One Blog |April 23, 2013 | POS Tracking Software

Increasing Wine Sales - Why the Point-of-Sale Marketing Mix Matters

Mark Fullerton

And It Matters Just as Much for all Beverage Alcohol Products

Is Your Brand or Product Being Seen?

You’ve probably heard the saying: “Perception is reality.”

And you probably know how difficult it is to change someone’s perception once they have made up their mind due to a "perceived" reality, vs. a “real” reality.

Well, there is another saying I’d like you to consider: “If I can’t see you, you don’t exist.”

Speaking of being seen, consider that wine – as well as all types of beverage alcohol – marketers, suppliers, distributors and retailers really do have their work cut out for them these days with the availability of the thousands of products competing for consumer’s attention.

Here’s an example: An eastern-US regional grocery chain, Giant Eagle, with stores in Maryland, Ohio, Pennsylvania and West Virginia, currently offers over 1,950 wines, 100 champagnes and other sparkling wines, 840 beers and 450 spirits. With every remodel of an existing store or construction of a new store, the real estate devoted to beverage alcohol products increases. So here's the key question!

Q:  What kind of marketing do these thousands of beverages get?

A:  Most of these beverages – with the exception of some of the beers from AB/InBev and MillerCoors – receive little to no "traditional marketing" support. Sure, there are some print and Internet ads, but with availability of over 105,000 wines, for example, suppliers and importers can only support a relatively few number of brands and products with traditional marketing.

The truth of the matter is there are fewer and fewer new beverage alcohol products that can afford any kind of traditional marketing support such as print and broadcast ads, product brochures, billboards, sales force incentive programs or sponsorships.

And it’s only going to get worse, especially for wine.

Here’s one reason why, according to Wines and Vines. (Note 1) The total number of North American wineries grew from 6,357 in 2009 to 7,498 in 2012 - Over 18% growth. When you include wineries from Canada and Mexico, that number grows to 8,046. The point is: The market for wine, spirits and beer is said to be “oversaturated”, meaning the majority of products coming to, and already on the market, will likely be unseen and therefore from a perception standpoint they simply don’t exist.

How To Be Seen? Establish (and then track) your 'POS Marketing Mix'

What can the growing number of national and international wine suppliers do to be seen?

First, it is probably a good idea to remember that the goal of marketing, according to Peter Drucker, “. . . is to make selling unnecessary.” (Note 2)  One way good marketing accomplishes Drucker’s goal is to make your brand or product stand out from the crowd. When applied to most wine and other beverage alcohol brands and products, some of the few affordable forms of marketing include point-of-sale (POS) displays, paper and permanent signs, banners, coupons, tasting events, dinners, demonstrations, wine lists, and food and wine menus.

We typically call these forms of marketing and promotion the "POS Marketing Mix." Naturally, it follows that the POS Marketing Mix must be managed to assure that you’re getting the best possible return-on-investment (ROI) on your marketing and promotional campaigns. This brings us to another point made by Drucker, “You can’t manage what you don’t measure.” We further enhance this concept by saying “You can’t measure what you don’t track.”

The good news is that POS marketing, unlike most traditional marketing (Note 3), can be measured to determine its effectiveness (correlation) and efficiency (ROI) in generating or increasing sales of a particular product.

From our perspective, the even better news is that OnTrak’s products provide beverage alcohol marketers the tools to track, measure and manage the POS Marketing Mix.

To learn more about our products click this button:

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Note 1: “North American Winery Total Passes 8,000,”  Wines & Vines,  February 2013;  read more at: http://www.winesandvines.com/template.cfm?section=news&content=111242

Note 2: Peter Drucker, The Grandfather of Modern Marketing, The Drucker Society, 2009 presentation by Philip Kotler; read more at: http://www.druckersociety.at/repository/201109/Grosser_Festsaal/1530-1615/10.0.1%20Kotler.pdf

Note 3: Traditional marketing – for example, print and broadcast ads – cost is typically presented as “CPM” which is the cost per thousand views. Two variables are used to calculate CPM, audience and cost. Measured POS, on the other hand, correlates marketing costs to sales to calculate ROI and to demonstrate the relationship between a specific POS marketing campaign created for a specific market (or customer) and brand (or product) and the % change (+/-) in sales performance (lift) during the time-span in which the POS was displayed. For more information go to: http://www.srds.com/frontMatter/sup_serv/calculator/cpm/

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