The rise of eCommerce has created new opportunities and challenges for wine brands. From enterprise- and micro-wineries, to liquor retailers and boutique bottle shops, merchants who traditionally relied exclusively on in-person sales are now leveraging digital solutions to better connect with their customers and establish new streams of revenue.
However, due to government regulations, increased competition in the space, and a general lack of technical expertise among stakeholders, many wine brands struggle to successfully bring their customer experience online. If that sounds like your winery or store, keep reading for helpful tips and insights on how to sell wine online.
DTC wine in a post-pandemic world
Before we get into the nitty gritty, it’s important to understand the current state of the wine industry, and the irreversible changes that it’s experienced over the last few years.
When the COVID-19 pandemic hit, wine businesses—many of which had outdated websites and an archaic tech stack—were forced to rely exclusively on online sales. Demand for digital wine-shopping experiences exploded among consumers. And now, online purchases make up 23% of all direct-to-consumer (DTC) wine sales.
Today’s consumers—especially those of the Millennial and Gen-Z generations—expect fast, accessible, and intuitive eCommerce experiences that allow them to purchase wine like any other product. As a growing number of consumers prefer online stores to physical stores, more wine producers, distributors, and retailers enter the eCommerce space, putting pressure on less technologically savvy companies to modernize their digital presence.
With the right blend of custom and third-party solutions, your wine brand can keep up with customer expectations, maintain its competitive edge, and take advantage of new growth opportunities. But before you can start driving eCommerce sales, there are certain alcohol-industry hurdles that all wine brands must overcome.
Requirements for eCommerce wine merchants
If your business is new to the eCommerce alcohol space, it’s worth going over some basic requirements that could act as roadblocks if not addressed properly. Here are four key considerations for companies preparing to sell wine online:
Confirming buyer age
How will you ensure that your eCommerce store’s customers are above the legal drinking age? There are several ways to go about this. You can implement a third-party age verification service, or require customers to present their ID at the point of delivery.
Some states have specific requirements for wine merchants in regards to age verification, so make sure to be in tune with those. You should also look at what your competitors are doing on their sites to help determine the best approach.
Acquiring licenses
Required documentation for selling wine to consumers online varies from state to state. In general, your business will likely need:
- A state-issued winery license.
- A state-issued retailer’ license.
- A shipper’s license for each state you plan on delivering products to.
- Direct shipping agreements with each of your carriers.
- An alcohol dealer registration, filed and approved by the Alcohol and Tobacco Tax and Trade Bureau (TTB).
Complying with state, federal, and international shipping laws
Again, the laws around delivering wine to consumers change depending on the state. For example, most states allow wineries to ship products directly to their customers, but have limitations on volume. And some states—like Utah and Alabama—are totally dry, prohibiting any and all DTC alcohol shipments. To see a full breakdown of the current rules in each state, check out this helpful resource.
Unsurprisingly, things get more complicated as you expand internationally. Your business will need additional certifications for each country, and your products will have to go through multiple carriers and processing centers to be imported.
Paying taxes
To sell and distributes wine in the US, your business will need to comply with:
- Federal excise tax
- State excise tax
- Sales tax
- Mark-up tax
It’s important to note that the wine industry’s compliance requirements for licensing, shipping, and taxes are constantly changing, both on a federal and state level. Fortunately, there are sophisticated third-party solutions—such as ShipStation and Avalara—that can be implemented to stay on top of these changes, avoid penalties, and automate time-consuming, error-prone tasks involved in all forms of compliance management.
Tips for selling wine online
Once your business has the technological infrastructure to legally and effectively sell and distribute wine via eCommerce, you can focus on optimizing the customer experience. Here are some important tips for increasing buyer engagement, conversions, and sales on digital channels:
Design a modern UX and UI
Your brand’s eCommerce storefront—from its product listing pages (PLPs) and product detail pages (PDPs), to its shopping cart and checkout—should have a user-friendly design and fast page-loading times. And it should be optimized for all browsers and devices.
Personalize the customer experience
In addition to a fast, intuitive browsing and checkout experience, today’s consumers expect personalized product recommendations, discounts, CTAs, emails, and other content from eCommerce stores.
For example, by collecting customer browsing and purchasing data, you can better understand the tastes of individual buyers, and provide tailored wine recommendations for them next time they visit your site. This may sound like a lot of work, but with advanced site integrations, the whole process can be automated.
Highlight brand differentiators
What makes your wine different from all the other bottles out there? How does your company give back to its community? These points should be front and center on your marketing site, product pages, social media, and so on.
Also, today’s consumers are much more conscientious about personal health and sustainability, which plays a big role in their purchasing decisions. So make sure to highlight your brand’s organic products and eco-friendly production practices as much as possible.
Provide social proof
Customers want to read reviews from other customers before they make a purchase online, since they’re not able to see—or in this case, taste—the product beforehand. Displaying reviews and ratings on product pages will help curb buyer anxiety, resulting in higher sales.
Start a wine club or subscription service
Most successful eCommerce wine merchants have a club or subscription service that allows customers to set up recurring orders and receive special discounts. Providing a portal where customers can sign up, receive updates, make payments, and manage subscriptions will help increase customer loyalty and establish predictable revenue month over month.
Go multi-channel
To reach a wider audience and sell more wine, try implementing new sales and marketing channels, such as online marketplaces, social media platforms, email, and SMS. With a robust eCommerce platform like Shopify or BigCommerce, you can connect multiple sales channels to a single payment processing solution, and manage the data from each via a centralized dashboard.
Offer an attractive shipping and returns policy
Consumers prefer to shop with brands that offer free shipping and simple returns, as well as the ability to buy online and pick up in store (BOPIS). This is more difficult for alcohol brands than regular eCommerce merchants, due to the extra taxes and shipping regulations. But with the right order fulfillment tools, you can develop a cost-efficient system that keeps your customers happy.
Transform your wine brand with powerful eCommerce solutions
Whether you’re trying to enable online sales, streamline order fulfillment, build a subscription service, boost customer engagement across channels, or all of the above, Codal can help grow your wine business with cutting-edge, data-driven solutions and technical insight.
Our award-winning team has designed, developed, tested, launched, and managed a wide range of eCommerce experiences, including a recently-launched DTC online store that sells and ships alcoholic beverages to consumers across the US. You can learn more about that project here.
In addition to the world’s brightest designers and engineers, Codal has partnerships with leading eCommerce technology providers, namely Shopify and BigCommerce—both of which provide off-the-shelf solutions for maintaining industry compliance when selling alcohol online. With our team’s years of experience, superior development practices, and extensive partnership network, Codal has the tools, resources, and expertise to uncork your wine brand’s full potential.
Interested in learning more? Get in touch with a member of our team today!
