How to start a wine club

How to start a wine club

A wine club is a membership based club where members get special offers of wine. A wine club can be a direct wine club: in this case, it is operated by a vineyard and usually offers only wine produced by the vineyard. Indirect wine clubs can be run by anyone, from a bottle-shop to a wine importer. They normally do not project the impression that they produce wine, but select wines for their members from 3rd party wineries. Some of these clubs are vertically integrated and actually do make wine and/or have wine made for them under contract.

In the original wine club concept, there were no options for the members. They would commit and buy in advance a certain number of bottles per period. Bottles were then invoiced and then shipped directly to the member’s doorsteps. This is termed “continuity marketing”. Continuity marketing has the advantage that the marketing expense occurs only once — at the customer acquisition stage. From then on, each sale bears no to little marketing cost.

Today,due to customer demands, wine clubs tend to be more flexible. Here are some examples of wine club strategies:

The “no wine club”: a lot like a newsletter, but with a clear call to action. Periodically, the winery sends special offers to its members who can, with a single click, buy their wines. This could be termed “mailing list sales”.

• The very open wine club has a small commitment, like buying 2 bottles of Semillon each year. When the time comes to ship the wine, members are notified and can choose to add products (in general with a club membership rebate).
• The original wine club continuity concept: in which the wines, the quantity and when they will be shipped are all fixed. For example, members commit to buying a case of 6 bottle of Sangiovese yearly, and a case of Chardonnay 6 months later.

These are only a few of the current marketing strategies. Of course, you can decide on any strategy for your wine club, either very open (like the “mailing list sales” approach) or more strict. You can also run more than one wine club delivery plan.

Of course, while this article is centered around wineries and wine club, there are also micro-breweries and distilleries that employ exactly the same tools to serve their best customers.

Why start a wine club now?

Wine clubs bring many benefits to wineries. They are part of the Direct To Consumer trend. No intermediaries between you and the customer. Each fulfilled order results in much higher profit per bottle. If your members trust you to hold their credit card on file, this becomes a very attractive proposition.

“The average wine club member buys almost seven bottles of wine when visiting a cellar door and spends almost $65 more per visit than the non-club member.”— Wine Australia Research and Development, March 2014

4 Steps to setting up your wine club

1. Define your club policies

While you can run more than one wine club plan, let’s start with one!Start with a simple sets of rules, inspired from the examples aboves. Start with simple and easy to understand for you, your members and your staff.

2. Launch your club

To promote your club, you need to publicize the benefits of the club to your members. Use every possible channel: Newsletter (email list), your cellar door, website, social networks… Simply spread the word by highlighting the benefits of your wine club to your audience.

Most wine club management software allows you to set up your club policies and will handle most operations for you. Most of them a quite prescriptive and force winemakers to operate using some fixed processes or policies.

Subscribility, our cloud based solution, has been designed by winemakers for winemakers. It offers great flexibility and you can manage your club and wine plans according to your wishes and dreams.

Subscribility also comes with tools that let your customers sign up and manage their shipments online.

3. Operate your club

In practice, your club starts the day you will sign up…one active member! Your first members are the most important and you will remember them for life. There is an old saying in direct marketing, “the best fish are caught first”!

Compared to one-time customers, your members seek a more engaging relationship with your winery. They trust you to produce, year after year, great quality wine. In exchange, you have to take good care of them. Offer them some special treatment: private activities (luncheon, private tasting, harvests,…), discounts or even exclusive products. In fact, by definition, your most loyal members do not need discounts — it is better to reward them with special wines, gourmet food or maybe complimentary nights in your B&B if you have one.

A “club run” happens when you send a case of your wines (or more!) to all your members. With large clubs and without specialized software, this can be a daunting process. Processing credit cards manually, chasing after missing/invalid/expired credit cards, contacting the members, printing labels…

As soon as your club reaches 40 or more members, automation is needed: think automatic renewal of credit cards, automatically generated shipping labels and a link with your carrier, SMS message to your members to inform them about the shipping of their order, etc…

Whatever tool you use, make sure you honor your policies and ship any order for your club members on time. These happy customers will most likely buy again from you. Since they have trusted you with their credit card details, make sure they receive first class treatment!

4. Adjust your club

As time passes, you will become more and more accustomed to the requests of your members. While it is difficult to accommodate them all, you should use individual requests to define new club plans.

For instance, some of your members would like to have only red wine. As soon as you have 5–10 of these members, you can now start a “red” wine continuity plan. Some other members would like to buy 2 cases of 12 bottles a year. You can now create a 24 pack plan!

For some smaller wineries it is easier to run multiple small plans, each delivering orders to members at various times during the year, than to operate a very large plan.

With this in mind, you will be able to fulfil your members’ needs and keep happy members for life — but don’t be disappointed if “life” means 3 years or less as the average attrition from wine club plans is around 33% per year. People get bored with similar wine, so if you can retain them by giving them more variety, fall over yourself to do so! Surprise and delight them occasionally with a free gift. (But be careful not to build a pattern which promotes expectancy). Talking to them often with interesting relevant news also helps retain their interest.

Conclusion

While starting a wine club can be intimidating, it is a very rewarding activity both for the winery and the members.

Creating a wine club is the start of a loyalty program: you acknowledge that certain customers (the members) are entitled to greater benefits and a deeper relationship with your winery.

Transforming one time consumers into long time members will allow you to focus on the products and activities that have the most impact. It will improve your knowledge of your best customers, increase revenues (imagine having 80% of your production already sold!), improve profit and improve your cash flow (each wine plan run brings steady revenues at a fixed date).

Benoît des Ligneris, Ph. D.Chief Growth OfficerSubscribility : Wine club, cellar door, ecommerce management made easy

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