To an extent not usual in most businesses, beverage alcohol stores are frequently hemmed in by forces outside their control concerning how they can market, merchandise and sell their wares. The size of the store, the specific neighborhood, the spending power of their clientele, the changing competitive landscape, the shifting tastes and habits of their customers, and, of course, the shifting state and local restrictions on how and when they operate, all make even the idea of tweaking their approach to the marketplace seem overwhelming.
But continuing to do business the same way today as yesterday may soon leave an operation at a competitive disadvantage, whatever the type of store and customer base. The stuttering economy, the digital revolution, the growing interest among consumers for more information about wine and spirits – all these offer opportunities to make change work to your benefit.
KNOW YOUR BUSINESS
It’s tempting, given the exuberant sales of, say, moscato wines or flavored vodkas, to go whole hog and buy pallets worth of whatever is surging in the overall U.S. marketplace. But according to smart industry observors, it may be better to turn away potential business than to change your store’s direction and philosophy based on a sudden updraft in sales of a particular item. For instance, when taking on spirit brands to discount, it may be better to focus only on quality brands that for some reason or another may be available, rather than a general approach to deep discounting that wouldn’t provide items making a good fit with regular customers.
As the wine and spirit industry continues to divide into segments – Big Box, wine specialist, etc. – maintaining connection with your core customers is essential. But there may be more than one type of customer at that core, and so crafting a selection that suits each group is essential. For example, in a neighborhood with many Hispanic shoppers, a wide selection of Spanish wines can be appropriate, but often stocking other items are also increasing sales, such as large format handles of Scotches and Cognacs as well as high-end brands of whiskey popular with that demographic that are hard to find at retail. Adjusting that mix due to overall marketplace trends only makes sense when the trends are also something your established customers want.
KNOW WHAT YOUR CUSTOMER NEEDS
The late Steve Jobs of Apple was famous for saying that his task wasn’t giving his customers what they needed but creating something for them they didn’t know they wanted. Most stores do a fine job of keeping tabs on their leading items and categories as well as those that lose popularity or never gain a foothold with their customers, a process that informs and guides future orders. But this method doesn’t account for the items your customers would buy, or the way they would use your store, if only they had been given the opportunity.
For example, where legal, stores can establish gifting centers for the upcoming holidays, designed to make it easier for customers to make holiday purchases for family and friends. Gathering gift cards, gifting bags, cocktail books and other items that might appeal as a special present for harried shoppers allows you to engage customers once they are in the store and to attract new or infrequent customers who need assistance when selecting beer, wine and spirits gifts.
This method might be limited to stores with the right kind of space, location and staff, but even a modest-sized shop can do better in providing solutions for their customers. And something similar can be managed at other times of the year. Picnic or barbecue centers in the summer, for example, where beers, wines and spirits meant for warm weather entertaining are gathered along with fruit, mixers, ice and other entertaining gear and suggestions. State restrictions may not allow that, but creating a smaller high-end spirit section complete with packaging solutions for Father’s Day could work in many outlets, regardless of size.
Facebook, Twitter and the entire world of social media offers applications for stores that are limited only by the imagination. There is a cost, of course, usually to pay a dedicated employee or to account for the time staff members are required to commit to the task, but many retailers are finding social media a great way to build new connections and business.
Using social media can generate more excitement about the brands a store carries, can promote tastings and other events, where legal, and likewise build buzz for any contests, where legal. Using Facebook and Twitter creates a dialogue with customers and prospective customers.
Loyalty cards that reward frequent shoppers are a less digital form of socializing with your customers, as is establishing a computer record of every wine or spirit any single customer has purchased in the past. The benefit? It will make sense the first time a forgetful customer asks a staff member not especially schooled in wine if your store still stocks that fabulous garnacha she bought last month. A quick check on her purchasing history, and the customer-store bond is strengthened.
Forms of social media, whether reviews on Yelp, promotions on Facebook or Groupon, or sales alerts sent out to followers on Twitter, allow retailers to share crucial information about their stores, their discounts, rare or unusual vintages or bottles, give-aways, events and tastings in a way newspapers and flyers never could. A social media presence requires some planning, time commitment, a sales strategy and monitoring to see what sort of activity works, but given how much stores once spent on advertising in newspapers and other forms of media outreach that tried to connect with customers, the price is right.
MAKE IT EASY
Crafting a wine and spirits shop to be easy to navigate has become a compelling strategy. Many stores that stick to a certain segment of the market or feature a narrow selection of products, make the buying experience a relief rather than an intimidating chore. The best-known example of this was the New York City-based Best Cellars, in the 1990s, which started out by organizing wines in eight style categories: fizzy, fresh, soft, luscious, juicy, smooth, big and sweet. With a goal of making shopping for wine as much fun as drinking it, the store style helped change wine and spirits merchandising.
Another New York wine shop, Bottlerocket Wine & Spirits, took a different tack, organizing the wines sold in two ways: alphabetically by country and also grouped around kiosks by theme – wine for seafood, or suitable for gifting, or by flavor profile. Other stores have opted for the so-called progressive list used in restaurants, in which wines are gathered by color, body, density and potency at a range of price points, from lighter intensity, sweet and slightly sweet off wines at a range of price points, to off-dry and delicate wines and whites with more intensity, and then gradually increasing in intensity and fullness to wines with big structure and intensity, such as Cabernet Sauvignon and Syrah, regardless of origin. The key is always to focus on how to best interest the consumer to most easily shop his or her category, and to also spur trial among consumers new to the category.
BE SOMETHING SPECIAL
Some stores have expanded their position in craft spirits in anticipation of growth in that category. Other establish departments to showcase locally Some stores opt instead to differentiate themselves by crafting a smaller selection of wines, beers and spirits that they actively promote. Others have taken on theproduced spirits and wines. And some stores source their wines directly from winemakers and keep their stores at a low temperature to maintain quality.
There are an endless number of routes to take on the path to stand out from the crowd and attract new customers: staking out the service of selling wines to be paired with foods, or becoming a center for home cocktail enthusiasts, or a regional home for beer enthusiasts. These can be treated as businesses within the overarching store model, but whatever the method, 21st century retailing requires that somehow, someway, your customer thinks of you as a special place and not a way station selling a commodity. As new retail formats arrive to chip away at pieces of your business, it’s important for wine and spirits stores to pick their own niche, because if not, your competition might do it for you.