The Wine Industry Needs a Jeffrey Dean Morgan Character
We need more operational wine experts to call balls and strikes.
The wine industry is hungry for solutions to help us sell more wine. Many people are working hard to make businesses work with some of the worst headwinds we’ve ever faced. And so many people are thrashing to provide poor solutions or ridiculous or overly simplistic excuses about what is causing wine’s downturn. The actual answer is — it’s a complex combination of many things . . . and solving it will require a multitude of changes.
I recently had a challenging exchange with an MW I deeply respect. I was calling out a wine-tech company that got some new funding after a decade of languishing by waving around the new cat-fishing technique of adding the hottest tech trend into their pitch (in this case, it was “AI”). They have been building and promoting a recommendation engine, which is pure nonsense (an article on Transforming Wine is coming soon). Company notwithstanding, the problem is that because they had friends who worked on the project, this person did not like my tone about stating that this technology wouldn’t work for wine in the near term. As an expert, they KNOW that. I challenged them to ause it on their e-commerce site if it worked so well which abruptly ended the argument but exposed a terrible problem that vexes our industry. Because of the US wine industry’s hospitality-based kindness and interconnection, no one is willing to stand and objectively say that a particular solution is not a good choice for wine companies.
After that exchange, all I could think of was that we needed the rawness of the characters Jeffrey Dean Morgan plays in movies and TV shows. He’s often variations of the gritty straight shooter. Despite many of his characters having unsavory and frequently outright terrible character flaws as part of their origin story, he often metamorphoses into the antihero who minces no words in telling uncomfortable truths. He varies between crude, antagonistic, and contrarian, but cutting through the center of his banter is almost always the strong dose of reality the episode or movie needs to ensure the plot and protagonist find their way to success.
I’ve been working pro-bono with several wineries to help them with digital transformation. One of the things I’ve noticed that creates confusion and impedes our industry’s progress is that there is no safe place to find expert opinions or analysis of software or vendors for the wine industry. Because the industry is so tiny and interwoven, and our Northern CA culture drives most US wine businesses, everyone in the industry is reticent to speak out. A very small group of TRUE experts earn their living consulting, and they are reluctant to stand up and say, “That is a terrible solution.” They cannot because wineries have relationships with some vendors that barely serve them. Equally problematic is that expert practitioners working for large companies (Gallo, KJ, Constellation, etc) are encouraged not to take a controversial position that may reflect poorly on the organization.
Culturally, it’s hard for most of our industry’s thought leaders to deliver the hard introspection like Scott Galloway, who speaks about tech and universities and how they are failing students. READ THIS ARTICLE. But imagine more people like Scott sharing what is good and bad about our industry with a searing truth that illuminates and sanitizes. Fortunately, we have some brave souls, like our own wine thinker, who often speak uncomfortable truths to our industry. We need more of this from operators, not armchair quarterbacks who have never or barely sold or marketed a bottle of wine in their lives. Sadly we are overwhelmed with “thought leaders” whose whole identity is often about being the authorities about choosing which products they deem to be drinkable — and lamenting about inflated prices, the sins of marketing, the “Big Wine” boogeymen, navel gazing trying to define ‘fine wine,’ proclaiming the natural wine revolution, or a myriad of other positions that gives them a perverted endorphin rush for being wine gatekeepers. This is our echo chamber.
But it’s not just pointing the mirror inward at wineries but especially at the industry software and service providers. For example, too many great tech companies have unrealistic expectations that an ecosphere of developers will build apps to help put two pieces of software together via APIs to make it easier for wineries to do their jobs. Unfortunately, instead, there is a dearth of talent that can help. Also every system has idiosyncratic behaviors, wineries often must discover those challenges AFTER they bolt systems together. It is absurd that these not already well-documented by some of our best software companies. We as a software industry can, and should, do better.
I’ve observed firsthand how small wineries struggle with even the best-of-breed tech solution. I’ve watched them lose valuable time in data reconciliation, re-entry, and shipping or compliance adjustments. It often feels like a black hole of wasted time and energy. This is unacceptable. It is hurting our industry proclaiming our tech solutions make their jobs easier.
Similarly I have winery friends who’s tech setup reminiscent of the Winchester Mystery House — barely functional and tied together by ducktape and bubblegum, but any change in systems presents massive challenges because it’s not just the software that’s the issue; it’s the complex systems and outdated business practices deeply embedded in their operations.
But it is hard to find truth as an industry. Especially when there’s a group of talking head writers who have never sold or marketed a bottle of wine in their lives and are happy to regurgitate press releases or company propaganda as if it were fact. It confuses the industry more and creates FUD in the market. How do you pick the best vendor when a writer chirps how a tech company “helps wineries experience a growth of between 18% to a whopping 41%” without checking if it is true and understanding why.
This is important because, with honest roadmaps and calling balls and strikes for which tools to choose, the path to success is not only stymied by inadequate solutions but also the weight of managing their deficiencies, resulting in a higher total cost of ownership but also higher setup and switching costs. That’s why wineries stick with terrible solutions for years rather than switching. But it’s not as plug-and-play as we’d like you to believe. Even when it is necessary to switch platforms, you still have to go back and rebuild all the setups, integrations, and processes wineries created with their previous softwares.
Considering how important this issue is for our industry, I had hoped that some of our B2B publications would produce buying guides. Unfortunately, the limited number of wine industry vendors means these publications often refrain from taking a stance to avoid upsetting potential advertisers. I had hoped industry associations could fill this gap by employing experts to evaluate and recommend which tools and services are most beneficial for wineries. But most of them focus on supporting who becomes affiliate members versus which solutions are best for their members. Finally, tech companies themselves are often hesitant to take firm positions so that they can maintain neutrality within the tiny vendor community that services wineries.
So let’s deliver some balls and strikes —
Overhyped Technology —
Avoid Shiny Objects — I love generative AI, and it is genuinely one of the most important waves of transformative technologies since the iPhone, social media, e-commerce and search. Soon it will be woven into all your software tools as a invisible fuel to make every day tasks easier. However, the amount of AI-washing by companies trying to breathe new life into their products or inflate the value of what they are doing by saying they are using “Artificial Intelligence” is often just lipstick on a pig. ALL wine AI recommendation engines are junk science (especially the two claiming to be the industry leaders).
Software Pyramid Schemes — There are very, very few good use cases for blockchain and NFTs that are easy to implement and can scale. Most people pitching them have either drank their own Kool-Aid or micro-dosed their way into believing in a tech utopian use case that will never be. There are good use cases for loyalty programs or tracking provenance, but implementing them is not a simple exercise for both the brand and the consumer. So when Club dVin comes to tell you that NFT wine clubs are the future, you show them “Lucille.”
Software vendors —
Swimming with Lead Weight — We have a lot of vendors who are just garbage, and someone needs to say it. AMS may help your winery with accounting, but it is one of the world's WORST e-commerce and club tools. It acts less like sales enablement and more like a sale prevention system, and while it may make it easier for the finance team to reconcile the books, that’s not worth the way it limits customer acquisition and conversion.
The owner of e-Cellar once told me he was angry with me because I never promoted his solution. That’s because anyone with any integrity would never promote mediocre software to wineries when there are way better solutions in the industry for far less cost.
Predatory Software Pricing — You almost should NEVER be charged for software based on your production size or how much you earn in revenue. Software should charge you based on the volume of transactions they help you accomplish, the quantity of data they need to process, the number of users you have, or optimally, the features they give you. So when I encountered that both Enolytics and WinePulse charged based on your gross revenue. Even worse, I learned that some wineries pay more than $15K/year FOR BASIC ANALYTICS SOFTWARE, I was flabbergasted.
Fortunately, there is hope on the horizon. Stephen Mok from New Vintage Labs (who has a fantastic free newsletter, by the way) is about to release a souped-up winery analytics tool which will launch soon on Commerce7’s app store and then soon after on Shopify for between $49.95/month and $75/month!
I recommend you contact him ASAP if you are on C7 or Shopify and looking for a great analytics solution.
Texting is a Feature, not a Platform — Anyone using RedChirp plus an email system is doing it wrong. Not only are you paying a premium for SMS/MMS services that you can buy at a fraction of the price from SimplyText, but even more importantly, you can (and should) use Klaviyo because it is fully integrated. You can automate customer journeys versus the time and energy of cobbling solutions that don’t create a seamless customer experience.
If you are a Commerce7 Customer, the Digimatic app makes it easy to implement — https://digimatic.com/commerce7-to-klaviyo-integration/
E-commerce 101 — Shopify is a fantastic technology and e-commerce solution. It and Commerce7.com have become the industry leaders for price, functionality, and more. However, the Achilles heel for Shopify is that you need to combine a set of vendors with Shopify to make it work the same as C7 straight out of the box. C7’s recent acquisition of WineDirect’s stagnating e-commerce business has created ripples through the industry There is now the immediate opportunity to upgrade to better solution but equally a tidal wave of anxiety for producers. Change is always hard but made more so from the myriad of vendors crowing how easy it will be to move from WineDirect to their solution. Some of them are claiming it will be easy because they are “Shopify.” But they are not, they are just plug-ins and not all of them are created equal. Blowhards like WineHub, want wineries to think they can singlehandedly solve all of their DTC problem despite only being the club processing plugin and being far more expensive than other comparable tools like Awtomic — who are best in the breed for wine club processing and customer service and at a more than fair price — https://www.awtomic.com/pricing. Also what WineHub doesn’t mention that you are paying anywhere from 4% to 5%+ of your club revenue when you combine their costs plus Shopify’s processing fees not to mention compound subscription fees ranging from
Taxation without representation — Very few technology tools should charge a percentage of the transaction unless they are increasing revenue while continuously investing in R&D to make their tools better. In my humble opinion, the ones that help process and increase your revenue fall into that camp. Compliance tools that charge a percentage of sales should be immediately rejected. And candidly, ones that charge volumetric transactional fees that exceed those of email costs should also be rejected. How can Klaviyo can process hundreds of thousands of emails and texts at a fraction of the cost of what Sovos and DRINKS charge for compliance? It’s just data. The reason is because they know they have no competition and are predatory in their pricing. This is WRONG and needs to change. We need a better compliance solution
Service Providers —
The Good, the Bad and The Ugly of Service Providers — Any consultant who guides a winery in implementing Salesforce for its DTC tech stack should be immediately banished from our industry. Five major companies have collectively spent over $100M attempting to make it work, and all five have abandoned it.
If you meet an agency that says they specialize in . . . everything — RUN.
Finding good agencies in this business is hard because marketing and digital are no longer small jobs — those jobs require skills across a large and changing surface area. If you are looking for top-tier consultants for DTC, here are some companies I would hire —
- Egan Consulting — https://www.eganwine.com/ — specializing in branding and DTC
- Nonni Strategic Marketing — http://www.nonnimarketing.com/ — PR and International Brands
- First Pour — https://www.firstpour.co.uk/ — Without question, the best social media and influencer agency for wine.
I’ll have many more amazing vendors to add but I am running out of time to complete this article so I’ll add them in the comments as I remember. Favorite or bookmark this article to see additional comments with more companies that I would recommend in a heartbeat.
Reports —
Disinformation vs. Knowledge — Since Silicon Valley led the market by releasing vital information to help wineries succeed, this has become the de facto way to create thought leadership. Because we have such a dearth of information, nearly every report becomes relevant and is shared by the narrow group of B2B press outlets (barely five meaningful publications). And the amount of nonsense reports that are released floods the airwaves with poorly researched studies, reports that are only infomercials, or skewed information to match a narrative which echoes our post-truth reality. So when you hear someone quoting a WineGlass marketing report that only surveyed 1,600 US wine drinkers via social media, remind them that it is “a crime against data.”
If you are looking for good reports, always start here —
- Silicon Valley Bank Report — https://www.svb.com/trends-insights/reports/wine-report/
- Ciatti’s Monthly Report (now an online newsletter) — https://ciatticompany.substack.com/
- Terrain — https://www.terrainag.com/
- Rabobank — https://www.rabobank.com/knowledge/beverages
Press —
Abusing Power of the Pen— Too many wineries, vendors, and associations are scared to publically say what they all say in private. Yes, most critics no longer move the needle for sale but are a necessary evil to get past the retail gatekeepers. Yes, two of our most significant online wine publications are clickbait and have terrible ROAS (Return on Advertising Spend). Still, there are significantly few other options, and wineries I’ve inquired to would rather spend something with lackluster returns than get no returns at all. Yes, Jess Landers and the Chronicle’s editorial team have lost the narrative. They can’t decide if they are investigative journalists, the ones to champion the end of Napa, the inventors of the zero-zero trend, or Northern California’s natural wine guide. It’s a terrible waste of ink for one of the few publications that exposes our magical elixer to infrequent wine consumers.
We need better publications for wine and spirits but more importantly, we need publications that reach normal audiences to include wine and spirits content.
A Road Map—
Making wine is hard. Selling wine is harder. We live in turbulent times and there are a lot of voices championing a lot of choices. But what the industry really needs is actual experts taking a position how to build recipes for success. We need more honesty and transparency which platforms, technologies, and service providers wineries should choose and which they should avoid. We need more truth-tellers and more no-holds barred, objective evaluations of the industry players so wineries can avoid wasting money and time on companies that hurt them rather than help them. We need more Jeffrey Dean Morgans in the wine industry.
