Proper Tack #58: Let's Drink Wine and Go Shopping

Let's Drink Some Wine and Go Shopping

Alcohol marketing is super interesting. It's an almost perfect commodity for 95% of consumers (vodka is vodka, light beer is light beer, red wine is red wine) and yet you can charge 2-to-20 times as much for a "premium" version of each of these when compared to the low-end. We'll save the liquor and beer markets for another time, because they have their own fun nuances, and focus on wine today. And in particular, the way winemakers grow their audiences through education rather than lifestyle advertising.

So grab a glass (or a bottle, I'm very partial to this one) and let's get into it.

🍷 What you can learn about marketing from the wine industry

💯 Instagram is embedding shopping in its platform and all of those influencers you follow just got a lot more powerful

🎯 And finally, a few interesting content pieces I've found recently

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This entry's header palette is Early Spring Rains.

1. Wine Marketing is Education

https://hbr.org/2019/03/what-the-u-s-wine-industry-understands-about-connecting-with-customers
Two of the most common classes in any marketing curriculum are Marketing Research and Consumer Behavior. The course names may change from school to school, but you get it ingrained in your head that studying what customers want and how they react to products is vital to a company's success.

And then there's the wine industry.

Wine marketing has evolved a lot over the last 20-30 years and is massively different than most of what you see from other products. If you go back to the 70s and 80s you actually had a decent number of wine commercials on tv. Think of the last time you saw a wine commercial. I'll wait.

Those old commercials tried to build the mystique of wine as an ultra high end, almost unattainable good, even though the price point wasn't anything outrageous. Beer was fun. Liquor was fun. But if you weren't smart enough to know about wine, you didn't need to bother trying to drink it.

In some ways that aura has lived on, and wine can still be an incredibly intimidating purchase. What if you choose the wrong wine for your meal, will the waiter think you're uncultured? And all those bottles at the wine store, how are you supposed to narrow down hundreds of options in to the one bottle?

When consumers don't know what they want, the right solution isn't running more focus groups, it's educating them. And this is what the wine industry does better than almost anyone. So much of wine marketing centers on education now. You have wine tasting classes, winery tours, and expert reviewers whose ratings end up on store shelves. Even if you don't know what you want, you can see that Robert Parker or Wine Spectator gave that $13 bottle of Sauvignon Blanc a 96 and feel really good about your purchase.

The world of complex or intimidating products goes well beyond wine, though, and the HBR article above lists out three steps that any company can employ to start using eduction to grow the business.

Envision Something Extraordinary
Wine didn't turn into a commodity good, it's still something aspirational

Mobilize Those with Influence
Winemakers engage with key critics and publications to tell their full story and build emotional connections, not just push their products

Let Consumers React and Share
As you educate the next step of buyers (wine stores, restaurants, etc), you empower them to share their education with more end consumers.

When you can use education to shape how people view an entire product category you are much less vulnerable to disruption. Your competitors aren't trying to

2. Instagram Launches Selling

https://techcrunch.com/2019/03/19/instagram-checkout/

Instagram finally announced a long rumored in-app shopping experience this week. There were talks at one point of a standalone app for Instagram Shopping (a true QVC for millennials) but it looks like we'll be able to keep all of our 'gramming in a single app instead.

Below is a short video that takes you through the entire Instagram checkout process. It looks pretty smooth overall, although I'm not sure the callout that a post is shoppable, and how to get started are super clear.

For providing this service, Instagram will be taking an undisclosed percentage of the total sale. They will also be storing the users' credit cards which means that future in-app purchasing from any merchant will be very easy. Between Shopping and the recently announced Fundraisers functionality, Instagram (and therefore Facebook) is going to start building up a database of payment information very quickly.

Of course one outcome of this is that Facebook is going to know more than they already do about what you buy and how you're buying it. That information, in turn, is going to make their advertising options much more powerful for merchants, who will now be able to get past the attribution problems of ecommerce by measuring transactions directly in the platform where the ads and organic posts live.

Once this functionality is ready for prime time I think we'll also see ways for brands to extend the checkout options to their influencers and spokespeople. Imagine LeBron James posting his new shoe on Instagram and you being able to go from his post directly into a purchase flow that sends the order off to Nike. In that world you don't even have to engage with Nike directly, and they have the most accurate ROI calculations they've ever seen on direct purchasing from third-party posting.

Also interesting, although not too surprising, is that Apple Pay is not a payment option. You can use PayPal or any of the 4 major credit cards with PayPal handling the processing side of things. Apple and Facebook (and Amazon and Google, for that matter) play nicely with each other, but are wary of helping the other grow. I actually wouldn't be surprised to see Facebook build out their own payments infrastructure if Shopping is successful. After all, there's no reason to give PayPal a chunk of every transaction for 9-figure sales channel.

As far as when this will roll out to the masses, there's no timeline at the moment. I looked at the ecommerce platforms that the initial 20 pilot customers were on and all the big players are represented (Demandware, Oracle Commerce, Shopify, Magento) and they also called out BigCommerce so it seems like integrations won't be an issue.

I feel confident that extensible shopping is going to be a big thing in the very near future, and it's not going to stop with Instagram. You're going to see this on Pinterest, Snapchat, embedded brand ads, search results, etc. Omni-channel to date has meant online (meaning maybe 2 channels: owned ecommerce and Amazon) and offline, but it's about to be a lot more complex, and a lot more impactful.

Let's Drink Some Wine and Go Shopping

1. Wine Marketing is Education

2. Instagram Launches Selling

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