Despite the general economic slowdown, the global wine market is growing. Every year more people drink more wine and they start to spend more on each bottle. It is estimated that the global wine market is worth some 240 Billion USD, with the US being the biggest consumer market. France comes second. China is growing more quickly than any other country (in 2008, China generated total revenues of $5.8 Billion). In terms of production, more than 60% of all wine is still made in Europe; with France, Italy and Spain as the leading wine producers.
Although wine distribution, marketing and communication varies A LOT from country to country and consumer behavior is often driven by social and cultural factors, there is one common trend: the Internet has become central to marketing and selling wine as online sales grow. A study by the Bordeaux Management School in France found online wine sales grew 30% in the last year alone in that country.
Unfortunately, I was unable to find reliable numbers on how much wine is sold online every year overall, but since France alone saw a 30% increase in web sales from 2008 to 2009, the overall volume seems important enough to dedicate some thoughts on the future relevance of video for online wine retailing.
I looked at some of the most important online wine retailers to see if and how they use video in their online strategy and found the outcome disappointing. Video marketing is still a rare discipline in the online wine retailing business it seems although there are a couple of extraordinary success stories, like Gary Vaynerchuk’s WineLibrary.tv or the German wine shop TVino.de
Gary Vaynerchuk, one of Internet’s hottest retail celebrities has created a business of $70 million based partly on the success of his daily video wine-tasting show at WineLibrary.TV. Wine entrepreneur and social media star, he is an early adopter of online video marketing. He published more than 840 episodes, presenting 3 different wines every day for almost 3 years. Vaynerchuk has perfectly understood the value and the power of online video in order to create a brand and broaden his potential customer base to ultimately sell his products over the Internet. But most of all he has shown a great understanding for what drives online buying processes in general and decision making when it comes to wine and wine-related products in particular.
Think about it for a moment: wine is just not like any other product you shop for off or online. It is not a standard product. There are millions of different producers and brands and quality can differ from year to year depending where it comes from. So, wine is a typical “prescription” product. Most likely, you would rather listen to an expert, a vendor, a waiter or a wine-literate friend than risk 20 Euros just because you like the label. Generally speaking and for most people, wine shopping is a rather sensual experience. You want to touch the bottle, feel the label, see the color, get some expert advise on what to eat with it and most of all you want to know how it tastes before you buy it. So either you are lucky enough to taste the wine yourself before you decide or you need somebody knowledgeable to describe the taste to you.
As more expensive wines became mainstream consumer goods, sharing wine knowledge also became a vehicle for communicating social status. In addition, being able to select a decent wine has required specialized knowledge. Consumers that know about wine represent a broader consumer group called called “the professional consumer.” Professional consumers are people who actually want to know stuff about the product they are consuming. They want to learn about it – especially when it comes to food and its origin – and then they want to share that knowledge within their social network.
Video content in the form of wine-tasting shows -check out the examples of WineLibrary, TVino (Germany), Majestic Wine (UK) or Wein&Co (Austria)- have great potential as they provide marketing and communication elements so crucial to the online decison making process.
Watching an entertaining and informative 5 minute video that compares 3 different Riojas, Chardonnays or Pinot Noirs can be a much more interesting experience than shopping for wine in the aisles of a supermarket. Getting an expert description of taste and comparing prices before actually ordering a case is an extremely useful and user-friendly decision making tool for online shoppers. Also, these kind of videos are relatively easy and low cost to produce since merchants don’t need complicated settings or sophisticated post-production. All that’s needed is a credible presenter or host who connects with the audience, a camera operator, and a video editor. In many cases that can be one person.
Wine online retailers who use good video content and wine-tasting shows will have a competitive advantage compared to text-based shops since they offer entertainment and education, something that many wine shoppers are actually looking for.