Ep. 464 Steve Raye U.S. Market-Ready | Put Your Money Where Their Mouth Is

Thanks for tuning in. I'm Steve Ray, author of How To Get US Market Ready. And in this podcast, I'm going to share with you some of the lessons I've learned from thirty years in the wine and spirits business, helping brands enter and grow in the US market. I've heard it said that experience is what you get when you don't get what you want. My goal with the book and this podcast is to share my experience and the lessons learned from it with you so you can apply those lessons and be successful in America. So let's get into it. Hi. This is Steve Ray. And this week on the Italian wine podcast, we're gonna be talking about how to put your money where their mouth is. And what we're talking about here is the importance of in store tastings. I've learned throughout my career that in store tastings are probably the most effective tool that wine and spirit brands, indeed, all food brands and wine and spirits as part of it can benefit from. It addresses some of the key needs that we need to know as marketers that one is somebody interested. Number two, Do they like the product and number three? Can they buy it right then? And do they have any questions and they can be answered? All of those things are boxes that get ticked off or checked off in an in store tasting. And make it such an effective tool. I would also add that in the era of COVID nineteen, we're seeing a lot of retailers adapt to the realities of the situation. Yes. They're putting up plastic dividers, but they're still doing tastings, finding ways to do it as in past dues. Perhaps even more importantly, though, is the way they've, pivoted, is the word that we use here these days, to taking a seven fifty bottle and repackaging a particular product in smaller containers, and then providing that to the consumer to do a taste. And you can do that remotely to a large group. And in fact, you can end up reaching many more people than you would if you did a traditional in store tasting only with the foot traffic to store. So let's get into the program. As I said, tastings are probably the most effective tool wine and spirit suppliers have to make a direct impact on moving more boxes while building the brand. And this is in contrast to couponing and discounting, which can also have a significant volume impact, but at the risk of undermining rather than building a brand. In a session, I, moderated at the recent wine to wine event question came in from one of the, producers. Should I be discounting? And the person I was interviewing, Edla Mae came back with a really great line. He said, retailers always remember the lowest price they paid for a particular bottle. So if you discount, it's a it's a very it it's it's a deep hole and you're heading one way down it. We think a much better way of doing things is to add value and insert tastings are a way to do that. In fact, the most successful retail promo programs are those that help individual accounts increase their volume and margins. If you think about it, on and off premise accounts are going to be a lot more interested in supporting the brands that support them directly and legally. Okay. Makes sense. I get that. How do I execute that through an importer through a distributor to retailers who I don't even know? Well, that's part of the challenge of communicating with your importer and coming up with programs usually on a cost share basis. But if you bring it up to them and start the conversation with, hey, I've got some money I want to invest in building the brand, they'll end up working with you. And I think a lot of cases people just want the importer to do it on their own, and the reality is they're not. You need to be working with them hand in hand and contributing to the support cost. But let's, talk more specifically about how all this works. You know, the key thing I think that and we're we're talking about brands here that are already in the store. Brand spots or tastings are the ones that are going to get the floor displays. If all you do is do a promotion tasting and you're selling bottles from that display table. That's okay. But what happens when you leave? I'd much rather make it a requirement or part of the program that you do the in store tasting, but along with that, you get a three or five case. Stacking of the product. So even when you're not there, people who heard about, but could not attend the tasting or put up a sign saying, this is the stuff that we tasted last week, and, it's on special this week. One of my favorite lines from when I was first learning in the industry is If it's not on the floor, it's not in the store. And in store tastings can be a great way of getting your product off the shelf and onto the floor. Using in store tastings to increase volume. Moving boxes is the name of the game. In one program we ran, we increased average sales per store sixteen times the day of the event, and we had pretty good, conversion afterwards. As a corollary, we've also seen that programs using poorly trained staff may generate only an average of eight to twelve bottles, while well trained motivated staff with good supervision can move thirty six to forty eight, four cases in a two hour tasting. And that's testimony not only to the program and how it's designed and the retailer support of it, but also the quality and the importance of staff training and retailer commitment. One of the other key components of the in store testing programs that I like to set up is to repeat the event, to agree with the retailer to put these events on at some periodic rate. So maybe every six months or maybe before key holidays depending on what your product is. But the idea is if you're in there in their store visible to them supporting your product, that's an extraordinarily powerful tool that's better than just doing a store visit when you come to the US market once or twice a year. And and even if it's by proxy where you hire a tasting agency to do this for you, maintain connection with the retailer to let them know that you are there supporting the store. So we like to schedule a series of events in a in a given store because it can dramatically increase the sell rate when you're not being promoted. The retailer will be more responsive to stocking inventory ahead of the tastings and reordering based on sales with data from their own store as opposed to something they heard from somebody else. So it's a great way for local sales, whether it's a distributor salesperson or if you have your own people in a given market to support your best accounts. The implicit message is is really the bottom line on all this. We're here to help you make more money, sell more wine. And if you sell more of our wine while you're doing that, we all win. I should mention that, many of these comments are for brands that are already being sold in the United States, and I get the question a lot. Well, what should I be doing to promote my brand to get it into the US. Well, that's a much bigger subject than just this, but I would suggest this to you. When you're talking with prospective importers, distributors, and also the retailers, make sure you build in a very effective and efficient in store tasting program as part of the brand offering. You're not just selling the brand. Remember, you have to promote the brand so that the retail store is going to recognize that as selling more volume and generating more revenue and more margin. Another thing I like to do, and, again, it it's a challenge for some brands, but if you're with the right importer, that's something that they can help you with, and that's to remind the trade that the brand moves. You know, even if your brand isn't the shiniest new product in the store, It is a brand that is a proven volume generator, and part of the foundation on which the retailer's business is based. They're making margin on you, and they keep you in the store because you're doing that for them. So as it as is often the case, the attention of management and line folks at the distributor or importer level is often diverted to other priorities. That happens all the time. Right? How do you keep their focus on you? Tastings? Keep your brand top of mind by making your brand sales velocity. And customer satisfaction strengths more visible to everybody in the chain. One way of letting people know what your brand is doing is by leveraging trade PR. And once again, not everybody has access or can do this, but if you're with an importer, who has some PR personnel, getting your success in in store trade tastings as part of a news release and then distributed to the trade, not consumer, to the trade magazines can make a big difference, especially when we're talking about the electronic newsletters. And if you go to my site, bevology inc dot com and click on blogs, you'll find a list of all of the industry newsletters that I think you ought to be subscribing to, most are free. And the three most important ones. And those are daily electronic newsletters. Everybody in the industry gets and reads first thing in the morning and how they find out about news. A mention in one of those is is better than a gold award. So, but back to, in store tastings, Let's put some metrics behind it. We think a good goal is to achieve a thirty percent conversion rate, and that means that thirty percent of the people tasting it purchased the product. And depending on the price point, that conversion rate can often be in multiple bottles purchased. Instead of just one, which is great. We also like to integrate ways, and I I won't go into specifics here, but you can imagine the utility of integrating social media and telefriend type programs about I just bought this product, and here's what I think about. In fact, we executed this particular promotion in what we considered second tier markets, and the conversion rates there reached almost sixty percent. And clearly, what what happened was showing a little love can pay off in spades and showing love in markets that may not be getting as much attention as New York. Los Angeles and Miami can be the smart way to be promoting your products. Focus on the smaller markets where there's not as much competition and they're appreciative of the ongoing support. It also worked with individual retails, but where we had corporate chain support, we nearly doubled the average number of bottles sold per event through an in store tasting program. So bottom line, there's a lot of great new promotion ideas out there and social media and e commerce and all that kind of stuff, and that's true. But you can always find ways to make store tasting, whether it's real and in store, or whether it's virtual, over the web or e commerce, key part of your promotion program. In fact, if all you do when you're coming to pitching importers and distributors, include your recognition that you're gonna allocate budget support for doing in store tastings. Tell them, a, you understand the market and, b, you understand really how to motivate people. It's not by spiffing them or giving them additional, incentive payments for focusing on your product. But you put the money in support of individual accounts, and that's an easy way for the distributor salesperson to sell it into those retail accounts. The importance of visibility can't be over stressed. I I use one example. I was working with a brand. It happened to be a kind of a Japanese wine. And we had some time. We were, exhibiting at the fancy food show in New York. And so I took the client to a couple of retail stores. And we walked into one and we asked him, do you have this particular category, not not the specific product? And he said, no. So we looked on the shelves, and of course, there it was. And we said, well, here it is. You're carrying it. Oh, yeah. I guess so. And I said, well, how's it doing for you? He said, I don't know. Let's go look. So he walked over to his computer, he turned the screen around and showed us and discovered for himself, my god. I'm selling Fifteen bottles a week of that stuff on a regular basis with big bumps on the holidays. The only thing we did was ask the question how the bottle is doing, and all of a sudden, he figured out that was a very important, full margin product that had regular clientele on a regular basis is one of the core pieces of his business, and he wasn't even aware of it. And that idea ties into the use of trade PR to not just do these programs, but let the world know that you're doing these programs. And by world, I mean the US trade industry. So bottom line for this week, one of the most critically important tools and simplest tools, and probably most cost efficient tools that brands have is to support in store tastings. If you're already in a store, it becomes a great way to get visibility and recognition from the retailer that you're supporting the brand in their particular store. And if you're not in the market yet, It's a great way of telling importers, distributors, and other decision makers that you get the US market. You understand how it works, and you recognize that these types of tools are so much more effective in adding value on an individual store basis than any amount of discounting. So that's it for this week. Thanks again. This is Steve Ray, for the Italian wine podcast, and we'll talk to you next week. Goodbye. This is Steve Ray saying, thanks again for listening on behalf of the Italian wine podcast. I've learned that everyone you meet deserves to be greeted with a smile.