SMALLER WINERIES BETTER AT ESCAPING DATA SILOS

It is no secret that Direct Marketing has gotten more complicated.

Printed communications have given way to digital communications, and digital communications are splintering into a million social digital conversations, and … well, I’m not sure what is next but I’m sure it will make what we’re working with now look easy.

We work furiously to adapt our messages based on the channel, select the channel based on customer responses, and evaluate to gain a better understanding of the consumer based on their behavior.

Wineries of all sizes struggle with connecting the dots on this data story.  This is primarily so hard because the customer behavior data is still being captured and managed in databases that are difficult to integrate, but, this is changing.

More and more wineries are finding ways to break down their data silos and realize the significant ROI potential of optimized customer engagement.   And, as I work on case studies and listen to speakers at our local conferences, what I see is that smaller wineries are leading the way as they leverage their ability to be more agile and make quicker decisions than their larger counterparts.

Data Siloed in Larger Wineries

For our local large beverage conglomerates, data silos are the result of customer data that is independently captured and managed by different departments within the organization. For example, a wine brand with years of history is likely to have a list of distribution sales data. And, then ten years ago they introduced an e-commerce site, leading to an email DTC marketing database and Wine Club. More recently, the same wine brand may have a hospitality site that started a Facebook page and began collecting visitor information for tasting room promotion.

Each of these marketing channels—retail, DTC, social, and mobile/site—have independent points of data capture.  More than likely they are also managed independently, by either different managers, or entirely different departments. If the company places high expectations on each of these departments to meet individual P&L goals and allocations, there is little incentive for these managers to share customer information and inventory.

Furthermore, many departments outsource the management and storage of their customer data of IT. And, IT supports everyone, not just marketing.  It is difficult in these circumstances for marketing to acquire the data, let alone integrate it, in a timely responsive fashion. All of these factors contribute to valuable data, in effect, being held hostage.

Smaller Wineries Have the Competitive Advantage

According to the PACE Benchmark Study conducted by 89 Degrees, nearly half of the surveyed companies are successfully adapting marketing messages to a channel, yet, 30% report the customer response data in these channels is siloed. Smaller companies (less than $1 billion in revenue) are doing a better job of overcoming silos and optimizing channel and customer engagement. Why?

1. Smaller wineries are more agile.  The larger the winery, the more likely it is that customer information is managed and stored via a third-party data warehouse. That means marketers must get the data they need from IT, which usually means filling out request forms and waiting for approval and delivery of the data. That is too long to wait for programs that are dependent on consumer behavior and response. Smaller companies tend to have their data closer at hand, and are able to apply consumer behavior to programs more quickly.
2. Smaller wineries are more likely to outsource.  As explained in the beginning of this article, as Direct Marketing channels explode it is hard to be an expert in everything.  Small wineries who focus on being an expert on wine and hire consultants in social media, events, marketing, PR, or other specialties tend to come out ahead of their neighbors.  Why? Agencies and consultants who understand the value of customer data can execute proven programs of customer engagement and meet aggressive business goals. Many times these results are difficult to achieve without the benefit of experience and keeping up with technology and trends in your specific area.
3. Smaller wineries are more likely to achieve a higher overall ROI (Return on Investment.)  In the same PACE study, smaller companies made up 87% of the high ROI group.  Because larger companies work in silos, they are more focused on optimizing their independent program.  Smaller companies, who take success past the program and focusing on channel and customer optimization, will achieve a higher ROI. For example, let’s say you’re planning a winemaker event in Atlanta at a retailer of a big winery.  The Georgia sales manger for this huge winery may have an email list and send out an invite.  The PR person at the corporate office “handling” the winemaker may do a press release, and the Wine Club manager at the brand winery site may put the event on the Facebook page.  Even though each of those efforts was completed, there is no coordination to see which channel was the most effective, whose customers came, and who purchased.  A smaller winery would know this because all the data would be in one place, and time and money is precious!

Keeping up with the Little Guys

To compete with smaller wineries in this new age of data coordination, larger companies will need to embrace technology and tools that increase their data access and lets them connect disparate digital data to create a universal customer ID that acts as a link between key customer touchpoints.

It’s going to require some different thinking at these wineries, but it will be more than worth it to escape from data silos and recognize their customers better than ever before.

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