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US $200 billion dollar industry drowning in data – but lacking meaningful insights.

The US Wine and Spirits industry is a wild one to watch. Alcohol consumer behavior has shifted dramatically in the last two years leaving many suppliers and retailers rushing to catch up and get ahead. With a significant spike in social drinking accompanied by the ever-changing consumer palate, it’s no surprise total alcoholic beverage sales reached over $222 billion in 2021. The top suppliers in the US market are competing on the basis of accessibility, consumer preference, quality, and price – all without full access to their customer data.

Industry of Discontinuity.

As with any industry, wine and spirits suppliers should always operate under a consumer-centric market strategy in order to compete. A comprehensive understanding of current and future customer trends should be the core driver when deciding which products (plus quantity and price of each product) to ship to individual distributors every month. Unlike most industries, brands in this space historically have not been permitted to sell directly to their consumers or able to access in-depth consumer behavior data. That reality began to shift in March of 2020 when direct shipping restrictions started to loosen – opening up DTC and e-commerce channels. Alongside this recent influx of e-commerce came access to exciting new data. When selling directly to consumers, suppliers can now see what, when, and where their customers are buying – all in real-time.

For the first time in the industry, suppliers have the capability to accurately observe and understand the consumer in real-time. These types of capabilities have left brands wondering why the large gap in customer data through wholesale channels continues to exist.

wine and spirits three tiered system

The long-standing wine and spirits three-tier system for wholesale distribution results in massive amounts of data living in completely separated worlds. If suppliers could simply compile and utilize all of this information related to each distributor, retailer, and the granular customer data, then the entire operation has the ability to shift from reactive to strategically proactive. Thanks to e-commerce shedding light on the depth and value of this level of consumer data, suppliers are now realizing the magnitude of bridging all the available data sets together. Once the dots connect between how many cases a distributor sold to a liquor store down the street with the number of bottles actually purchased, alongside which bottles at what price point, brands can start folding in proactive measures. In a business with a customer palate that is constantly evolving but without direct insight into what is or isn’t moving off the shelf, staying customer-obsessed is the only way to win.

Before diving into this concept of an integrated customer-centric route to market, let’s outline what a disconnected brand architecture looks like. Sales teams are pursuing accounts that are not profitable, and marketing teams are targeting zip codes where sales reps are not selling. If the sales and marketing data isn’t communicating, the sales and marketing strategies are also disconnected. Fragmented and delayed data leads teams to make decisions in siloes, resulting in wasted time and resources. This waste can be easily recovered through accurate, integrated data that align with marketing, sales, and financial initiatives. Cohesive intel empowers everyone within the organization to understand how to grow a profitable business in an efficient manner.

Playing a Different Game.

Data savvy companies are outperforming non-data savvy companies because in this industry, success is not rooted in having a better product but rather a better understanding the market. Brands with weak, disconnected data lack the customer insight needed to compete with those who do hold the keys to their customer journey. A few simple but powerful examples of how these brands are utilizing customer-focused intelligence solutions are outlined below:

1. Account Analysis & Consumer Targeting: When identifying new accounts to pursue, a sales team should first analyze the brand’s product portfolio in relation to the types of accounts that are currently profitable. By determining the attributes associated with successful accounts, they can then pull a list of look-alike accounts for growth opportunities and new markets for expansion. In conjunction with communicating that list of opportunities to distributors, the team can begin digital marketing efforts by advertising directly to consumers in those zip codes. Further, the financial team should utilize data intelligence to evaluate price positioning within the individual accounts and accurately track sales volume in order to improve margins and identify market gaps. Access to data at every touch-point provides teams with real-time insight into what is working and what to do next.

2. Marketing Campaigns & Strategies: A supplier can see there are 10 stores in a certain zip code where they are selling a specific product that is currently being promoted through digital marketing campaigns. In order to limit the risk of marketing spend and improve the impact of digital campaigns, the sales and marketing team can evaluate the conversions on the active campaign and adjust the approach where needed. By aggregating the available data and lining up against all retailer accounts in the targeted zip code, they can determine the correlation between media spend and consumer response to that specific product. Access to success metrics per campaign and audience enables teams to not only evaluate the overall marketing strategy but to hyper focus their efforts where they stand to maximize returns.

wine and spirits dashboard

Unified Analytics.

The wine and spirits market is packed with the data necessary to make such strategic business decisions, yet that information remains fragmented, expensive, and delayed. There is a huge competitive advantage to owning all data internally and externally available in a streamlined, consumer-centric format. With the rise of e-commerce, brands are becoming thirsty for full ownership of their distributor and consumer data so they can intuitively drive proactive decisions across teams. When everyone within an organization is taking action on the same data-informed message, a truly integrated and informed brand architecture evolves.

How Distilled Can Help.

As a team of data advocates and bourbon lovers, Untitled believes all industries and brands should have the opportunity to adopt data-informed strategy. Considering the state and pace of the present digital transformation era, a wine and spirits supplier should no longer be required to wait a month to understand the market today nor continue to operate in data darkness. At Untitled, we designed a decision intelligence solution to unify the data gap within the wine and spirits industry. Through Distilled by Untitled, brands can understand the market as it stands today, know when and how to communicate to the right consumers, and figure out how to get ahead of competitive trends.

Distilled offers a unique and comprehensive business intelligence experience to provide agile analytics on top of the critical data elements in the industry. If you’d like to learn more about Distilled and how our decision intelligence solution can support your brand, we would love to connect with you!

Emma Hixson

Author Emma Hixson

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