As wineries try to reach more wine buyers directly, ecommerce offers the most potential for growth in sales, a new study finds.
As an industry, wineries make most of their money by selling to retailers and beverage dealers. In fact, the total U.S. wine market generates about $70.5 billion in total annual sales, according to research firm Wine & Vines Analytics.
Last year the U.S. wine market sold about 325 million cases of wine, including 242 million cases that were sold to distributors and retailers to sell in bars, restaurants and stores, or about 75% of all wine sales, Wine & Vines Analytics says.
But as in other industries where suppliers are trying to increase direct sales to consumers, the sales channel offering the strongest growth potential for wineries in the United States, Canada and Australia is through ecommerce, according to WineDirect, a fulfillment and ecommerce services provider. WineDirect recently surveyed 1,200 wineries with $1.2 billion in direct-to-consumer sales in the three countries.
Ecommerce channel: a big upside
A typical winery generates about 36% of direct-to-consumer revenue through wine clubs, 34% at the point of sale in winery tasting rooms and at winery events, 20% from subscription, telephone, corporate and private-tasting orders, and 10% online, WineDirect says. While ecommerce is still by far the smallest selling channel, it is generating higher average tickets than other channels, the study found.
It recorded an ecommerce average order value of $282, below the $355 for subscription, telephone, corporate and private tasting sales, but above the $237 for wine clubs and $110 for point-of-sale transactions in winery tasting rooms and other winery events. “The weakness of point-of-sale average order value underscores the more leveraged nature of website orders—it is much less costly to execute a marketing email campaign to drive online sales than to staff a tasting room,” WineDirect says.
The average ecommerce order for a winery has increased to $282 from $270 four years ago, says WineDirect. “With a high average order value, low penetration, high average bottles per order and lowest barrier to entry, online sales represent the biggest opportunity for wineries selling direct-to-consumer today,” the survey says.
Other survey findings include:
In 2019, mobile traffic to winery websites is poised to exceed 50% and in 2018 mobile orders on winery websites were up more than 30%.
Between 2017 and 2018, mobile orders among WineDirect winery customers grew more than 30% from 144,000 orders to 190,000 orders.
Mobile visits also increased from 44% to 49% of total traffic, while desktop decreased from 56% to 51%. “Mobile traffic is set to overtake desktop and make up over half of overall site visits,” the survey says.
This article was originally published in: https://www.digitalcommerce360.com
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