Vin65 Blog

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Andrew Kamphuis
 
November 25, 2014 | Ecommerce | Andrew Kamphuis

3x More Sales – The Effect of an “Amazon Prime” Like Program in the Wine Industry

A year ago we launched 46Brix, an "Amazon Prime" type program for the wine industry. Let's start with the premise: a customer pays $79/year and receives shipping included on all of their wine purchases from 29 different wineries. Let's look at how we are doing one year into the program.

From a wineries perspective, the two goals of the program are to:

  1. Build loyalty with their top online customers 
  2. Attract new customers who are top ecommerce customers at other wineries

From our internal data at Vin65, we know that the top 10% of online wine buyers all buy at multiple wineries on our platform. We were wondering if we could shape their habits.

So how does the program measure up now that we are almost one year in?

Building Loyalty

We’ve previously announced the results at the 6 month mark - which stated that joining 46Brix increased wine sales by 3.75 times. Now that we’re approaching a year - we’re finding some new results.

Most customers who joined the 46Brix program have been buying wine online directly from a winery for a little over 2 years. Their average yearly purchase value before joining 46Brix was $738.42. The immediate 12 months prior to joining 46Brix was $653.52. (It appears that these customers were actually slowing down in their buying habits from the wineries in the program in the year right before signing up).

After signing up for 46Brix, customers stepped up their buying to have a yearly value of $1941.47 on average. 46Brix members bought 3 times more wine than they did before.

Attracting New Buyers

Only 11.3% of 46Brix members have tried a new winery in the program this year.  The other 88.7% of 46Brix members continue to be loyal and buy wine from the wineries that they previously purchased from.  

Determining the ROI

For a winery calculating the cost of the program, they would have to look at how many orders a customer had (this is easy using our 46Brix reports).  $79 in shipping revenue (from the initial signup) would pay for 2-4 of those shipments.  The remaining shipments would be shipped with the winery bearing the costs of additional shipments.  The winery would need to determine if the increase in sales from a customer ($1941.47-$653.52= $1287.95 average increase) was worth the amount given up in shipping.

Where is the Program Heading?

Over the last couple months we’ve seen an uptick in new customers signing up.  The program is still relatively young but it’s clearly working.  I think of my own personal habits - having a prime membership at Amazon makes me want to check Amazon first for products I want to purchase.  I’d like to think that consumers feel the same way about their 46Brix membership.  

At Vin65 we are committed to selling more wine direct to consumer.  We will continue to encourage wineries to connect with their best customers and 46Brix is one program to do that well.

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If you would like to talk to us more about the program email sales@vin65.com or info@46brix.com.

Comments

Sandra Hess's Gravatar
 
Sandra Hess
@ Nov 30, 2014 at 6:00 PM
Loyalty programs take time to build and need to be effectively messaged and marketed by the winery to a qualified segment of customers first. After initial testing, then expand the offering to a broader audience. Online shoppers WANT great deals on shipping and as the online wine space continues to become more and more competitive, now is the time to ensure that a clear and effective shipping strategy is in place for 2015. GREAT EFFORTS by Vin65 and WineDirect to launch this program and continue to enhance.

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