Wine flowing freely on web

By PETER GRIFFIN technology writers

New Zealanders love a cold beer or a full-bodied wine to accompany their dining. But we hate making that trip to the local liquor store to pick up the booze. Clogged car parks, queues and cranky checkout staff can contribute to a depressing shopping experience.

But some liquor retailers have seized on the opportunity offered by such customer dissatisfaction. Using "clicks and mortar" operations, they can give customers an easier route to the cool store and extend marketing campaigns into cyberspace.

Lion Nathan's Liquor King chain was the first to move online. In Liquor King's case the marketing plan revolves not around providing booze cheaper on the site than off the shelf, but supplying a level of convenience that will encourage corporate and home users alike to log on and save themselves the footwork.

"This is convenience-based retailing. It's for people with mobility issues, businesses that want the convenience of the service. It's not about discounts. The last thing I want to talk about in any business to consumer model is price," says Craig Wilson, general manager of Liquor King Online.

When potential drink-buyers register at the Liquor King site, they enter their location and are automatically shown the closest Liquor King store. Next time they log in, they are routed to the local store. The liquor is organised and delivered from that local store for a fee of up to $10, depending on where you are and how urgently you need a drink.

By making its nationwide network of retailers the centre of the process, Liquor King ensures they are not disenfranchised by its online offering.

"It's in the managers' best interests to promote the site because they get the benefit of the sale," says Mr Wilson.

Registration also requires you to divulge a number of details about yourself. Your traits and habits that will be fed into the Liquor King database, providing valuable marketing information.

Questions range from what sports you are interested in, what earning bracket you belong to and whether you've bought over the internet in the past.

The information forms the basis for Liquor King's online-related promotions and marketing programmes, which include targeted e-mail updates of specials.

Multi-channel marketing is the key, however. Online advertising attracts web traffic from sites such as nzoom.co.nz, but this is combined with advertising campaigns such as the Buy Naked campaign ran over summer on billboards.

Specials exclusive to cyberspace appear online, and registered users receive e-vouchers in the mail which can be used to receive discounts online.

"People also use the site as a shop window and then go into the conventional stores to make a purchase."

While Liquor King will not reveal how many people visit the site or how much was spent on setting it up, Mr Wilson says 31 per cent of customers are new to buying over the net on registration.

In the case of the country's biggest specialist wine e-tailer - finewineonline.co.nz - big billboards and flashy TV and radio adverts are out. Customers are spreading the gospel across the web.

Jeff Poole, founder and managing director of www.finewineonline.co.nz is candid about the marketing techniques used to build up a database of more than 7000 users.

"Our biggest success has come from referrals.

"There's no big secret and we're not spending big money,"s.

"It's happening because we're offering a good selection of wine online, good sound advice, good site maintenance and good customer service."

From its warehouse and sole retail outlet on Hobson St in Auckland, Fine Wines Online delivers around the country.

Customers pay via the site using a credit card, paying an average $240 for wine by the case.

Poole says lower overheads and the success of inexpensive marketing enables the company to offer $20 wines at a $3 to $4 discount.

"We don't want to be a Liquor King-type operation. We're not going to have stores on every corner. That defeats the purpose of our business which is about managing overheads and giving customers a great price."

Once again, marketing flows through a range of channels. Monthly specials are mailed out to the customer base in the Wine Buying Guide, which also includes reviews of 150 to 200 wines. The mail-out is supplemented with weekly e-mail updates containing wine news and further good deals.

Free wine-tasting is held weekly and includes visiting wine growers from around the world.

Four times a year the company takes to the road with about 80 wines for its Fine Wine Expo. The roadshow is key to the marketing campaign targeting areas outside Auckland and is proving very successful.

One of the most important aspects of marketing, says Poole, is letting customers know what the retailer will do if it can't deliver, a scenario that is bound to happen from time to time.

"We see a customer problem as a customer opportunity. If they aren't happy we'll replace it and talk to them about what sort of wine they want ... Wine, after all, is a very personal thing."

And the marketing mix is working. Poole says online operations now account for 17 per cent of business, up from 3 per cent the same time last year.

But the supermarkets are also moving online. They bring marketing muscle which can reach customers through every existing channel from nationwide mailshots and TV advertising campaigns to online specials and e-mail campaigns.

Wine overtook bread in December for first place at the checkout.

In the run up to Christmas we bought $309 million worth of wine in supermarkets. Beer has a longer way to go, partly because it was allowed into supermarkets only a little more than a year ago.

But the marketing techniques working to shift large quantities of wine from shelves in supermarkets can be applied to the frothy stuff too.

Woolworths charges an average of $15 for delivery, but with buyers able to include liquor purchases with their grocery orders, the deal seems more attractive.

This year overseas e-tailers such as bestbuy.com, egghead.com and bluelight.com have all been hit by significant performance drops and delivery holdups.

Not only do the glitches frustrate an already sceptical customer base, but they make a mockery of marketing campaigns based around themes of convenience and cost savings.

Mr Poole says winning the confidence of customers that they won't be left high and dry on the eve of a dinner party must be a serious objective of any marketing activity. Without that confidence, we will brave the crowded car park to ensure we quench our thirst.

Links

Liquor King Online

Fine Wine Online

Best Buy

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