Key considerations for alcohol brands launching a D2C store

Manufacturers are moving wholesale into digital commerce. Yet the journey towards selling online is unique to each business. For some the path is straightforward. For others, it’s a digital odyssey, fraught with higher hurdles and rolling hills of complex regulations.

Alcohol brands are compelled to walk the second path. That’s because the alcohol industry operates within a distinctive set of challenges that make the move into digital commerce difficult.

The intersection of stringent age verification requirements, complex licensing procedures, and varying state and international regulations creates a landscape where compliance is paramount, and missteps can be costly.

Despite these digital barriers, alcohol ecommerce is booming globally. The US, UK, and Australia make up the top 10 alcohol markets and top 5 in terms of value growth. By the end of 2023, global alcohol sales are forecast to deliver $21.6 billion, according to new data from the IWSR, a leading source on the subject.

Last year, premium brands of beer, spirits, and wines all outperformed their standard counterparts, which much of this driven by younger adults. The IWSR expect the trend of premiumization to continue.

Interestingly, sales channels differ by country. In Australia and the UK, one of the main focuses is on omnichannel. In the US, it is much more diversified, with considerable value coming from D2Cs. In fact, North America is home to the highest amount of alcohol D2C ecommerce sales.

D2C ecommerce

While the pandemic was accelerating the growth of digital commerce, we were also drinking more. One study found a 14% increase in alcohol consumption beginning in early 2020. With restrictions in place, cracking open a can or uncorking our favorite bottles meant going online to order.

It also meant a huge opportunity for alcohol brands to go direct to their consumers. A direct-to-consumer (D2C) channel enables companies to capture increased demand for their products, better address distribution hurdles, and provides greater control over every aspect of the customer experience – all without the need of third-party distributors.

To capture these range of benefits, launching a D2C requires a robust ecommerce platform that is capable of handling the nuanced complexities of the alcohol industry. One of these platforms is Salesforce Commerce Cloud.

In addition to its adaptability to the unique challenges of the alcohol industry, Salesforce Commerce Cloud features seamless integration capabilities, comprehensive analytics tools, personalization, and scalability – everything to facilitate a first-class, end-to-end D2C experience.

As an international digital commerce agency, Tryzens works with all leading platforms and technologies to architect best-in-class solutions that fit the unique needs of each business. As a certified Salesforce partner, we have developed expertise in unlocking digital growth for brands using the platform. This includes implementing D2C strategies for global alcohol brands. 

Penfolds partners with Tryzens for D2C launch

Penfolds is a heritage-listed, premier wine producer with a rich history spanning more than 175 years. It has crafted a distinguished reputation as one of Australia’s most celebrated winemakers.

In 2018, Penfolds partnered with Tryzens to migrate and enhance its D2C store, in conjunction with over 20 other Treasury Wine Estates wineries worldwide. Penfolds managed to expand its global reach, develop award-winning omnichannel capabilities, and accelerate growth, including: 

• 117% increase in the conversion rate 

• 70% of sales driven by online 

• 17% increase in returning customer

If you’re looking to venture into digital commerce, then here are some key considerations before launching a D2C store.

Key considerations for launching a D2C store

1. Age verification 

Unlike almost all other consumer packed goods verticals, age verification is a necessity for alcohol. As such, it needs to be embedded into the digital experience to ensure compliance with legal requirements in the country’s that a brand operates in.

We developed an age verification page for Penfold’s website that is tailored to each country’s legal requirements. The user-friendly design and feel keeps the consistency of the brand’s aesthetics while fulfilling its role of verifying the user’s age as well as clearly communicating how the data will be stored and used. 

2. Regulatory compliance 

Launching a D2C platform for alcohol sales requires meticulous attention to regulatory compliance due to the stringent and varying laws surrounding the distribution and sale of alcoholic beverages. This is made more complex when sales operations are international.

Salesforce Commerce Cloud allows businesses to navigate regulatory complexities efficiently. The platform can integrate with age verification services, enabling automated checks and customizable workflows to ensure compliance with regional legal requirements. It also supports various payment gateways and tax calculation services to manage the intricacies of alcohol taxation while protecting sensitive customer data.

3. Shipping & transportation 

Important for alcohol in general and wine in particular; keeping bottles in a temperature-controlled environment is essential to preserve their quality and characteristics. From the wine barrel to the doorbell of the customer, there are various points in the winemaking and distribution process where consistent conditions are crucial.

Shipping and transportation are pivotal moments in this journey. Ensuring safe transit requires special measures to safeguard the flavor profile and integrity of the wine during transportation. Digital commerce platforms play a key role by facilitating integrated solutions that ensure the careful handling and controlled environment of products.

This can include real-time data on temperature and humidity for proactive monitoring and adjustments. It can also include allowing customers to track shipments, allowing greater transparency around the delivery process.

4. Brand storytelling 

Having a digital presence enables businesses to not only sell their products but also engage and educate customers about these products as well as communicate the brand story. This is crucial for businesses that sell food and drink because of the heightened sensory significance of the products.

A good example of this was the tasting notes project at Penfolds where we digitized their tasting notes library and made it accessible through their website with an intuitive UI.

Implementing each page using Salesforce Commerce Cloud Page Designer, customers can browse the unique history of each Penfolds wine and filter by range, variety, and vintage. Each tasting notes page showcases a rich image and detailed description of each bottle, including the grape variety, color, nose, palate, and peak drinking.

5. Building loyalty experiences 

D2C businesses with their own ecommerce platform have greater control over how they deliver customer experiences. They can build loyalty strategies that are interwoven with the brand’s identity, which can include anything from special offers, quality customer service and exclusive benefits to personalized services and building a community.

We built a subscription model into Penfolds’ digital infrastructure. Using Wine Plans, customers can subscribe to seasonal shipments of wine, including cellar door exclusives from their favorite wineries.

You can implement levels of loyalty benefits, too. Penfolds has nurtured a community around its Kalimna Club, offering members exclusive benefits that scales across its three-tiered system. This includes invitations to winemaker dinners, early access to new releases, and exclusive experiences.

Then there is The Black Grape Society, an invite only club founded by Treasury Wines where exclusive members gain access to premium wine at a discount, with the relationship managed by a team of specialists for first-class service.

6. Connecting physical and digital experiences 

Seamlessly integrating online and offline touchpoints provides D2Cs with the ability to deliver holistic, personalized experiences to their customers. This helps to enhance customer satisfaction while also adapting to evolving preferences.

Alcohol brands can position their distilleries, breweries and cellar doors to be a core part of their omnichannel strategy. We threaded Penfolds’ physical experiences into its digital architecture to create immersive brand experiences. Customers can discover, plan a visit, and book wine experiences at its cellar doors, corking clinics, and dining events.

In the US, the Treasury Wine Estate extends its Wine Plans concept to Wine Clubs, which along with regular, curated, and personalized wine shipments, members get access to discount or exclusive cellar door activities.

Omnichannel experiences can also be in collaboration with your partnership ecosystem. For example, Treasury Wine Estate works with the reservation and event management system Tock as well as the experiential marketing platform Anyroad. These partnerships have contributed to making D2C an important channel to promote and reserve upcoming winery, vineyard, and restaurant events.

Embracing a D2C model

Opening a D2C channel can have profound effects on alcohol brands. Penfolds stands as an example of how investing in digital commerce leads to delivering better customer experiences and ultimately accelerated growth.

To unlock the range of benefits, alcohol brands need to overcome stringent barriers and complex regulations. By leveraging a robust ecommerce platform, businesses can rise to meet the demand for personalized customer experiences that provide a seamless end-to-end journey.

Embracing a D2C model requires a specialist digital commerce partner that is fluent in utilizing the right technology to meet the unique demands of alcohol brands. If you’re looking to establish a direct connection with your customers and venture into D2C, then connect with Tryzens.