Editor’s note: This is one of several features from our 2018 Technology Guide, which includes our annual Retail Technology Buyer’s Guide. Download the full guide here.
Technology solutions are increasingly critical in the brave new world of twenty-first century off-premise retailing.
“A lot of big national players are expanding into what was once the domain of smaller independent retailers,” says Brad Rosen, CEO of Drync. “For the first time, these smaller retailers need to become more completive and more efficient to survive.”
Historically, alcohol retailing was exclusively onsite and in-person, but that’s changing. “Consumers expect to be able to shop omnichannel, to buy liquor from phones and laptops, because they’re doing that in every other aspect of their life,” reports Bryan Goodwin, senior vice president of Drizly.
Technology partnerships are crucial to meeting today’s customer demands and competitive challenges, but it’s a crowded and complicated arena. How can a busy retailer sift through all the options and choose a solution that saves time and headaches instead of compounding them? We spoke to insiders on both sides of these partnerships for their insights.
Technology Partners Abound
BevDeals, launched in June 2018, is an online marketing and sales platform which streamlines the relationship between suppliers, distributors, retailers and restaurants. Founder Bjoern Lanwer explains that all three tiers benefit from a single central platform. Shops and restaurants access deals from multiple distributors, they can place all their orders simultaneously 24-7 and they can chat online with reps.
“The platform puts the power of time back in their pockets,” Lanwer says. “They always see the best deals, so they can make an educated decision, instead of under pressure when the reps come in. They can plan much better.” Centralized data also improves cash analysis.
Breinify is an engine solution that analyzes consumer data via AI (artificial intelligence) and machine learning. “We predict what their customers will be interested in, and we act on it by sending individualized email, SMS or push notifications on an app,” says CEO Diane Keng. Messages are further leveraged by integrating weather, local sports, holidays and events such as World Whiskey Day.
“We help automate it so there’s no work from the marketers’ side to get these really personalized engagements sent out to customers to increase the frequency they come in,” she says. “You’re not spamming your users with excess emails, you’re sending them something relevant they’re happy to get.”
LibDib was launched in 2017 to give small craft beverage makers a more level playing field. “We’re providing access to a marketplace where typically the wholesaler is gatekeeper,” says Cheryl Durzy, CEO and founder. Wholesalers often reject small makers due to low volume, but “my belief is consumers are evolving. They seek authenticity and smaller, local, family-owned producers.” The rich platform has content contributed by the maker, and enables consumers to contact makers directly. Retailers register for free accounts and can still use other distributors.
3X3 Insights is another 2017 launch. “We’re trying to help the beverage alcohol retailer not go the way of the bookstore,” offers CEO Mike Provance. “Smaller retailers struggle with data, so we’re collecting that data at a basket level of transaction, empowering the small stores to have the same category management as the megastores and online businesses.”
After 16 years in the credit card processing business, Merchant Preferred saw a need and filled it in 2017. Merchant Preferred Zero makes it seamless for stores to effectively offer a cash discount, thereby “immediately avoiding anywhere from $25K to $100K in annual fees for a small- to medium-sized store,” says co-owner Todd Odasz. For a flat monthly fee, the company provides signage and reporting, and maintain PCI compliance.
Legacy tech players in the alcohol beverage industry are also going strong. Drync, launched in 2008 as a wine app, pivoted to B2B in 2015, providing a mobile commerce platform for liquor stores. “We make white label apps for medium to large beverage retailers,” says CEO Rosen. Branded apps not only enable clients to fulfill the omnichannel promise, but also enables Drync to “collect data, and wrap it up in actionable insights so you can buy better, you can differentiate and your customers will get a personalized buying experience.”
WineFetch still builds websites for wine merchants, with the added value of integrating “your email list, your POS system and your inventory,” says Matt Rosen, VP of sales. “For example, our newsletter engine ties into your inventory.” The targeted marketing tools enable easy customer segmentation. “If you send ten emails a month and nine of them don’t apply, the customer will tune you out – or worse yet, unsubscribe. If you’re sending something of value, people don’t mind hearing from you. Your open rates will be 40 percent or more.”
Drizly is “the world’s largest alcohol marketplace,” Goodwin says. For stores, “we are their seamless turnkey ecommerce solution. We’ve brought retailers from initial conversation to live on our platform in as little as one day. They get higher basket sizes and access to more customers and to our tools such as data insights and online inventory,” he adds.
From the Retailer’s Perspective
With such a wealth of digital solutions to choose from, how can you make the right choice when investing in a tech partnership? We asked retailers from around the country to weigh in.
Tamara Pattison, chief marketing and information officer at Bev Mo, advises to “start your journey with the problem you’re trying to solve, then look at how other retailers or people in adjacent industries are approaching that problem, what technical or other tools are they using, to narrow down the potential group of vendors or technologies to investigate. We come at it from a solution-oriented approach. Ask what customer or associate problem you’re trying to solve.” Bev Mo is focusing on AI and machine learning for both customer-facing and back office applications.
“We’re continuing to look at what we learn in one application and ask how those learnings can be applied in other aspects of our business,” she says. In digital communications, “we’re focusing on personalization. It’s been enormously beneficial. Telling them a story that is rooted in their personal purchase history with us has generated greater engagement, larger basket sizes and opportunities for customers to trade up, putting them in a more premium tier.”
“Everyone does it differently. For us it’s research and referrals,” maintains Purav Patel, owner of Village Liquor in Houston, Texas. “We look for a lot of customer feedback from people who’ve gone through the selection process. Sometimes owners are reluctant to reach out to competitors, but most people are helpful when they’re not a direct competitor. You’ll get better feedback from peers than vendors. We’re always happy to talk to other businesses wondering about the best solution. Really focus on what’s going to drive value, on making life better in the store, on what makes you happier and more profitable at the end of the day.”
Andrew Byer, manager of Tri-State Liquors in Claymont, Delaware agrees. “Go out and talk to other retailers.” He affirms that “ecommerce is way to go. People like to be on their phones, they got used to ordering with one click. “Tri-State has touchscreens on the shelves with recipes, in-store specials and event announcements, and finds great value in list segmentation and Google Analytics.
“The important thing is to find something that frees up time to sell, and gives you reliable info,” suggests owner Matt Mell at Church Street Wine Shoppe in Huntsville, Alabama. “You need a quick turnaround; one place for information and availability, not six different places. It’s got to be extremely accurate, in real time. There’s no point if the information is three days old and doesn’t reflect availability.”
Brian Jobin, general manager at Tin Woodman’s Flask in Chittenango, New York, emphasizes that retailers need to look at what fits their environment, their shop, their demographic. “Tech is not embraced by everyone,” he says. Tin Woodman’s has interactive kiosks.
“Guests simply scan the bottle and get info, pricing, tasting notes and a little bit of history,” he says. “It’s a valuable addition to guest experience, especially if they don’t have the wine/spirits knowledge.” He utilizes the Wine Ring application, enabling patrons to create a database of wines they’ve tasted. Based on their likes and dislikes, WineRing suggests options.
On the whole, he believes “those tools have been very helpful in creating a more educated guest, who feels more comfortable with their purchases and understands more about the products.” Overall, retailers value streamlined technology which simplifies their workday. They recognize that competing in the virtual marketplace is essential, and that segmented, personalized, marketing efforts are key to growing customer loyalty.
Annelise Kelly is a freelance writer based in Portland, Oregon. Her passions in writing and life are food, beverages, travel and sustainability. Custom publications, trade magazines and content marketing are her specialties. See more of her writing at annelisekelly.com.