Selection and Differentiation in Grocery Wine w/ Curtis Mann MW, Albertson’s

Grocery stores are one of the biggest sales channels for wine. Curtis Mann, Group Vice President of Alcohol of the Albertson’s Companies, gives us the inside scoop on buying trends, how to sell into Albertson’s, and the rise of the use of digital. Learn about the dynamics of the grocery wine market and what makes Albertson’s “locally great, nationally strong.”Don’t forget - you can support the show on Patreon to help us keep bringing you great wine business content! Detailed Show Notes: Curtis’ backgroundMBA at UC Davis in Wine Marketing and AccountingMarketing at Trinchero Family EstatesWorked in wine retail at a small placeMoved to IRI in category management in wine and spirits insightsWas Raley’s wine buyer for 8 yearsGrocery as part of the wine marketMulti-outlet wine market ~$12-13B / yearTotal wine market ~$60-70B / year (multi-outlet ~20% of the total market)Albertson’s Companies’ wine overview~25 different grocery brands, ~2,000 storesWine is a key element of business - it drives sales and customer loyalty; some customers come to stores because of the wine selectionSome stores have up to 3,000 wine SKUsStores with more premium selections are correlated with location (high socio-economic demographics) vs. by grocery store brandFocus is more on the “premium” price segment ($9+ based on IRI)Top brands - Barefoot, Kendall Jackson, up-and-coming brands - Butter, Josh, but wine is very diversified. Big brands are still a small part of the marketPremiumization helping imports, including New Zealand Sauvignon BlancWine buying trendsConsumers are called to authenticity - they want to know what’s in their wine, the appellation, sustainability, and organicConvenience - cans, seltzer, ready to drink Premiumization - $10-20/bottle, $30-50/bottle, up to $100/bottle (e.g., high-end Bordeaux, Napa Cabernet) ranges all doing well, some categories accelerating with potential out-of-stocksCovid trends - return to cooking, consumers go to Albertson’s as a one-stop-shopWith restaurants reopening, a little bit of regression in sales, but still robust as cooking at home has been stickyCustomer demographics (for wine)Gen X / Baby Boomers - still buying a lot (more in bulk and volume), but less than beforeMillennials are the new customers - buying more, less loyal to wine vs. other drinks, and have less expendable income; their preferences are different from Gen X and Baby BoomersTo meet the changing demographics, Curtis looks forward 3-5 years to develop his shelf set/selections of wineConsiderable diversity of reasons people buy wine - occasion based purchasing (e.g., going to a party)Many people exploring and learning about wine (proof point - the massive increase in people taking WSET classes, including lots of consumers, not just professionals)Promotions / discountingLimited brand loyalty in wine, customers often default to priceGiven that, promotions are pretty importantWe need to work between price and product to optimize sales and not over-rely on priceWine selectionWhat does it mean to customers? Each wine must have a purpose vs. the other ~1,500 SKUs on the shelfThis could be style, story, or location/appellationWant to remove redundancy on the shelfTagline - ‘locally great, nationally strong’; try to give local stores more voice (e.g., Portland stores have more Willamette Valley Pinot Noirs)Flagship Stores (e.g., Andronico’s, Pavilions) - higher-end, eclectic offeringsSteps to sell into Alberston’s - have the 4 P’s put together - distribution network, pricing, product, and where you fit on the shelfGenerally need to place wine 4-6 months in advanceIt requires a UPC code on the bottlePrivate Label / “Own Brand” winesThe goal is to provide the best price to value for customersThe intent is to drive loyaltyNot a dominant part of the businessTrying to create wines that are a draw and get good scoresSelection is built around education, desire to learn about wine category through own brandsSuppliers have connections to maintain supply, which can help Own Brands overcome supply challenges (e.g., 2020 Napa, 2021 New Zealand)Digital AdoptionVirtual tastings - have done well, 1,000s of people sign up, people buy the wines beforehand or buy wines later and watch the tasting on YouTubeAppeals to groups of customers who don’t get to visit wine countryWill continue post-CovidDo education tastings 1x/monthKeys to engagement - consumers have lots of questionsThe team engages with customers via chatKeep it educational - need a balance of explaining concepts but keep it understandableConsumers using their phones more for education want to reduce the complexity of wineWine e-commerce - working on expanding this, challenging due to state regulationsExpanding drive up and go (“DOAG”)Delivery (e.g. - Instacart) growingStill a small portion of salesCore elements of success for the grocery channelThe selection keeps people in the storeRelating the wine to the food in the store (food - wine pairing)E-commerceConvenience (e.g., ready to drinks) Get access to library episodes Hosted on Acast. 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