With wine consumption estimated at 31.8 million hl, the United States confirmed its position as the top global consumer since 2011, and has seen exponential growth in domestic demand compared to previous years (+2.5%/2015) – Source OIV, 2016
The country is the biggest importer of wine in value with over $6 billion imported in 2016 – Source OIV and remains the most attractive market for many alcohol brands and institutions, despite its complex distribution system.
To ensure full success, here are a few strategies for a wine company to consider prior to entering the U.S.:
Get to know the market
The United States is not one single market; it’s 50. Each state has its own set of laws and regulations for sale and consumption of alcohol. Some states don’t allow wine sales in grocery stores or chain stores, some states have the monopoly over the sale of alcohol in the state, some counties in certain states are dry and prevent the sale of alcohol.
And then there is the notorious three-tier distribution system where alcohol producers can only sell their products via wholesale distributors who then sell to retailers/restaurants who may sell to consumers. In short, be prepared to deal with several layers of people before you see your product on a shelf.
As the United States is a large country, keep in mind that consumption habits vary greatly depending on the regions, and a wine consumer in New York City will drink differently from one in Santa Fe, New Orleans or San Francisco.
Select the right partners for your business
If you’re not able to have someone working for you full time on the ground, it is critical to be able to rely on people who are experts at what they do and know the best business practices in your target markets. Finding partners who you can trust is key. Conducting business in the United States differs from France, Spain or Chile. Not only is it important to understand the federal and state laws and regulations, but knowing the codes and language to navigate through the intricacies of the markets are important.
In your quest to finding a wholesaler, you should look for a company that has a similar business philosophy as yours, one that is financially stable and who has a plan to invest in your brand. There should be room to stand out in their portfolio and the company should cover the geographical area you are looking for, whether it’s several adjoining states or only one county in one state.
While the dream of every producer is to be included on New York or San Francisco top restaurant lists, these markets are highly competitive. Focusing on secondary or less crowded markets e.g. Washington D.C area or New England is a good option to start.
Once your product is distributed, investing in public relations can complement your business strategy and ultimately help you increase sales. For example, at our agency we’re able to craft a PR strategy tailored to a country, region or a brand and implement it across the U.S. to generate positive publicity for your product.
Define what makes you unique
Almost every country that produces wine is represented in the U.S. While attributes such as “high quality, family-owned, craft, award-winning, sustainable, terroir-driven” may apply to your estate and products, chances are your competitors use the same terms to describe theirs. By defining what is unique about your products in 2-4 short points, you will be able to set yourself apart and help build your story. There will be two versions to tell: a practical one for buyers (i.e. why you think the product will sell and how it will make profit) and the consumer version (to focus on the product and/or the maker). What sells are stories and characters.
What is unique about you will need to be repeated and supported in your communications so that the trade (and eventually consumers) can remember and repeat it. Read our post on importance of storytelling here.
