Wine Tasting Room Essentials
Winery Tasting Room Essentials, from Penn State Extension,
by Kathy Kelley, Professor of Horticultural Marketing and Business Management
Read the article online, click here.
Wineries that offer tastings create a relationship with their customers, encouraging them to purchase wines at the vineyard, and also increase future sales at state-run liquor stores and restaurants.
Introduction: Winery Tasting Room Essentials
Any experienced retailer will tell new entrepreneurs that a key to being successful is offering customers something unique, which ultimately differentiates them from their competition. In today’s market place, with the number of options consumers have in terms of purchasing retail goods and services, it is essential to implement a marketing strategy that will offer an unparalleled experience. As a result, wineries create a destination, such as a tasting room, where customers can participate in the process of tasting and evaluating the ‘fruits’ of the winemaster’s hard work and cultivar selection. Wineries that offer tastings create a relationship with their customers, encouraging them to purchase wines at the vineyard, and also increase future sales at state-run liquor stores and restaurants. Bottles purchased at the winery will inevitably remind them of their experience and hopefully encourage them to make a return visit when their supply becomes depleted.
Who typically drinks wine?
Demographic information that describes wine drinkers, your potential customers, has been collected for several years. Sources suggest that anywhere from 31 to 39 percent of U.S. consumers, age 21 and older, drink wine (Anonymous, 2003; Levine and Pownall, 2004). Other sources report that approximately one-third of wine drinkers have a household income of at least $75,000, nearly 40 percent have attended some college, and nearly half are between 35 and 54 years of age. As the U.S. population ages, members of the Millennial generation (born between 1978 and 1990) are increasingly becoming wine consumers. These wine drinkers, with numbers that rival the Baby Boom, are sure to positively impact the amount of wine purchased in coming years. How you market to this group may differ from how you market to more mature generations. According to one source, these younger consumers are eager to try new, unique varieties, but also are attracted by distinctive labels, packaging, and promotions.
Promoting your winery by offering samples of your wine
Promotion includes any effort that informs consumers about your business and the goods and services you offer. If successful, it connects with them on an emotional level and persuades them to seek out your wines in liquor stores or when choosing from a restaurant’s wine list. Promotion is not only necessary to attract the attention of consumers unfamiliar with your business, but to remind existing customers that your wines can help them celebrate joyous and festive occasions.
Some common ways wineries promote their tasting room and their wines include hosting events, participating in community and county festivals, creating an informative website, or sending mail directly to customers who are members of their loyalty program. Implementing a combination of these promotional activities will certainly attract the clientele you desire.
Promotional activities alone won’t entice visitors to make a purchase, rather tasting room employees need to be well educated about wines that customers can sample. Not only will employees need to understand the order in which wines should be sampled (from dry to sweet), but they should be able to talk about the various flavors, how the wines were created and in what year they were bottled, what foods they complement, and when they should be served during a meal. In addition, employees should suggest gift items and other merchandise, sold in the tasting room, which would coordinate with the customer’s purchase. If special events will be hosted at the vineyard, employees should promote the activities and inform guests about any upcoming festivals or special tastings, as well as opportunities to become a member of the winery’s buying club. Your employees should always try to exceed your customers’ expectation for service. With 23 percent of wine drinkers, classified as “overwhelmed,” and in need of guidance, it is essential that tasting room staff help these consumers choose an appealing selection that serves as the finishing touch for any dinner party. Meeting the needs of consumers in this capacity helps create customer loyalty which leads to an increased number of future bottles purchased.
Deciding whether to charge a fee for sample
Charging a tasting fee for samples has become a common practice in certain regions, such as the Finger Lakes in New York or Napa and Sonoma Valley in California, where consumers visit several wineries at a time. Changing a small fee of one or two dollars a person can help some wineries justify offering this service when patrons do not purchase a bottle after enjoying samples. Other winery owners use higher fees of five dollars or more to exclude those whose primary purpose is simply to obtain free samples. In hopes of not discouraging would-be buyers from paying the fee and sampling wines, many establishments do apply the tasting fee towards any bottle the customer does purchase.
Tasting room atmospherics
Before planning the layout and coordination of the tasting room it will be necessary to determine the location of the facility. Most wineries build a tasting room on the vineyard’s property or add space to existing buildings. Wineries with vineyards in remote locations that are difficult to travel to will often build a facility closer to the consumer market. This decision will ultimately depend upon whether the tasting room is located in a region near other businesses that attract tourists or generate enough consumer traffic to warrant the stand alone facility.
When a consumer enters your tasting room to sample wines, it is not only the flavor of the vintage that encourages them to ask question and learn about your other selections, but the design and layout of the exterior and interior of the tasting room. The aesthetics can either provide a relaxing environment that encourages customers to linger, or discourage them from even asking for a sample. Tasting rooms where soothing music is broadcasted through a surround sound system, with walls painted with appealing colors and adorned with tasteful art and décor, that contain a bar carved out of wood, a picture window over looking a display garden or forest, are much more aesthetically pleasing than a room with white walls, a sterile environment, and folding tables used to hold wine battles and patrons’ glasses. Simple aesthetic changes can certainly make the tasting room more inviting.
In addition to having an indoor tasting area, invite customers to purchase a bottle of wine and enjoy the view of the mountains from a deck or patio. By placing a few café tables and chairs outside, you can encourage your customers to spend even more time with you, potentially increasing the amount of wine and food purchased.
Offering more than wine: Tie-in sales
Consumers who visit a winery may expect to find other related merchandise. Wineries report that non-wine merchandise accounts for 20 to 30 percent of sales. Goods that are associated with drinking wine, and could be sold, include: wine glasses, wine glass charms, napkins and placemats with a vine motif, coasters, wine holders and racks, CDs (don’t forget to play them in the tasting room to encourage customers to purchase what they hear), cards and other stationery, cookbooks featuring local cuisine, books for the novice on growing wine grapes, pictures and murals, and perishable items such as cheese, bread, fruit cups, small pastries and other sweets, and crackers and wine biscuits. Determining the amount of accessories that can be sold is dependent upon the amount of floor space available. Wineries can also offer customers the option of purchasing bottles of their favor wine with custom labels.
Hosting special events and participating in festivals
Consumers who travel to your winery demonstrate that they have an interest in your goods and services. Hosting the event over several days, such as a weekend, can increase the number of visitors, or the number of visits for some attendees. With the amount of planning, promotion, and implementation a successful and worthwhile event requires, offering the event for more than one day will help recover costs faster if sales exceed the amount of wine and other goods purchased on non-event days. Once attendees have arrived it is your opportunity to involve them in an experience that engages each of their senses.
Use Your Senses!
Sight: Arrange for displays to view and local artist’s wares to purchase.
Sound: Set up a stage and invite local artists to perform or play a selection of music from CDs that you offer for purchase.
Touch: Allow attendees to walk through vines and feel the grapes and grape leaves.
Smell and taste: Offer samples and teach customers how to truly enjoy a glass of wine by taking note of the aroma and the flavor. Invite a local bakery to sell specialty breads, pastries, and cheese; all comlementing your wine.
An advantage of hosting an event at the winery rather than at a festival with other wineries is that consumers will be completely focused on your wines and won’t be distracted from other offerings. Consumers who attend community or county festivals may not be there primarily to sample wines, but to view displays or watch performers. Not only will you be competing with other vendors, but vendors that may also offer wines.
Offering a small gift, such as a wine glass etched with your company’s logo and name, can be used to commemorate the event and further promote your business. Every time an attendee uses their glass and drinks from it they will remember your event and their overall experience. Gifts or incentives you offer your customers have the potential to remind them of the goods and services you provide and encourage them to visit your tasting room again, as well as purchase your wines from retailers or when dining in restaurants.
Winery tours and seminars
Research has shown that the longer a consumer spends looking at merchandise in a store, the more likely they are to make a purchase. A winery can prolong the visit by increasing the number of wines a customer can sample and the amount of merchandise to browse through. By offering a tour, a winery can increase consumer interest and help build a relationship with them. Showing customers what a cluster of grapes looks like when growing on a vine, how grapes are pressed and how the juice is processed into wine, and how wine is bottled, can further involve and connect them with your business. A winery can also offer short seminars, for free, or all day educational sessions, for a fee, on topics such as growing grapes at home or how to select a wine for a dinner party. Either effort can appeal to those who desire the opportunity to learn more about wine, how it is grown, and how to have the best experience.
As mentioned previously, promotion not only informs but it also reminds customers about your offering. One way to continually target existing customers or consumers who have visited your website is to develop a newsletter that can be distributed quarterly or before holidays and events. Deciding on e-mail versus the U.S. Mail will depend on how many of your customers have access to the Internet. Remember to ask for your customers for their contact information when they subscribe: home address, telephone number (to confirm orders or if questions arise), and e-mail address. To tailor the content of the newsletter or to alert customers about the availability of special collections, ask them for more personal information such as whether they prefer white, red, blush, or all types of wine; specific vintages they enjoy and purchase most often; and quantity they usually purchase within a selected time period (month, season, or year). In addition, ask participants for their date of birth and anniversary. You can then send them special promotional offers to help them celebrate their special day.
Whatever method of distribution is chosen, a newsletter is your opportunity to educate your consumers about when to use your white wines and when to use your reds, how to cook with wines, inform them about upcoming events and promotions, notify them of any discontinued or limited wines and merchandise, and announce any expansions or employee promotions at the winery. This is also an opportunity to keep your customer list current by asking subscribers to update their personal and contact information.
Loyalty programs are used throughout many industries to build relationships with clientele and reward them with discounts based on the number and amount of purchases they make. Several types of loyalty programs can be offered. Basic programs that are free and provide benefits to all customers who sign-up is one option. Another option is to offer an exclusive program which requires participants to purchase a certain amount of products to be considered for enrollment, but offer benefits that range from free bottles of wine when new offerings are released or opportunities to purchase limited edition vintages are offered. Program benefits could also include: a newsletter specifically for members, advanced notice of events and sales, invitations to exclusive events at the winery, discounts if full or half cases of wines are purchased, free shipping, or access to a 1-800 number for the winery that is available only to loyalty program participants.
As with all other retailers, promoting your business, the goods and services you offer, and building a lasting relationship with your clientele will take time and effort. Promotion allows retailers to inform consumers about their establishment, but an ongoing endeavor is needed to remind them to purchase from you again and again. Offering a good quality product is the first step in becoming sustainable and successful. Sales of domestic wine, as well as volume produced, have increased during 2004 and 2005. As the number and types of wine have increased, more consumers are becoming repeat purchasers. Take advantage of this trend and create a tasting room that allows consumers to learn about, sample, and convert them into customers is becoming a necessity for some wineries as more and more people select wine as their alcoholic beverage of choice.