(Wines&Vines) - With distributors and retailers consolidating at a record pace, smaller and newer wineries are becoming more and more dependent on selling wines directly to their customers. Even medium and large wineries are pursuing direct sales as more profitable alternative to selling through the three-tier system and accepting its hefty markups.
Unfortunately, direct-to-consumer (DtC) technology and practices are evolving rapidly, and many wineries still have not perfected their strategies and tactics.

To jumpstart these wineries’ efforts, Women for WineSense of Napa and Sonoma counties held a seminar Nov. 3 at Merryvale Vineyards in St. Helena. The instructor was Sandra Hess, founder of DTC Wine Workshops, who has extensive experience in both sales and high-tech commerce. She helps wineries implement and optimize DtC.

Her theme was “Do’s and Don’ts of DTC,” and Hess provided enough practical ideas that she assured listeners they would take home at least a few they could use immediately. She wasn’t exaggerating.

Why DtC matters
Hess began with a reminder of the importance of DtC: 4 million cases were sold direct in 2014, an increase of 15.5% over 2013. That represents $1.8 billion in revenue, a number expected to exceed $2 million this year.

“Wineries were skeptical that DtC would be important at first, but that’s changed,” Hess noted. She attributes this growth in importance largely to the aggressive campaign by Free the Grapes!, the Wine Institute and others to allow wineries in California to ship wine to 43 states—and counting.

Delivery services also have added refrigerated vans to protect the wines during shipment.

DtC sales are potentially much more profitable than the three-tier system, though they do incur costs such as improved tasting rooms and technologies as well as better training for staff. They also provide much better information about customers. “What you learn lets you make better decisions.”