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Working With Wine, Beer and Spirits Distributors
This presentation gives wineries, breweries and distilleries a full overview of how to successfully work with distributors to promote their brands.
Working With Wine, Beer and Spirits Distributors
- 1. Steve Raye President andCEO Bevology Inc. Steve@BevologyInc.com +1-860-833-6272 How to Grow Your Wine and Spirit Brand in the U.S. With or In Spite of Distributor Support
- 2. Working with Distributors •What do Distributors Want • How to Find/Connect with Distributors • Managing the Relationship • Resources
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- 4. Trend: Consolidation andGrowth 2013E 2014P 2014E 2013P Southern Wine & Spirits of America AL, AL, AZ, CA, CO, DE, FL, HI, ID, IL, IN, IA, KY, ME, MD, MI, MN, MI, MT, NV, NH, NM, NY, NC, OH, OR, PA, SC, UT, VT, VA, WA, DC, WV, WY $ 11,390 $ 11,750 3.2% 22.1% 22.3% Republic National Distributing Co. AL, AZ, CO, FL, GA, IN, KY, LA, MD, MI, MI, NE, NM, NC, ND, OH, OK, SC, SD, TX, VA, DC, WV $ 6,095 $ 6,480 6.3% 11.8% 12.3% Charmer Sunbelt Group AL, AZ, CO, CT, DE, FL, MD, MI, NJ, NY, PA, SC, VA, DC $ 5,380 $ 5,575 3.6% 10.4% 10.6% Glazer´s Family of Companies AL, AZ, AR, IN, IL, IA, KS, LA, MS, MO, OH, OK, TN, TX $ 3,475 $ 3,655 5.2% 6.7% 6.9% Young´s Market Co. AK, AZ, CA, HI, ID, MT, OR, UT, WA, WY $ 2,820 $ 2,925 3.7% 5.5% 5.6% Wirtz Beverage Group IL, IA, MN, MO, NV, WI $ 1,775 $ 1,860 4.8% 3.4% 3.5% Johnson Brothers Liquor Co. AL, AZ, CA, CT, FL, HI, IL, IN, IA, KY, MA, MN, NE, NV, NM, NY, NC, ND, RI, SD, WA, WI $ 1,660 $ 1,735 4.5% 3.2% 3.3% Martignetti Companies MA, ME, NH, RI, VT $ 1,200 $ 1,200 0.0% 2.3% 2.3% Allied Beverage Group NJ $ 750 $ 775 3.3% 1.5% 1.5% Fedway Associates NJ $ 735 $ 760 3.4% 1.4% 1.4% $35,280 $36,715 4.1% 68.4% 69.7% $16,300 $15,975 -2.0% 31.6% 30.3% $51,580 $52,690 2.2% 100.0% 100%Total Distributor Markets % Chg. Top 10 Total Other Sales Revenue Market Share
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- 6. Money • Think test,not launch • Launch PLUS Years 2, 3 ,4 • Payment terms: better than they provide their customers • Focus: Commit to do a limited # of things but do them very, very well
- 7. Margin It’s your primarytool – Min. 25% after all incentives, 35 to even 40% frontline to get their attention – Build into price structure, their state/structure
- 8. Manpower • Feet onthe street: Brand Ambassadors, Market Managers…can be deal maker or breaker. • In-country brand management • Sources for Brand Ambassadors
- 9. Marketing • Signals thatyou’re not ready yet: – One bottle you can’t leave behind – Ad/POS mockups vs. printed materials – “We haven’t thought about that” as a response to a question • Don’t schedule the meeting until all the support items are in place. • A fully fleshed out marketing plan vetted/presented by someone with industry “street cred”
- 10. Media • Strategies forgenerating consumer awareness and trial AND to tell the trade what’s happening – Consumer: • Traditional print, newspaper, radio • Online: Social media advertising: Facebook, Google AdWords – Trade media and PR • Social Media: not an option, it’s a requirement. Focus on engagement not just building fan/followers • Trade Media has the multiplier effect
- 11. But Wait…There’s More! •Recognize distributor wants to minimize risk • Tools: Celebrity endorsement, compelling marketing plan/positioning, brand ambassadors, existing customer orders • Blocking and Tackling: – Be smart picking markets and warehousing – Sufficient Inventory – Sell where your people already are
- 12. Oh Right…the Product •Quality of juice is necessary but not sufficient: POD that MAD (Point of Difference that Makes a Difference) • Packaging: beyond the bottle & label – Reshipper is your second-to-last ad – SCC code on bottom too – Repeat key info on multiple sides – Clear Vintage/Varietal info
- 13. Product Cont. • ScoresMatter: Get US-recognized ratings and reviews • Tasting Events and Competitions – Strategy: enter all till you win Gold/90+ points • Publications: Be Visible – Trade: Beverage Media, Santé, – Crossover: Wine Enthusiast, Wine Spectator, Tasting Panel, Imbibe, Mutineer, In the Mix • Influencers: Let them know you exist • Bloggers/Sites: Pick the ones that can help move boxes…K&L Spirits Journal speaks to an audience that respects the author, responds to his recommendations, and can buy at K&L
- 14. KISS (Keep itSimple) Keep the brand proposition simple No more than 2-3 statements
- 15. What Distributors Want •The right “Chemistry” • Fills a void in the portfolio • New brands they feel their expertise can develop and grow • Brands with a Point of Difference that Makes a Difference • Won’t antagonize current suppliers • Strengthens their position within the trade • To see your passion and commitment
- 16. What Distributors Want(cont.) • You to be prepared: – Understand the industry, competitive situation by market, what drives distributors – Marketing support materials: in inventory, not “in development” – Product in inventory in a U.S. warehouse
- 17. What Distributors Want(cont.) • You to have reasonable expectations • Timing: for the first meeting, to get to yes, launch, roll out • Willingness to listen, shape plans, • Understand the wholesaler’s business (don’t ask for just Hoboken and Jersey City) • Humility and realistic, arrogance is deadly • Reasonable volume expectations – 1,000 cs/month – Container for first order • What happens if you don’t?
- 18. What You Want Distributorsto call you, but how do you do that? Sell the Sizzle! -Velocity at retail
- 19. • Focus, focus,focus…like a laser • Getting it in is the easy part, getting it out is hard • The only metric that matters: repeat orders at retail. • Be so successful in a limited number of accounts that you can support, that you create trade word-of-mouth buzz as a hot brand. It’s All About Replacement, not Placements
- 20. How to Finda Distributor/Get a Meeting • Get professional help • They get 100 calls a week, take 10 calls, maybe see 1 brand • Understand the landscape/Think out of the box: – Usually 2-3 majors per market – Supplier alignment – Franchise states • Find sales dept. for lease/hire with existing network • New craft divisions • Recognize it’s a zero sum game…if they take you in, that means they’ve got to cut focus on something else • Read: Trade pubs, newsletters and search archives.
- 21. Okay, I’ve GotOne. Now What? • Don’t ask them to teach you. Find a guide to help you manage them. • Recruit/focus on a limited set of salespeople dedicated to your brand • Recognize you’re not a priority…you’ll need do the heavy lifting yourself – Product training programs for accounts, – Sampling on and off premise – Brand Ambassadors
- 22. Key Industry Newsletters Wineand Spirit Daily (WSD) http://www.winespiritsdaily.com/subscribe.php ($380/year) Shanken News Daily http://newsletters.shankennewsdaily.com/ Industry News Update Also known as “Mark Brown’s Newsletter” or “Buffalo Trace”. Email mbrown@buffalotrace.com to be put on the mailing list. Wine Business Daily News https://secure.winebusiness.com/u/index.cfm?go=ul&re=subscr ibe&sourceid=1000002&pubid=3&ref=rn_news&listingid= Modern Distillery Age www.distilleryage.com WSWA Smartbrief https://www2.smartbrief.com/signupSystem/subscribe.action?p ageSequence=1&briefName=wswa&utm_source=brief Wine Industry Insight http://wineindustryinsight.com/ Wine Industry Advisor Afternoon Brief (Published by Wine Industry Network) http://www.wineindustryadvisor.com Just-Drinks http://www.just-drinks.com/ (Subscription fee)
- 23. Resources • Key tradepublications: – Beverage Media Somm Journal – Tasting Panel Market Watch/Impact – Bar Business Beverage Dynamics – Stateways • Crossover publications – Wine Enthusiast Wine Spectator – Wine and Spirits Chilled – Imbibe In the Mix
- 24. Competitions and Evaluations Acceptcurrently-not-imported products – BTI/Beverage Testing Institute – Ultimate Beverage Challenge – San Francisco World Spirits Comp., San Francisco International Wine Comp. – New York International Spirits Competition – Spirits of the Americas
- 25. Industry Events • USATrade Tasting: March 21-23, 2016, NY • WSWA: April 18-21, 2016, Las Vegas • Fancy Food Show: SF and NY Jan and June • Wine Bloggers Conference: Aug. 11-14, 2016, Lodi CA • Boston Wine Expo: Feb. 2016 • South Beach Wine and Food: Feb. 25-28, Miami FL • Nightclub and Bar Show: Mar. 7-9, 2016, Las Vegas, NV • Distiller’s Convention and Trade Show, TBD • NRA: May 21-24, Chicago, IL • Aspen Food and Wine Classic, June 2016 • Tales of the Cocktail: July 20-24, New Orleans, LA • San Diego Spirits Festival: August
- 26. Thank You! Steve Raye Presidentand CEO Bevology Inc. 401 Park Ave. South 9th Floor New York, NY 10016 212-613-2713 Steve@BevologyInc.com OH-pinions blog
Editor's Notes
- #7 Money: enough banked to not just for launch, but for years 2-3-4-5. ..you can not build the brand by using current revenues. Make sure the budget is comprehensive…did you allow for shipping and storage of POS, sampling programs Payment terms…better than they provide to their customers Focus: Do limited number of things extremely well…limit markets to just one or two …remember goal is to be perceived as hot. Don’t think launch, think test. You’ll get half of it wrong at the beginning, key will be measuring what you’re doing, figure out what’s working and why, and then keep improving and measuring it.
- #9 Feet on the street…brand ambassador(s), market managers…people whom you pay to be 100% focused on your business and “prime the pump”. This is becoming a deal maker…or deal breaker.
- #11 Your plan should include a rock solid strategy for getting consumer awareness and trial…advertising in print mags, newspapers, local radio, online ads on sites that support on premise accounts (Thrilllist, Urban Daddy) Social media: It’s mandatory…and remember the goal is not just to amass a large base of fans/followers…it’s to engage them and empower them to become your advocates and ambassadors. (whole presentation
- #12 They don’t want to take risks with you, they ‘re looking for you to reduce their perception of risk on their part Tools: celebrity, a compelling marketing plan, brand ambassador assets, existing customer orders (one guy we’re working with has a mandatory authorization for Outback Steakhouse)Pickup location (and impact on freight costs). If you’re trying to sell in CA with a pickup location on the east Coast, it’s not going to workBlocking and Tackling:. Sufficient inventory: seems simple but it can kill a brand to be out off stock at launch/roll out or time of maximum attention that you’ve set up. Example: Blue Chair Bay Rum oos for a month in the summer. don’t build in inefficiencies. Chances are, if you’re going to NY first (and think long and hard about that)…don’t make CA #2. You’ll burn up your people’s time in unproductive travel. Smarter to do NY, NJ, CT, MA where one guy can easily get to all to all the markets
- #13 Quality of juice is a given, when asked what is the difference that makes a difference for your brand, Don’t start with a better liquid. At the current competitive quality levels you can’t win on quality alone. It’s necessary, but not sufficient. Generally won’t be a Point of Difference that Makes a Difference Packaging: Not just bottle/label/cap and all the quality cues inherent in your choices there. But also the “trade packaging: reshipper, quality of inserts. Think of the reshipper as a display…what do you want to communicate to the consumer reshipper…Pisco Porton unfamiliar category, designed reshipper to also show off end use-the drinks that can be made from it Easy handling (SCC on bottom). should allow for Repeat key info on multiple sides. # bottles, size of bottle, UPC code, vintage, varietal…don’t make anyone work to figure out what’s in the box. They won’t Make sure when cut the reshipper is still your second most important sales tool (after the bottle itself) Use the back label, gift cartons, fact cards etc. to tell the three most important facts