Part 2 – It’s All About Control
As a growing spirits brand, you may be familiar with direct-to-consumer (DTC) sales as a way to move more cases off the shelf. However, when it comes down to launching and sustaining an effective DTC strategy, there’s much more at stake than just increasing product distribution.
Innovate and Iterate Quickly with First Party Data
One of the superpowers of DTC e-commerce is that it helps brands to act quickly, pivot when necessary, and adapt when the market requires it. With access to customer data, teams can quickly identify areas of opportunity that can be improved upon or built out. As a result, not only can you effortlessly launch new products at a small scale, but you can also utilize first-party data to A/B test messaging.
To illustrate this, we look at a wine spritzer company. They currently offer three variations of their bubbly spiked refreshment. With a treasure trove of first-party data, they surveyed their best customers to understand which new flavors would resonate best.
Creating a DIY focus group of their core customers using customer data was easy:
First, with a few clicks to filter their list, they identified a segment of DTC customers that have purchased at least three times in the last year, have been active on their website in the previous month, and are actively engaging with their emails.
Then, using this list of engaged DTC customers as a focus group, they sent emails, surveys, and were able to engage their biggest brand advocates actively. This is one example of countless ways to leverage your DTC ecomm data to develop products and campaigns that resonate with your crowd.
Change is Inevitable, but it Doesn’t Have to be Painful
Whether you’re undergoing routine changes like launching a new SKU, recipe formulation, or navigating a major global crisis, switching up your approach immediately is an invaluable asset.
One clear example of the need to pivot quickly comes from the COVID-19 lockdowns. Some brands were ready for the dramatic shift in consumer behavior, favoring DTC and off-premise consumption. If your brand wasn’t selling direct-to-consumer in 2020, you were likely considering it.
NielsenIQ reported some staggering statistics about pandemic buying behavior changes that brands with a DTC ecomm presence could leverage for growth:
Online alcohol sales more than doubled (+234%) over pre-pandemic levels
Alcohol brands saw unprecedented demand for larger pack sizes:
Boxed wine up 10X, 1.75-liter spirits up 23X.
Beer saw sales increases in both 30-packs (+21%) and 24-packs (+20%)
Increased flexibility and control over your brand and sales pipeline make DTC a great way to hedge against unexpected bumps. Is your brand ready to not only weather, but thrive through the next market disruption?
Launch New Markets More Effectively
One of the biggest challenges for alcohol brands is launching new markets in retail before adequately introducing product to consumers. The retailer relationship is tricky, and with so much on the line, you want to do everything you can before launch. In this case, you’re looking to impress the end consumer and, most importantly, the buyers at retail. More often than not, you get one chance to prove yourself to the retailer before they give your space on the shelf to your competitor.
A handful of incredibly effective tactics will take your pre-launch awareness campaigns to the next level. One great tactic is lookalike advertising, where you target consumers who are likely to enjoy your spirit because they share similar characteristics to your existing customers.
Another effective way to prime your new market is by leveraging the consumer information gathered from your DTC ecomm website. This information allows you to optimize your digital awareness ad campaign spend, affording your brand more of the right kind of engagement with your target consumer.
By providing customers with the digitally-driven accessibility of an online store and further building the brand’s reputation through targeted marketing online, new brands can establish a strong presence in new territories in less time and with much less effort.
Is Your Brand Story Being Heard?
The potential for success with DTC e-commerce is immeasurable when you factor in the additional control over your product, messaging, and ability to innovate it offers you. DTC data informs how and where you launch new retail markets as well. Spirits brands that execute well on a DTC approach often find themselves well on their way to taking case sales to the next level across off-prem, on-prem, and no-prem.
From launch to major exit, we are your partners in driving real enterprise value growth for your brand. If your brand is ready to set off on a new growth trajectory and pull ahead of the competition, contact the digital strategy experts at Drinkubator today.