But there has always been one guy who has consistently thought differently about “word of mouth marketing” in general and social media marketing in particular. His name is Jim Novo, formerly of Home Shopping Network, and his blog, Marketing Productivity, has long been my sekret weapon.

In his latest post Jim talks about some recently released research he reviewed for the Web Analytics Association. The paper in question is titled Firm-Created Word-of-Mouth Communication: Evidence from a Field Test. It was published in Marketing Science, Vol. 28.

His takeaways from the research are powerful and counter intuitive. In his review he asks and answers two important questions any winery marketer needs to consider before she can conduct a successful paid social media campaign:

1. What kind of WOM maximizes incremental Sales?

and

2. Which people are most effective at creating the WOM above?

Head on over to his blog to find the answers to these important questions.

They’re probably not what you think.

UPDATE. See also: 84% of social media programs don’t measure ROI

As a firm believer in the power of social media as a way for my proto-winery to create relationships with folks who might one day buy my wine, I’ve been disappointed at the lack of rigor many in the industry are applying to their social media efforts.

Even the guys who “get” it, the software and web developers who are enabling wineries to track the online chatter and engage, aren’t building into their systems an easy way for wineries to measure social media’s ability to meet objectives.

Some of the objectives are la-la woo-woo, granted. How do you measure brand affection? No clue here either. But owners and marketers drool over the type of brand affection that, say, Apple has because of one thing: it sells products! And they know it sells products because they measure it.

And you can too. It’s easier than ever to do it online.

Instead of boring you with theory and formulas, let me just tell you my story.

Pinotblogger and the Bankers

I recently presented my business plan to a Senior VP at a local bank specializing in wineries. The economy is in the crapper, uncertainty is high, and so you might be forgiven for thinking that now is the worst. time. ever. to spend a lot of money on a capital intensive process like building out a winery.

But you’d be wrong. Dead wrong. Prices on materials are the lowest they’ve been in a decade. Interest rates are the lowest they will ever be (the Fed can’t go below zero – at least I think they can’t). The SBA program has waived all their fees for the year, and you can roll capital purchases (tanks, presses etc.) into the building loan if you qualify. Demand is there, and quantifiable, due to Capozzi being a social media success in the wine space.

By the time construction is completed, say next spring fall, we’re still 18 months from a release. By the time we are ready to sell, my bet is – and most other economists are with me on this – we will be well into the recovery phase of the downturn.

Or maybe you believe Obama is actually an alien sent here to sate the masses into socialistic complacency and to pave the way to the complete enslavement of the human race by a new ruling class of martian overlords.

Either way, its still a darn good time to make tasty drinks that make you feel funny.

Now is the perfect time to build a winery.

The Narrative and the Numbers

The above is the narrative, and it’s a very good one. But it’s still just a narrative. And in terms of how wineries go about measuring the value of social media, that’s about as far as they go: a narrative of how interactions are happening. We’re on Twitter! And we have followers!

What is missing is a clear enumeration of the objectives. Me, I want to sell wine. Since I haven’t yet, I use other metrics to help me determine how successful my Adventures in Social Media have been. They aren’t complicated, but they require me to know what I want to measure, to actually measure it, and to do an analysis of what works and what doesn’t.

Here is a simple, but very illustrative example. We’ve had over 1200 sign-ups to our inaugural vintage mailing list. Growing this list is my single most important objective online. I’m going to be going direct after all. There is nothing else that even comes close.

This is my 349th post to pinotblogger. That means, on average, each time I post I earn 3.5 potential customers. Taking this analysis a step further (and I have) I can project how many on the list will buy, and what their average purchase over a year will be. I take this number, multiply it by 3.5 and – boom! – thats how much a post to pinotblogger is worth, on average. Subtract my time (which I can choose to value however I want, since I’m not paying anyone to write for me) and the monthly hosting fees and I have a pretty clear picture, much more than just a guess, of what kind of value I’m getting from blogging (note: there is much more to this – lifetime value of a customer, building loyalty etc.).

Word of mouth should be treated the same way: you must walk back the cat – all the way! – to an objective. It could be a speaking appearance at a conference, it could be a consulting gig, or it could be part of a strategy to ratchet up coverage of your winery to more widely read media. And then the process starts again for each of those intermediate objectives. What did you want to accomplish? Did you meet those objectives?

If you aren’t measuring and tracking your social media, then you’re treating it like advertising. And advertising is all about the number of impressions. If you do view things this way it leads to two key implications due to the limited reach of social media vs. mass media, neither of them good:

1. It will take a long time for your social media advertising to build up enough intent in your target audience for you to see any lift (forgive my slack-jawed decent into 20th century advertising jargon).

2. You’ll become the worst possible thing in the entire marketing world: a spammer. You’ll be pounding your keyboard in some neanderthal attempt to get lift by increasing impressions on a small group of viewers. Your followers will hate you, you’ll hate yourself and eventually you’ll want to take your toaster in the bath.

There’s more to say, but not right now. Right now I have to get back to polishing my business plan. But if you found this post useful and want more, feel free to drop me a line. josh@pinotblogger.com.

That’s one of the questions David Williams poses in the latest issue of Wine and Spirit (UK). After taking the reader on an extensive survey of the past and present of online wine retailing, David asks whether the current buzz about wine/web 2.0 is fundamentally different from previous wine e-tailer failures.

Looking forward, David identifies direct-to-consumer as the third revolution in online wine sales. I think he’s absolutely right (I’d better, I’m betting our winery on it!). But he also thinks that direct-to-consumer sales will come at the expense of wine retailers and merchants, and Capozzi (that’s me) is held up as an example of a producer embracing the model and looking to cannibalize sales from clicks and mortar wine retailers.

Here’re some quotes for context:

…[A]ccording to Gormley, there is much more to come from the web.

“I think we’ve got an awfully long way to go,” he says. “What’s happened online so far has basically been improvements on the existing models of direct selling. But the real step change is still to come.”

Gormley reckons the seeds of revolution lie in the ability of consumers to make direct contact with their favoured producers, and to buy their wines directly from them – a kind of virtual farm gate, leaving retailers to act as “sourcing partners who basically just do the logistics”.

A virtual farm gate. I love that image. Rusty, creaky gate hinges and all. It conjures up the kind of one-to-one opportunities that direct interaction with wine lovers provides. Drop on by, have a chat. Maybe buy some wine. Lovely. Serene. Downright agrarian. Which is why the following juxtaposition is a bit jarring:

It’s a model that appeals to forward-looking producers such as Josh Hermsmeyer in California’s Russian River Valley. Hermsmeyer is well-known in cyberspace as the man behind the thoughtful pinotblogger site, which tells the story of his attempts to build his Capozzi family winery from scratch. And he is convinced that, for boutique fine wine producers if not bigger brands, the possibilities afforded by the internet could make fine wine retailers a thing of the past.

So, just for the record, I never said that I think fine wine retailers would be a thing of the past. It’s an interesting idea, but one that I completely disagree with, as you’ll see below.

I simply think that distributors and unnecessary middlemen that add no value will become a thing of the past. And even then, as David notes, I was only talking about small wineries. Big producers will always need distributors to move the volume of wine that they produce. For them, the distributors add value.

So Jill and all the rest of the awesome fine wine retailers out there, you can put down your knives.

More quotes:

“It seems to me that the change really will be at the high-end,” Hermsmeyer says. “Using social media, wine lovers who want low volume, artisanal wines will be able to go straight to the source and easily interact with the principals behind their favourite winery.

“Since the time and effort it takes to cultivate real, meaningful relationships with people doesn’t scale, I think this is where the small guys have a pretty sizable advantage over the big ones. Our customer bases are much smaller, so more personal attention can be paid to the folks who are truly passionate about our brands.”

Not everybody believes this is the future of wine retailing. As you might expect, Bennett thinks otherwise, and says: “There will always be a role for people like us who can give their authority on what we consider to be the best wines around. It’s very hard to buy direct in Burgundy, for example, unless you know your stuff.”

Bennett is absolutely correct. There will always be a role for people who have built up authority and trust with consumers to use their influence to recommend good wines. The wine world is way too cluttered and complex to navigate without some guidance. That guidance could come from a friend, a sommelier, a professional reviewer, a wine blogger, or a retailer. All of these folks add tremendous value. So, as long as the wine world stays complex and cluttered, they won’t ever go away.

More than that though wineries that rely on direct to consumer sales to make their business work would be foolish to view fine wine retailers as anything other than partners. Third party recommendations are crucial in the wine industry, and having a brand advocate that also happens to sell your wine is a powerful thing. Their passion and knowledge of wine will attract consumers and will help you grow your brand.

And as far as the internet goes, online tools are making it ever easier to create profitable relationships with such partners.

Retailers and Wine Bloggers as Partners

As just one example, imagine if every wine blogger suddenly became a tiny equity partner in your wine brand. If someone likes your wine enough to write about it, shouldn’t they be able to monetize their influence and get a cut of any sales that resulted from their recommendation? Isn’t this precisely what wine retailers do offline right now?

This isn’t a new idea, and it isn’t hard to implement. In fact I wrote about how to do it almost two years ago. People do it all the time with goods on Amazon. It’s called an affiliate program, and the web makes setting up such a system shockingly easy.

What’s holding back such a system from taking root doesn’t have anything to do with technology or the internet. It has to do with many wine bloggers viewing themselves as independent wine reviewers instead of independent wine retailers. The dominant wine blogging model is to be a small scale Robert Parker instead of becoming a small scale Kermit Lynch.

No Mini Kermit Lynches? Why?

Both Parker and Lynch have an unquestionable passion for fine wine. Both have acknowledged expertise. Both are well respected. So why aren’t there more mini Kermit Lynches out there?

No one who has spent the time to build up credibility with their audience is going to squander it by recommending a crap wine just to make a few short-term bucks. And if they do, they’ll quickly lose their influence and readership anyway. The blogoshpere is self-correcting.

So what gives? It’s a rhetorical question obviously, because I really don’t know the answer.

All I do know is that direct-to-consumer will be much more profitable for wineries if they can build their own Long Tail network of micro-retailers and blog partners.

And that means partnering with wine retailers of all shapes and sizes, both online and off, not trying to kill them.

That’s my take at least. What do you all think? All comments welcome.

The paradox is that to get the third thing, you need to put the first two in jeopardy.

Chateau Petrogasm, a blog that reviews wine using only a single picture, is doing the third thing very well. Among wine review sites it’s unique.

Below are its two most recent reviews. Taken together they’re edgy. They have the potential to offend someone other than just the wine producer, which is an interesting switch. But enough talk, have a look for yourself:

2001 Domaine Drouhin, Le Montrachet, Marquis de Laquiche ($370)

and then:

2004 Sequoia Grove Cabernet Sauvignon Napa Valley ($35)

Now, after you choke down your guilty little chuckle, appreciate what Ben and KIH (the respective authors of the posts) have achieved here. There’s some humor, sure, but unlike some of their other work the messages here are instantly recognizable and understood. They’re powerful.

I’m pretty sure regular folks have become numb to written wine reviews. You can only hear “aromas of strawberries and sour cherries” so many times before it loses its meaning. Not only are Chateau Petrogasm’s good reviews different enough to cause you to pause, they’re written in the universal language of images. And what I like best about this pair of reviews is that they’re self-referential. Knowing about the first makes the second even better.

I think wine producers and wine marketers should pay pretty close attention to pictorial reviews and what they’re doing at Ch. Petrogasm.

To explain why, let’s take a trip down memory lane.

Some Historical Context: The Evil Cigarette Marketers

There’s a marketing cycle for products, and cigarettes are probably the perfect case study to understand it. When cigarettes were new, the marketing focused on features and enjoyment – how the coffin nails tasted. The pitch focused on direct benefits.

Then, when the people grew tired of hearing about features, they switched to “mechanisms,” or points of differentiation.

Cigarette marketers even tapped into the growing trend of women smoking and did their part to tip the scales, helping make it socially acceptable for women to smoke with the famous line “Blow Some My Way.”

These ads were more focused on image, something for people to identify with, rather than persuasive copy.

Or my favorite:

Yes, the headline reads “Blow In Her Face and She’ll Follow You Anywhere.” Madness.

Finally, they moved to ads without any words at all. Using motivation research, they discovered that by using visual identifications they could say things that would be impossible to effectively convey using copy. They gave us the Marlboro Man.

They made millions. But even this got tired after a while, and the cycle started all over again with direct claims about flavor and satisfaction.

There’s a twist though. After years of seeing the Marlboro Man marketed at them from magazines and billboards, citizen-marketers started to use the Marlboro Man image as a weapon against smoking.

These bits of anti-marketing are the strongest of all. We got as smart as the advertisers.

So, What’s All This Have to Do With Wine?

In a lot of ways the product marketing cycle described above has been done for us (the wine producers) by professional wine reviewers. We’ve got Parker and Wine Spectator pitching wines on taste and the 100 point “mechanism.” We’ve got Allen Meadows focusing on tradition and the terroir angle.

Since we can’t legally talk about the health benefits of red wine (though media reporting helps), we’re left with flavor, terroir and lifestyle. Pictures of vineyards and blurbs from wine reviewers. But people have seen all this before. I need a new way to get their attention, and so do you.

That’s why images like those at Ch. Petrogasm could potentially be so powerful. Strong imagery is easily understandable, and highly marketable. If you get a positive AND creative review from them, it’s like having Leo Burnett working for you, for free. Minus the sleeze.

Check them out. They’re doing some very creative and interesting things and could use your support.

And the sole purpose of this sentence is to get you to read the next.

This axiom was made famous in direct marketing circles by Eugene Schwartz.

It’s the same with wine. The point of getting someone to buy your wine today isn’t so that you can count your cash and call it a day. It’s to get them to purchase another bottle of wine in the future.

The ReThink blog has a good post up about conditioning your mailing list customers to buy more wine after receiving their wine club shipment.

I made an argument about direct package design based on this principal in the latest issue of Wines and Vines. Delight your customers into purchasing the next bottle, and there will be Good Times.

Orbital collapses into administration.

The worst news to come out of this is that the folks with the company (10 of them) have all been laid off. The somewhat better news is that there is still a chance that the business might still be sold and the brand will live on. That’s still not very good news, but at least the ownership group may be able to pay off their creditors and meet their near term financial commitments.

As Robert writes, this is a sad day for wine marketers, particularly people like me with winery blogs interested in social media. Stormhoek has long been the poster child for online and social media marketing success in the wine industry. They’ve won awards, gotten national media attention, more than doubled production and landed large accounts, and I’ve personally held them out as a case study in my talks on wine marketing.

So what went wrong?

I have an email in to Hugh, who I’m sure has had better days, so I wouldn’t be surprised if I don’t hear back from him. Anyone else associated with Stormhoek is welcome to email or call me if they feel like talking about how things unfolded. All I know from the article is that an unnamed source mentioned that “mistakes were made,” and that a major retailer delisted Stormhoek recently because of “a lower retail price available to a competitor.”

Does Social Media Work For Wine?

At this point I think a fair question to ask is: Does this mean that social media, blogs and other internet-centric marketing are a poor fit for the wine industry?

No, I don’t think so. There is more doubt than there was yesterday, certainly, but a number of factors specific to Stormhoek still lead me to believe that there is great potential for (at the very least) small wineries online. Here they are, off the top of my head.

1. Stormhoek is exclusively a retail brand. They offer consumers no way to buy direct. Simply put, direct sales are really the only way to make the economics of wine production work. In most cases, producers that rely on distributors to get their products to market – and then further rely on large retailers to move that product – will have to deal with constant pressure on their margins. There really isn’t a huge amount of money to be made in the wine industry in the first place, and when you can’t supplement your income with at least some high margin sales, business can be get ridiculously difficult.

2. Stormhoek’s price point put it in a class wine marketers refer to as the “fighting varietal” category (around 10 bucks a bottle). In this market segment price is a huge issue for consumers who are looking first and foremost for value. You’re competing directly with a market that is dominated by Yellow Tail types and that is often undercut during periods of high grape supply, ala 2 Buck Chuck. It’s challenging, and creative marketing and branding pays the least dividends in this segment since consumers are not very brand loyal, and you need a lot of them.

3. Stormhoek doesn’t have famous “terroir.” They knew this going in, and Hugh put a brave face on things very early on. In fact it was the only point in the Stormhoek guide to blogging that I disagreed with when Hugh first published it.

Take us for instance. We share a property line with one of Kistler’s vineyards, and across the street is one of the first vineyards planted in the Russian River. Dehlinger is located just down the road, Rochioli just across the river. These things are easy to understand, help place us in the world of wine, and become part of the story people tell about us. I think this quote from Principals and Practices of Winemaking is still pretty relevant:

“It is usually easier to succeed as winery number 50 in a famed district than number one in an unknown area.”

Terroir may be old world marketing, but it is extremely effective marketing nonetheless. Importantly though, terroir is also mutable, and a few 90+ point scores can create interest where there once was none (see Isreal for instance). Terroir won’t sell your wine for you, but it helps immensely if you have it.

So there you go; my attempt at putting lipstick on this pig.

I’m still optimistic that blogs and new media hold great promise for wineries focused on developing relationships directly with customers and selling their wines direct. In fact, I think that small wineries have a huge advantage over large ones in this area, which is a nice change of pace.

I also think that efforts by people like Tom Wark and Free the Grapes to liberalize interstate commerce laws for wine shipping are crucial to the success of direct. And since the future is direct, then small producers absolutely must have unfettered access to markets.

I’m convinced it’s the only way most of us will survive.

UPDATE: A comment on Tim’s post on Winecast from a Stormhoek employee caught my eye.

Hi Tim,

Hope all is well, just to let you know the problem wasnt with the stormhoek profit margins or much at all to do with Stormhoek, the problem was that they had several other wine brands in the stable that were not making money and Stormhoek alone couldnt make up for the losses occured from the these other brands.

Chris

Sounds much much better than what the article linked to above was saying. If indeed the problems were with their distributor only, then Stormhoek should be fine when they find a suitable partner. I just wonder how the article could have gotten the part about them selling off the Stormhoek brand so wrong.

Dumbfounded, I had to seek assistance. Here’s the conversation that ensued:

Josh: you’re a lawyer, can you explain this? http://www.flickr.com/photos/50783537@N00/2125978368/
Ken: lol
Ken: whah
Ken: what are they offering?
Josh: i have no idea
Josh: drool is forming in the corner of my mouth just looking at the copy
Ken: half off
Ken: buy 2 get 1 free
Ken: i think
Josh: buy 2 of what?
Ken: 2 double deal sandwiches
Josh: you’re not getting a double deal for free
Josh: you’re getting something else for free…
Josh: “buy a double deal, then get a free single deal”
Josh: so is that like buy 4 get one free?
Ken: 3 for 2
Josh: so, there are double deal sandwiches
Josh: and single deal sandwiches
Josh: and if I buy 2 double deal, I get a single deal?
Ken: still that agency should be fired
Ken: it would make sense to people if the double deals were around, but they’re new
Josh: but what is the double value menu?
Josh: is that the same as the double deal? or different?
Ken: double deal sandwiches are on the double value menu
Josh: which is new?
Ken: the menu is
Josh: …no no the single deal is on the double value menu.
Josh: which of course makes perfect sense
Ken: so, when you buy a “2 for” for $x.xx, you get a free item off their single deal menu
Josh: no that cant be right. the single deal is ON the double value menu
Josh: read the first two lines
Ken: there are going to be single and double deal items
Ken: here you go: “Buy one for double price, get one free.” from the comments on Flickr.
Ken: funny

———

Josh: did you count how many sandwiches and hot dogs are pictured?
Ken: more than 2
Josh: makes no sense
Ken: totally not
Josh: “2 for” double deal sandwich?
Josh: wtf
Josh: I’m scared and confused
Josh: the fine print says “2 for” sandwich prices may vary
Ken: maybe its like wendys
Ken: double and single burger
Ken: so on the double value menu, you get 2 sandwiches for $x
Josh: no
Josh: because the single deal is on the double value menu
Josh: says so right on the second line
Ken: thats what i’m saying
Ken: both double and single deals (referring to number of patties) are on the double value (or 2 for) menu
Josh: thats the theory you’re going with eh?
Ken: look at the pic
Ken: the front ones are singles
Ken: and the 2 back burgers look to be double
Josh: back right looks single to me
Ken: maybe
Ken: but my theory still works
Ken: cause like you say, single deal is on double menu
Josh: I would say that calling a double patty a double deal is incompetence, but that would just be stating the obvious given the ad
Josh: you could actually be right

———

Josh: so explain the “2 for” double deal to me
Ken: here you go, found it
Ken: http://hungryasa.com
Ken: play a game and stop worrying about it
Josh: rofl
Josh: i love it
Josh: their entire site is a game for the next 9 days
Josh:…in anticipation of the double value menu??
Ken: thats when the promotion starts
Josh: really?
Ken: only until jan 31
Ken: “The online game supports Checkers/Rally’s’ new value menu. It will offer 17 items, 10 of which start at $1 and seven double burgers and chicken and fish sandwiches offered at “2 For” prices ranging from $3 to $5.”
Josh: so 2 for is a price?
Josh: ???
Josh: wtf
Ken: 2 sandwiches
Ken: offered at “2 for” prices
Ken: yes
Josh: so thats half price?
Ken: i think, yes
Josh: excellent
Josh: very clear
Josh: and they have no problem calling them double burgers here
Josh: so that cant be what “double deal” means. there goes your theory.
Josh: wait
Josh: so if “2 for” means half price
Josh: then their coupon basically says “one free single deal when you buy a half price sandwich?”
Josh: wtf
Josh: shocking display of marketing ineptitude
Ken: i imgaine it makes more sense if you saw the menu
Josh: i have my doubts

The best part of all this foolishness is that this burger joint is really gearing up for this promotion, and has obviously spent a bunch of time and money developing it.

Bringing this back to wine, after trying to make sense of this burger coupon, I think I have a better idea of how the average diner feels as he peruses the wine list at his favorite white tablecloth now. Bewildered.

Honestly, would you rather have a nice Staatliche Weinbaudomane Schloss Bockelheimer Kupfergrube Kabinett, Nahe with your Salmon or a Hospices de Nuits Nuits St. Georges 1er Cru Les Didiers Cuvée Jacques Duret Bouchard Père et Fils?

I bet you punt and buy the Cardinal Zin.

There’s a reason why like, 10 people from the US have passed the Masters of Wine exam. Wine is hard. We should all work a little harder at making it easier, and more fun.

Bonus: a free bottle of Capozzi Olive Oil to the person who leaves a comment with the longest confirmed wine name!

Merry Christmas!

How do you feel about your tax dollars going toward financing California wine country junkets for foreign wine writers?

According to an article today in the Sac Bee, the Wine Institute is organizing trips and funneling public cash to do just that. From the article:

These traveling crews included a reporter, a photographer, a press agent and a coordinator. Total estimated cost for airfare, accommodations, meals, rental cars and fees: $40,000.

Taxpayers and the wine industry pick up the tab. The resulting stories are billed as marketing gold. An eight-page article in the October 2004 issue of GQ Japan, for instance, was considered the equivalent of a $160,000 ad.

Articles further surpass ads, wine industry officials believe, because consumers routinely discount advertising. The articles are presented as “third party” information from writers conveying “what they have seen and how they feel,” Rollo said, as opposed to explicit ad salesmanship.

“These writers are trusted to be objective, and the frequency of their coverage about California will influence consumer purchase decisions,” the Wine Institute said in its 2004-2005 progress report on Canada.

So, are you willing to have your tax dollars go toward marketing for large commercial wineries so that they can export more of their product overseas?

What the Wine Institute is doing is helping to create more demand in these countries, which is good for the industry, but shouldn’t the wine industry be paying its own way? Or, as quasi-farmers, are we going to get a pass on this?

Let me know in the comments.

One common thread I noticed when I talk to folks in person about packaging and that I saw reflected in some of the comments on here is the notion that packaging is ultimately just about having your logo on a box. In which case packaging is superfluous at best, and ego-tastic at worst.

In other words, specially designed direct-to-consumer packaging is an exercise in vanity that will end up in the trash ultimately, so why bother?

I think that if you approach package design as simply another way to get your winery logo into some wino’s house, it almost certainly will get thrown away – immediately – just like all the other boring cardboard packers that wineries ship. That’s what invasive, no-value marketing deserves to have happen to it.

However, if you instead approach package design with the consumer as your focus, and think of ways to surprise and delight them, then I think you’re in a whole other universe.

The graph on the upper right is from Fast Company and comes from data generated by the UK based Design Council. It shows that a cohort of businesses that are “design alert” have outperformed the market by 200%. Here are some other tid-bits from their recent report on design:

• Every £100 a design alert business spends on design increases turnover by £225. (turnover is the volume of business over a period of time)
• Businesses that see design as integral don’t need to compete on price as much as others. Where design is integral, less than half of businesses compete mainly on price, compared to two thirds of those who don’t use design.
• On average, design alert businesses increase their market share by 6.3% through using design.

I think it’s pretty clear there is value in design. The key to me though is to design with the consumer in mind, not the winery. Make your logo small, focus on the product and the experience of opening it. At the very least you’ll get more people sending your wine as a gift, and at best you’ll forge a stronger relationship with your customers. And that’s what it’s all about.

Wine Packaging is Sad

I’ll get this out of the way right up front – direct to consumer wine packaging is pretty sad. Un-thoughtful. Minimalist (ok, cheap). Underwhelming.

Paradoxically, direct is where we producers make our best margins. It’s the place we can most afford to give our best customers a memorable, positive experience. And yet where do all the marketing dollars go? Why, to programming and incentives for corrupt distributors, and toward label and box designs aimed at retail.

As an industry we’ve got it all backwards. Sure, retail is competitive and to stand out you really need to loose the hounds (and the wallet) on the marketplace. But what message are you sending to your direct customers, your “brand ambassadors”, when your $80 pinot arrives unceremoniously in a plain brown box, with nothing other than a receipt inside to show that human thought ever actually entered into the packaging process?

I’ll tell you the message you’re sending.

“Hi there. You’re a high margin customer and we’d like to keep you that way. We might send you some expensive vintage announcement cards to entice you to buy, but once you’ve forked over the cash we’d like to keep it in our pocket, thank you very much. Enjoy the wine Mr. Direct Customer because that’s what you paid for, not a pretty package.”

I think that view is pretty myopic. These direct folks need to be nurtured and cherished. We need to pet them lovingly, and often.

Consider posts like this over at Vinography entitled “When Wine Tastes The Best“. Think back on the last time you had a really great, transcendent glass of wine. Chances are it had less to do with the quality of the wine in the glass than it did with what was going on in your life at the moment. It’s all about experience.

Why then are we sending plain brown boxes to folks forking over luxury prices for a bottle of juice? After all there’s a reason a Tiffany’s box is green (or blue – what heck colors is that!?), and it doesn’t have anything to do with the quality of the silver inside. It’s all about the experience, managing the expectation of what lies within. And it’s an experience that we can help direct with creative packaging.

Sure it will cost more. Sure it will take effort. But aren’t direct customers worth it? And isn’t the payoff worth it? If people are happy, wine just tastes better. That’s good for the customer, good for the brand and good for the bottom line.