{"id":2451,"date":"2019-04-23T18:40:52","date_gmt":"2019-04-23T18:40:52","guid":{"rendered":"https:\/\/bevologyinc.com\/blog\/?p=2451"},"modified":"2019-04-23T18:40:54","modified_gmt":"2019-04-23T18:40:54","slug":"just-released-sonoma-state-research-report-on-digital","status":"publish","type":"post","link":"https:\/\/bevologyinc.com\/blog\/2019\/04\/23\/just-released-sonoma-state-research-report-on-digital\/","title":{"rendered":"Just Released: Sonoma State Research Report on Digital\/"},"content":{"rendered":"\n

I’m sharing a research report courtesy of a team of wine marketing profs. from Sonoma State University and published by WineBusiness.com. The subject was digital marketing by domestic U.S. wineries, but the numbers are a good point of reference for export wineries as well. <\/p>\n\n\n\n

And a note to export producers…We’re all waiting with bated breath to hear the ruling by the U.S. Supreme Court on a case that will have potentially significant impact on wine e-commerce. The decision is anticipated to come in May\/June.<\/p>\n\n\n\n

Are You Selling Enough Wine Online? Status of Digital Marketing Strategies of U.S. Wineries <\/h2>\n\n\n\n

by Liz Thach, MW, Damien Wilson, and Pierre Costa<\/a><\/strong>
April 22, 2019\n\t\t\t\t\t\n\n\t\t\t\t\t\n\n\t\t\t\t\t\n\n\t\t\t\t\t\t\n\n\t\t\t\t\t\t\n\n\t\t\t\t\t<\/p>\n\n\n\n

Global online retail sales reached $2.3 trillion in 2017\u2014a \n24 percent increase over the previous year – and is expected to grow to \n$4.8 trillion by 2021, according to eMarketer. All around the world \nconsumers are increasingly using their fingertips to shop rather than \nvisit brick and mortar stores. Indeed, Pew Research reports that 79 \npercent of American now shop online. When it comes to wine however, a \nrecent survey of over 1,000 U.S. wine consumers shows that only 27 \npercent have purchased wine online. Part of the reason for this is \nonerous shipping regulations that differ by state, the need for an adult\n signature to receive alcohol, and high shipping costs. But could there \nbe another reason?<\/p>\n\n\n\n

Could it be that U.S. wineries are not reaching out to consumers via \ndigital marketing the way companies in other consumer products \nindustries are?<\/p>\n\n\n\n

\"img<\/figure>\n\n\n\n

The World of Digital Marketing<\/em><\/p>\n\n\n\n

In order to investigate this hypothesis, a survey was developed \njointly by Sonoma State University Wine Business Institute (WBI) and \nSommDigital.com. The purpose was to examine digital marketing strategies\n and practices used by U.S. wineries. The results reveal that there are a\n number of innovative wine businesses that are adopting and benefiting \nfrom digital marketing, but that others are struggling. This survey also\n serves as a benchmark that can now be measured over time.<\/p>\n\n\n\n

Methodology<\/strong><\/p>\n\n\n\n

An online survey was developed and beta-tested before sending it out \nto a list of 3,362 email addresses obtained from the Wine&Vines \ndatabase. The email was sent to individuals responsible for making \ndigital marketing decisions, and job titles associated with Marketing, \nDTC\/Wine Club, Public Relations, and Sales. Two follow-up emails were \nsent over the course of 3 weeks to remind wineries to complete the \nsurvey. In the end, a usable set of 257 responses was collected. The \ndata were analyzed for significant differences using Microsoft Excel.<\/p>\n\n\n\n

About the Respondents<\/strong><\/p>\n\n\n\n

Wineries from 30 U.S. states responded to the survey, with 58 percent\n from California, 10 percent from Oregon, 5 percent from Washington, and\n the remainder from other states. Case production included 59 percent \nfrom small wineries producing less than 10,000 cases annually; 35 \npercent producing 10,000 \u2013 500,000 cases; and 6 percent producing more \nthan half a million cases. Forty-four percent of the respondents said \nthey were the winery owner. In terms of customers who purchase wine \nonline, an average of 51 percent were identified as wine club members, \nwith the remaining 49 percent being consumers who were attracted to the \nwebsite to purchase wine.<\/p>\n\n\n\n

Results \u2013 Broad Range of Digital Practices Being Used<\/strong><\/p>\n\n\n\n

Digital marketing can be defined as \u201cany form of online interaction \nfor the purpose of creating demand for products and services.” This can \noccur on any online platform, such as computer, tablet, or mobile phone.\n With this in mind, respondents were asked which of seven major digital\n practices they were engaged in. The findings (Chart 1) show that U.S. \nwineries are using all of these practices, with social media used most \ncommonly by 98 percent of the sample; followed by e-commerce at 76 \npercent and SEO at 45 percent. Least used was paid search\/SEM at 11 \npercent.<\/p>\n\n\n\n

Chart 1: Major Digital Marketing Practices Used by U.S. Wine Industry<\/strong><\/em><\/p>\n\n\n\n

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Social Media Usage<\/strong><\/p>\n\n\n\n

Since social media were used so frequently, we analyzed the types of \nsocial media platforms and discovered that Facebook is used the most at \n98 percent, Instagram 88 percent, Twitter, 67 percent, Yelp 47 percent, \nTripAdvisor 46 percent, and YouTube at 35 percent. Since Facebook is \nmore popular with older demographics and Instagram with younger \nconsumers, this is positive to learn that many wineries are reaching out\n to both segments. It also shows that they are concerned with monitoring\n customer rating sites such as Yelp and TripAdvisor to support positive \nwine tourism. However, there appears to be more opportunity to engage \nwith consumers via video platforms.<\/p>\n\n\n\n

Digital Marketing Goals<\/strong><\/p>\n\n\n\n

Clarity and measurement around digital marketing goals are considered\n to be two of the most important actions when implementing digital \nmarketing strategy. Therefore, respondents were asked: \u201cWhat are the \nmajor goals for your digital marketing strategy? Check all that apply.\u201d \nThe results show that brand awareness is the most important goal at 82 \npercent of the sample, followed by increasing traffic to website 74 \npercent; improving sales revenue 71 percent; and customer engagement at \n69 percent. Overall these goals seem positive, but when asked about \nmeasurement, 34 percent of the sample reported they do not measure \ndigital marketing results.<\/p>\n\n\n\n

Chart 2: Winery Goals for Digital Marketing<\/strong><\/em><\/p>\n\n\n\n

\"img<\/figure>\n\n\n\n

Labor and Budget for Digital Marketing<\/strong><\/p>\n\n\n\n

In terms of who is responsible for implementing digital marketing \n(See Table 1), 45% of respondents reported they delegate it to an \nemployee who has other job responsibilities, but 29% of the work is \nactually performed by the winery owner. A smaller number have a \ndedicated employee for digital marketing or outsource it. In terms of \nhow much of the marketing budget is spent on digital,42% said they spend\n 5% or less on digital, but 25% reported they spend 21% or more of their\n marketing budget on digital.<\/p>\n\n\n\n

Table 1: Who Performs Digital Marketing Work at Your Winery?<\/strong><\/em><\/p>\n\n\n\n

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Challenges in Implementing Digital Marketing<\/strong><\/p>\n\n\n\n

When asked about challenges faced with implementing digital marketing\n strategies, the top issue was a lack of knowledge identified by 45 \npercent of the sample, followed by a lack of qualified staff at 36 \npercent, shipping regulations at 35 percent, and cost at 31 percent. \nThese challenges are consistent with findings from research in other \nindustries regarding the adoption of new technologies.<\/p>\n\n\n\n

Activities to Increase Online Wine Sales<\/strong><\/p>\n\n\n\n

Despite these challenges, a small percentage of the sample reported \nthat they are currently achieving 21 percent or more of their revenues \nvia online wine sales. Therefore, this group was compared against the \nrest of the sample to determine what, if anything, they were doing \ndifferently. The results show statistically significant differences in \nthe categories listed below:<\/p>\n\n\n\n