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Jul 03, 2020

Wine Ecommerce: How To Successfully Sell Alcohol Online

The online alcohol market place is in a spirited away situation right now. Are you wondering why?

Because despite having the potential of exponential growth, it is still not off the ground yet. And yes even I am having a hard time believing it. We are living in the greatest era of online shopping portals and applications where we can order our favorite food, books, even furniture online. But have a hard time finding a decent bottle of Chardonnay.

So what gives? Why are famous wine and alcohol breweries still not taking advantage of this booming eCommerce scenario? What’s stopping them? And what will happen when they do enter the eCommerce sector with full force?

wine ecommerce

Well, I can’t see the future. But I can look at the present and tell you that right now is the perfect time to open an online marketplace for liquor. And if you are thinking about how to do it, then rest assured, because I’m going to talk about that too.

So let’s begin, shall we?

1. Why Wine, Should be online

Why is alcohol eCommerce still a unique idea?

Well, it is a valid question, after all, eCommerce is not exactly anything unique at this point. However, the key factor that is making it unique is the fact that the market is still untapped.

Besides a handful of websites and online grocery store channels, the market is mostly empty. Which is unusual, because people love buying things online as much as they love to enjoy a good glass of wine.

Let’s look at a few stats if you are still skeptical about the success of an alcohol delivery app.

  1. The total sales of alcoholic beverages in the US alone were noted to be about $243.6 billion in 2018.
  2. Alcohol sales through online grocery and marketplace grew by 115% and 60% in 2019
  3. The COVID-19 scenario, and stay at home measures have increased the demand for online eCommerce market for, well, everything, including alcohol.

Now, if these statistics are not convincing enough, let’s look at a few advantages.

a. Opening Up To A Larger Audience

Everyone is online, and you should be too.

wine ecommerce market

Really. People are more prone to shop and discover newer products online than they are in the real world. And with a marketplace distribution platform for liquor, your winery/distillery/brewery can become part of the online world, opening up the business to a broader audience and increasing chances of business success. ‘

Pro Tip: It is absolutely crucial to understand the needs and preferences of the target audience on an alcohol eCommerce platform. These needs and preferences can change depending on what generation the users belong to.

Needless to say that with a website, one can reach out to a larger audience through meaningful content, increasing the market value of the business.

b. Increasing Online Visibility

In today’s world, online visibility is everything. If something doesn’t exist online, it might not exist at all.

While it might be nice to be the exclusive winery that makes wines from super rare grapes, it won’t get you far. Exclusivity comes from quality and renown. For new businesses, it is crucial to earning that “renown” part. An online platform will be the key to enhancing online visibility as well as The perfect decision to build a good reputation in the market.

c. Data Collection And Analyzation For Better Business

Needless to say, data is everything today. No matter what market you are in, data will help you to excel, and the same goes for the online marketplace for liquor.

wine ecommerce

With an online eCommerce platform, business owners will be able to collect a substantial amount of data that will provide a unique perspective on the client demographic. This insight can help to enhance the workings of the eCommerce platform, and eventually increase sales.

2. Business Models For Wine Ecommerce

Choosing the right business model is going to be crucial for the success of the wine eCommerce platform. It will not only define the way you are going to conduct businesses but also how the website development and design process can go. Here are the two most common alcohol marketplace business models.

a. Business To Customer

B2C is the most common model for eCommerce marketplace management. With this model, the store (retail seller, chain store with online platform) will establish a direct relationship with the customer.

One of the main benefits of this model is the fact that manufacturers, i.e. the beverage making companies can leverage the advantage of the huge client base of the retailer stores.

Pro Tip: Many countries may not allow a brewery/winery to sell directly to their customers. In that case, they will have to go through a third party distributor to reach out to the customer. So conduct thorough research on the alcohol eCommerce Law and regulation before making any plans.

The downside, however, is the fact that the manufacturer won’t have any direct control over targeting a specific type of customer.

b. The Wine Club Model

The wine club model is a popular business model for the wine eCommerce platform. It focuses on providing an annual service to the customers based on their subscriptions.

Depending on the tier of subscription, the customers get a select number of wines delivered to them on an annual basis. The wine industry has been leveraging the advantage of this model for a decade and so far it is one of the most successful business models. So much that other industries such as fashion and beauty have started to leverage it as well.

The best thing about this model is that businesses have more control over predicting and stocking their stock, while the customer gets more personalized service from the businesses

3. Different Ways Of Delivering The Beverages

Wine eCommerce platform does not depend on only home delivery. There are two distinct models alcohol eCommerce industry uses, and these are-

a. Click It And Collect

With this model, the customer places the order through the alcohol delivery app and collects it from any local shop. It is perfect for small retailers who don’t have enough resources for home deliveries. This is also beneficial because with click to collect models, the platform does not have to spend a lot on home delivery expenses.

b. Delivering The Beverages Directly

Direct delivery or home delivery is a well-known delivery model for eCommerce distribution networks. The marketplace platform can deliver the beverages straight to the user’s home through their own delivery services, or hire the assistance of other delivery and courier services like FedEx or UPS.

Choosing a delivery model is tricky as it can impact the development of the platform. So make sure to talk to the web development agency you partner with before making any decision.

Now let’s talk about how you can actually build such a platform. For the sake of convenience, we will divide this part into two segments- design and development. So let’s begin.

4. Let’s Get Into The Development Process

Developing a wine eCommerce platform is a pretty unique idea, considering the market and how hard it can be to please the connoisseurs of fine wines. But, with good planning and a great work ethic, it can be done. Below we are going to talk about the development process of an alcohol delivery app/website based on our process. If you want to learn more then check out our work process page.

a. Planning What It Takes To Build A Beverage eCommerce Website

Planning is considered to be the most important because this is where it all begins. Every decision taken in this step will act as a foundation for the development of the entire platform and a shaky foundation never did any good.

Here is a brief rundown of the planning process, and how we can use to decipher the code to wine eCommerce success-

Determining the business goals and objectives:

The process starts with a discussion about the business and its goals. This discussion includes the country, city, or continent the platform for selling alcohol online will be operating within, the kind of products they will be selling, and what kind of revenue they are looking to make initially.

Understanding the competitive landscape:

This is the step where market and competitor investigation is conducted and that information is used to refine the later stages of the development process. Competitor research will provide information on how other online alcohol stores are operating, the design and development details of those platforms. And market research will give information on the audience, and their demands for such a platform.

Understanding the target audience:

The next step is to research the target audience. For a platform such as b2b wine delivery, this step is important. It will help in understanding the users and what they really need from a wine eCommerce platform.

The insight gathered during the planning process is going to be invaluable during the next stage, which is the design stage.

b. Creating An “Intoxicating” Design

Design for us is a user-focused process, and that’s why our design process starts with user persona creations and empathy mapping.

It is important to focus on and understand the user when designing an alcohol delivery website. The user base for such a platform is diverse and vast, including users from all walks of life, and not creating a user persona before beginning the design, is not going to be an efficient way of beginning.

When designing for alcohol delivery services, we aim to follow the market standards in the industry, set by competitors and web design agency based on major cities like New York. But that does not mean there are no unique twists. Mixing up a little twist in the basic rules can be a good practice when it comes to web design. For now, let’s check out the market standards for web design in the eCommerce segment-

Keep It Light And Breezy

If you follow most of the competitors in the b2b alcohol marketplace, you will notice that they are keeping up with the light and breezy design trends. Why?

Light and breezy

Because it keeps the users focused on the products. With extra graphics, animations, and effects, you will only distract them. So it is better to keep the design light and their focus heavy on the product.

Lean Towards Legible Typography

Let’s face it, some of those wines have names that are really hard to pronounce. And displaying those tough to pronounce names in cursive lettering will not help online alcohol sales.

typography

Using too complicated typography will make web approachability a major issue. So it will be

wise for you to use legible font and typography on the site so that users can engage better.

Efficiency In Design Is Key To Success

I’m sure users would love some transition effects as well as some micro-interactions. But adding too much can be a little harmful especially for the b2b website for wine.

When browsing an eCommerce site, regardless of the market, customers look for efficiency in the experience. The ease and speed of the whole process matter more than extra embellishments of the design. Not to mention all those extra bells and whistles are going to blow a hole in the budget as well. So the best idea is to keep it simple, efficient, with just the right amount of spice.

marketplace selection

Once the UI design and clickable prototype are approved by the client it is time to move onto the development process. This is the process where the design is turned into a functional product ready to take over the market.

c. Brewing The Perfect Platform

Once the strategy Agile Scrum Methodology for the development is ready, we try to choose the best possible tech stack that benefits the platform as well as help with the development to be done in as little time as possible.

The main aim of the development process is to deliver a viable product that not only sells but also brings some real benefits to the business. With an expert team and an array of latest tech at our disposal, we make sure that the alcohol marketplace platform is developed to function at its fullest. Here is a list of tech stack we use to make the platform function properly.

Back-end Laravel, Ruby, Python, Node.JS, Java
Front-end Angular.JS, Vue.JS, CSS
Database MongoDB, MySQL, PostgreSQL, Firebase
OpenSource Drupal, Magento, WordPress
iOS Objective-C, Swift, Xcode
Android Java, Android Studio

d. Testing The Waters Before Going Live

Last but not least, testing is as important a step as any other in the whole development process for us. No product is launched without testing it and making sure that it is free of all issues and bugs.

Various tests are performed to ensure the quality of the product. Here are the top three tests performed we perform on the developed product in order to ensure its quality and security-

Catching The Bugs With Unit Testing

Through unit testing, we test each singular part of the product, a.k.a units separately to ensure that they are functioning properly. During this, the developers are also going to look for bugs, and work to remove them during the development process.

Looking Under The Stones With Manual Testing

Manual testing is done by testers to check out the problems that can be skipped over sometimes. This is a test done by humans for human users and it is the best possible way to make sure that the wine eCommerce is working perfectly and the UX offers value to the users on the platform.

Guarding Against Adversaries With Security Testings

The aim of security testing is to locate the vulnerabilities within the codes and fix them before the product goes live. It’s crucial that for an eCommerce website security testing is done properly, as it will be handling a lot of sensitive online alcohol sales data as well as users’ payment data.

It is important to check out the challenges an alcohol eCommerce platform can face before making big plans. So let’s check out the major challenges in both the US market and the UK market for a better idea of what is to come.

5. Challenges and Legal Advice: How Hard Can They Be?

For wine eCommerce, regulatory and legal challenges are many. Let’s check out the major challenges in two of the biggest markets for online alcohol selling, the US and the UK market

The US Market Challenges

The legal challenges for the US market are many. From the three-tier model that limits the breweries from selling online to temperature control, there are many legal and technical challenges to overcome if you want to sell wine online in the US market. Let’s check out the top challenges for the US market.

a. The Three-Tier Business Model

The popular three-tier distribution system was launched in America during the 21st amendment of the US constitution. According to this, wine manufacturers can not directly sell to retailers or customers. They have to go through an alcoholic beverage wholesaler to reach out to the customer. This also means that alcohol brands, wineries, and breweries can not sell alcoholic beverages online.

There have been some international and national alcohol businesses that voiced their concerns about this system and how this makes it harder for international brands to enter the US market. However, the law was placed in order to prevent alcohol abuse. So make sure before creating such a platform you become familiar with the finer points of this law.

b. Shipping Restrictions And Regulations

There are hundreds of shipping regulations and laws one needs to know before opening a wine eCommerce Marketplace.  In the US, individual states have control over the production, distribution, import/export, and sale of alcoholic beverages. Every state has a different set of laws, which means that to run an alcohol eCommerce platform in the US, one has to navigate all these regulatory laws. There are also some state laws that prevent the sale and importation of certain kinds and quantity of alcohol the users can order.

c. Age Restriction For Alcohol Consumption

There are age restrictions on the consumption of alcohol around the world. For the US that age is 21 years. And this age restriction applies to selling alcoholic beverages online as well. And that’s why you need to take steps to ensure that the selling process is not violating this law in any way.

For any kind of alcohol delivery process, an adult needs to be present to sign the documents. For those who are choosing for a click to collect model, where the users are ordering online and picking them up from a local store, they have to procure an ID before paying and collecting. The age gating process can be a little complicated to integrate when creating a wine e-store, but with the help of AI-based ID verification systems, this can be solved well.

d. Temperature Control During Delivery

During the home delivery of alcoholic beverages, it is necessary to keep track of the temperature of the drinks being delivered. This is a necessary part of keeping up with the freshness factor of the beverages. And that’s why it is important for the alcohol marketplace platforms to maintain a framework for temperature control. So many eCommerce platforms postpone the delivery in case the temperature is not between 45°F and 80°F.

For the UK Market

The legal regulations for the UK market are somewhat more relaxed than the US market. However, there are two important things to overcome if you want to sell alcohol online in the UK.

a. Acquiring The Proper Licenses

For selling alcohol online you will need two licenses: personal license and premise license.

A personal license gives the person permission to manage and sell alcohol to the customers. A premise license legalizes the place or distribution house from where alcohol is distributed. And in order to sell alcohol online, one would need both types of licenses.

For personal licenses, the business owner will have to take a short training course. Once you have a personal license, you can apply for a premise license.

b. Ensuring The Safety Of Under-Age Citizens

Probably the most important legal issue one has to pay attention to when applying for a premise license is the “protection of minors from alcohol abuse” issue. The legal age for drinking in the UK is 18. And anyone under that age needs to be protected from under-age drinking issues.

The risk assessment and plans to protect the underage from alcohol abuse are going to be crucial. If the authorities are not convinced, they will not grant you a license for alcohol marketplace distribution services.

Wrapping Up: Are You Taking Your Wine Business Online Then?

So what’s the end word on the alcohol marketplace platform development?

The truth is, it is an incredibly beneficial market. The online marketplace for liquor is growing and it is expected to grow more in the coming year. Add that to the popularity of online shopping among the modern consumer base, and you have a sure shot at success.

However, the legal hurdles are many, and it is not often easy to weave through them without having to lose one or two business aspects. But with reliable web development and design partner and legal help, you can figure out quite easily how to sell alcohol online, and thrive in the market.

Pratip Biswas

Pratip Biswas

Founder, Unified Infotech

I am an Entrepreneur and a Tech Geek with more than 1500 successful projects launched. I share my experience through my love for writing and help other entrepreneurs reach their business goals.

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