Talkin Tech: Local Market Conditions: Opportunities for Online Wine Sales Are Not the Same for All Stores
Posted on | July 19, 2011
Written by | Ian Griffith
Helping customers and sourcing product is the daily work of running a store, and you tend to take for granted the conditions of your local market. For example, the prevalence of price posting in the northeast has been a significant factor in creating a number of opportunities for the trade.
Comparing the conditions in different states, it is clear that opportunities for online wine sales are not the same for all stores. In some cases, the structure of the local market that supports your store can work against your efforts to grow online. State regulators, wineries,distributors and trade associations often have competing agendas.
- First and foremost, an E-Commerce website needs to show the inventory a store carries. If the store doesn’t have something interesting to say about its products, then the website is likely to become lost in the crowd. A vibrant community with a taste for good food and wine is the foundation of a thriving wine store and by extension that store’s website. Differentiation online is crucial, and one of the main ways you do this is through your buying decisions.
- Access to a mix of product sources supports variety in your selection. While some states allow retailers to buy direct from wineries or to sell food, many markets do not. The largest wholesalers do a great job of distributing important brands but you also need to seek out new products that represent value and give you a story to tell that is different from your competitors. Wholesalers can be important political allies for retailers when it comes to reinforcing local business conditions; however, they are diligent protectors of their unique role in the three-tier system.
- Stores in several states are restricted from making deliveries to consumers. These restrictions can range from requiring all orders be picked up at the store, to deliveries by store employees only, to restriction on shipping out of the state. These are probably the greatest barriers for a store with ambitions of growing online. While consumers will likely use your website to research a visit to the store, this is rarely recognized as a strategic investment for a store unless there is revenue passing through the shopping cart.
- In some states, retailers compete with groceries and convenience stores to sell wine and beer to consumers. Other states have limits on the number of licenses under the same ownership, or require beer be sold under a different type of license.Depending on your market you may carry all types of alcoholic beverages, or if grocery stores offer the convenience of access to mainstream brands your best opportunity may be to become a specialist,where the opportunity is much improved online.
- Depending on where your store is located you may be lucky enough to operate in an E-Commerce-friendly market. Before investing in your online presence it makes sense to check your expectations against your local market conditions.