightly over half of the MAWP were female (57.4%) and approximately half lived in New York (49.5%), which is quite similar to the descriptive statistics of all 1,038 who participated in the survey.  We have included these data for consumers age 21 and older based on 2015 U.S. population estimates.

table-1

Other demographic variables that describe survey participants who purchased wine produced from grapes grown in New Jersey, New York, and Pennsylvania:

  • less than a third (30.9%) were members of Generation X, between age 36 and 51, or were Older Millennials, age 27 to 35 years (24.7%, Figure 1),
  • had a Bachelor’s degree (34.9%) or had an Associate’s degree, technical degree, or similar (31.2%, Figure 2), and
  • had an average household income of $76,000 to $99,999 (22.1%), $100,000 to $149,999 (21.0%), or $50,000 to $75,999 (20.5%, Figure 3).

Figures 1 to 3.  Select Demographics (e.g. Generation, Education Levels) of Survey Participants Who Purchased Wine Produced from Grapes Grown in New Jersey, New York, and/or Pennsylvania and All Survey Participants.

screenshot-2016-11-17-10-52-56figure-2figure-3

Other demographic characteristics that described the Mid-Atlantic Wine Purchasers were:

  • 47.5% resided in a suburban area,
  • 70.1% were married or in a domestic relationship,
  • 55.2% had no children living in the household, and
  • 59.8% participant and one other individual in household drinks wine.

Mid-Atlantic Wine Purchasers Consumption and Buying Behaviors

Of our MAWP, 55.9% were “super core,” which is slightly higher than the percentage of all survey participants who were categorized as being “super core” wine consumers (49.3%, Table 2). Participants were also asked to select the frequency that best described how often they purchased bottles or containers of wine. Approximately a quarter (26.2%) of our MAWP purchased wine “two to three times a month” during an average year, which is similar to the percent of all survey participants who purchased wine at this frequency (25.9%) (Table 2).

table-2

What Wine do Mid-Atlantic Wine Purchasers Consume and Buy?

Participants were asked to respond to several survey questions to help identify what wines they consumed most often in regards to level of sweetness/dryness and the type of wine (e.g. white, red).

Based on responses, 35.2% of Mid-Atlantic Wine Purchasers indicated that they preferred to consumed dry wines and an additional 32.9% responded that they preferred to consume semi-sweet wines (Figure 4).  Pertaining to type of wine, 51.5% preferred to consume red wines and an additional 31.8% preferred to consume white wine (Figure 5).

figure-4figure-5

Mid-Atlantic wine purchasers were asked to indicate from which of the three states (New Jersey, New York, and/or Pennsylvania) and other states/regions they would purchase wine for four different occasions (Table 3).  Participants were also asked to indicate which price ranges they were willing to pay for wine produced in the three states for both “everyday” occasions and for special occasions or celebrations (Table 4).

table-3

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Based on this information, Mid-Atlantic wineries and/or tasting rooms could develop specific marketing messages to inform and remind consumers that their wines can be served during special occasions as well as enjoyed “everyday.” For example, they could promote that their wine pairs well with holiday meals, snacks typically served during sporting events (e.g. Pinot Noir with pretzels, Chardonnay with chips & nacho cheese, http://bit.ly/2eHJB3y), and/or desserts/fondue that are often served when entertaining (e.g. Late Harvest Riesling with Plain Cheesecake, http://bit.ly/2fisUYO).

Wineries and/or tasting rooms can also communicate with consumers that their Mid-Atlantic wines could be perfect to give as a gift.  For example, those located near universities, historic areas, etc. and have wine named after the region/activities/refers to the school should remind consumers that the wine could be an appropriate graduation gift or to celebrate occasions associated with the historical sites.  Wineries and/or tasting rooms can also promote the restaurants where their wines are served or tasting room staff can suggest a local BYO restaurant and then recommend one of their wines to pair with the meal.

Data presented in Table 4 provides insight as to what prices MAWP reported paying for all wine they bought, not just wine produced from grapes grown in the Mid-Atlantic, for both occasions.  Perhaps consumers have asked you why wine you (or others in the area) produce is more expensive than similar wines from outside the region.  This is an opportunity for you to inform them about why your price is higher (you produce small quantities of wine, production methods differ from mass-produced wine, etc.).  It may seem redundant or you may feel that your customers are familiar with the reasoning – but consumers need to be reminded (again and again) about your brand/what makes your business different from competitors in order for them to truly remember.

How do Mid-Atlantic Wine Purchasers Learn About Wine?

Participants were asked to select, from a list of 11 sources, all the sources they used to learn about wine.  Or those presented, the top five sources were:

  • friends and/or family (75.8%),
  • wine and liquor stores, including the employees, promotions/advertisements in the store, and/or sent via email or postal mail (65.6%),
  • winery tasting room staff and/or promotional/advertisement in the tasting room, and/or sent via email or postal mail (47.4%),
  • food and cooking magazines (e.g. Food & Wine, Bon Appetite, Food Network Magazine, Cooking Light) (43.2%), and
  • general online search using a search engine (e.g. Google, Bing, Yahoo) (38.6%).

The least selected sources were:

  • television/radio programs (cooking channel, local or national news segment) (21%),
  • local and/or regional magazines (online or print) (18.4%),
  • national and/or local newspaper articles (online or print) (16.4%), and
  • educational classes (e.g. short duration of 1 to 2 hours, long duration of 2 to 8 hours and/or multiple day workshops of 2 to 5 days) (8%).

It is important for wineries and/or tasting rooms to understand which sources consumers use to learn about wine. Not only are these sources helpful in determining where to place advertising and promotional messages, but to provide information that the source can then use to inform consumers about wine, pairing suggestions, how to store wines, etc.

How Can a Winery and/or Tasting Room in the Mid-Atlantic Region Apply This Information?

Knowing who purchases wine made from grapes grown in the three targeted states (New Jersey, New York, and/or Pennsylvania), prices participants paid for wine in general and what wines (sweetness/dryness level and type of wine) they prefer, among other data presented, can help wineries and/or winery tasting rooms develop more appealing products and better targeted promotional messages. In upcoming blog post we will continue to present data that describes the behaviors and psychographics of the Mid-Atlantic Wine Purchaser, as well as other segmentations that we feel will be valuable to wineries and/or tasting rooms in the region.

Additional Researchers & Jen Zelinskie’s Thesis Advisory Team:

  • Denise Gardner, Extension Enologist, Department of Food Science, The Pennsylvania State University
  • Ramu Govindasamy, Professor, Department of Agricultural, Food and Resource Economics, Rutgers University
  • Jeffrey Hyde, Professor, Agricultural Economics, The Pennsylvania State University
  • Brad Rickard, Assistant Professor, Charles H. Dyson School of Applied Economics and Management, Cornell University
  • Karl Storchmann, Clinical Professor, Economics Department, New York University; Managing Editor, Journal of Wine Economics
  • Michela Centinari, Assistant Professor of Viticulture, Department of Plant Science, The Pennsylvania State University

The project “Developing Wine Marketing Strategies for the Mid-Atlantic Region” (GRANT 11091317) is being funded by a USDA Federal-State Marketing Improvement Program grant, whose goal is “to assist in exploring new market opportunities for U.S. food and agricultural products and to encourage research and innovation aimed at improving the efficiency and performance of the marketing system.”  For more information about the program, visit http://www.ams.usda.gov.