As the wine industry advances into a data-driven decision making paradigm, at Quini we get asked sometimes about the return on investment (ROI) a winery can expect from consumer sensory data.
Technically, this is about whether consumer research of the wine as a consumable, rather than just the outer packaging, delivers enough of an ROI to warrant the effort and investment.
Can a winery draw good ROI on consumer research of its actual product? If you are a seasoned marketing executive, you would agree the answer is an absolute yes.
The ROI question or answer is not a one size fits all. There may be some similarities in some cases, but the returns will generally vary between any two companies and situations due to the many variables involved.
So without delay, start to concentrate on your own business case. This will get you farther faster than worrying about what other wineries have done.
The impact of data on a business depends entirely on the questions at hand. Your business questions. The answer is not in the data itself but within the impact it can make.
Contemplating or asking the ROI question to justify doing nothing, before doing the homework yourself, will freeze you in your place.
When considering sensory data, here are but a few case examples to contemplate.
Notice that many of the cases are not related to new wine product innovations. Most are business situations that cost wineries money:
– What is the ROI if I knew, in advance, that my new product is a high risk that will likely flop?
– What is the ROI on finding out why sales of a SKU or brand have been dropping for 6 or 8 quarters, if I could figure this out a year or more sooner?
– What is the ROI on finding out if two of my brand line extensions are cannibalizing each other, before I dump, re-blend, re-label and re-launch a product?
– What is the ROI on finding out how my product stacks up against my key competitors in terms of consumer preference? Can I use this information in my product sales sheets to gain an advantage? Or will I learn something actionable if the competition is clearly thought of as being superior, by my target consumers?
– What is the ROI of learning that consumer product expectations of my product by examining the label and branding, is inferior to competing products but that the liquid itself is well liked? How can I use this information to save on resources and prioritize efforts?
– What is the ROI of learning that consumers are 40 percent more likely to recommend my wine than key competiting products? Can I use this information to sell more wine?
– What is the ROI on confirming that my pricing strategy is off? That I must either consider reducing my price to sell more, or the other way around, that consumers feel my product is underpriced and I have good room to increase profits?
– What is the ROI of finding out that consumer expectations from my wine is healthy but the product does not meet that expectation?
– What is the ROI on a more accurate wine blend decision, including sweetness, based on my target consumers’ advance feedback?
– What is the ROI on discovering a completely new product opportunity targeted at a particular demographic group that none of my competitors have yet awakened to? One that I even had not thougt about? Can I own the category and have everyone else play catch up for years?
– What is the ROI on finding out why millennials are all over a certain ‘ankle biter’ that has quickly gained popularity?
– What is the ROI on finding out, right now, what types of wine the largest segment of the US population, the Gen Z, likes and does not like?
– What is the ROI on getting consumer confirmation that the profile of my next vintage is aligned with last year’s successful vintage?
– What is the ROI on verified third party validation that consumers (the real buyers of my products), not critics, prefer the wines of one winery over another’s, in my due diligence when acquiring new wineries? How about what products to ditch or retain within the portfolios?
– What is the ROI on reinforcing or better informing vineyard management decisions going into the new growing season or harvest? Like yield, brix at pick, or pick timing?
– What is the ROI on pre-testing products that target a growing ethnic group of our population, so I can adequately service this important customer base adequately from the get go and win their long term brand loyalty and word of mouth?
– What is the ROI on allocating shipping inventory and warehousing more accurately to my various geographic markets?
– What is the ROI on quickly giving my winemakers answers related to the new wines they are envisioning and working on?
– What is the ROI on knowing if the colour of Rose wine impacts consumer preference, and exactly what consumers prefer it look like? Would this information stregthen my new product recommendation to my company before major investments are made? What is the ROI on my career too?
– What is the ROI on getting it right with key, costly decisions usually made prior to harvest, like packaging, or barrel purchasing whether it ought to be new French, American or Onky Neutral?
– What is the ROI on ……………..
Please take it from here. Depending on what your strategic business priorities are, you’ll realize very quickly that no bold and significant move in a winery should ever be made without putting the consumer at the front of the decision making occasion. Now such data is accessible and immediately consumable by wineries of virtually any size, and in real-time.
It’s your time to start capitalizing on new knowledge that used to be accessible to a few wine producers with many tens of thousands or even hundreds of thousands of dollars allocated to sensory consumer research.
When it comes to sensory data ROI questions that may be on your mind, we can certainly help.
Realistically though, you will find that there is no better person to answer the question than you. You know the issues and the opportunities better than anyone else. Including how they’d affect your business if you knew better, or if you didn’t.
Let’s talk sensory data.