Transcription

Ramin: [00:00:00] Hello everybody and welcome back. Welcome back to episode number 30. This is the second podcast of today. We don't usually do it this way, but it's awesome. We're, you know, keeping the topics aligned. Talking wine again. All right, we're back into the world of dtc and helping wineries grow their business.

And we are excited about today's topic. Sadly, as I said last time around, it's still too early to have a glass of wine, but I'm sure this podcast will. Be just as good without it. So we are live on LinkedIn, Facebook, YouTube, and Twitter. We're also making all of our replays available at the end.

They'll be right up on all of those platforms as, as well as on our website, sku agency.com and where you can check 'em out. And then we'll also be putting out clips, different clips. You know, our, our guests definitely say some very interesting things and we wanna make sure. That those sound bites are out there.

So thank you very much for tuning in today for the second time. I'm your host. For anybody who doesn't know [00:01:00] me, my name is Ramin. I'm one of the managing partners here at SKU Agency and also the host of the show. So we are ready to get this thing started.

That music, it just gets me kind of fired up. Alright, so today again, we're talking wine. Second time in, in the day we're talking wine. This time we're gonna focus on the future of direct consumer sales and who better to speak on this topic than Z campus. Zack is the VP of business development at Commerce seven, the fastest growing commerce platform designed to give wine.

Edge when it comes to direct consumer sales. So without any further ado, please welcome Zach to the Commerce Revolution podcast. Thank you very much. Being here today.

Zach Kamphuis: Awesome. Thank you Ramin, and thanks for having me here today.

Ramin: Absolutely. You know, I, I gotta say I was I've been wanting Zach on this show, I think since November, maybe November.

And I reached out many times. Zach has got a lot on his plate. He does many things over at commerce seven, but I am grateful and I think it was at. [00:02:00] Wine Symposium in January where I just said, please, I think I might have even begged, I might have come to the begging barn, said, please come on our show.

We really wanna talk about this topic. Cuz I think it's very important to see where things are going in the winery world. And you know, you have a wealth of knowledge and you guys have a lot of wineries on board, so you can see a lot of this data and mm-hmm also be able to look, you know, into the future a little bit.

So, Before we get to, you know, started on the top main topic at hand, just tell us a little bit about your business journey and, you know, ultimately what led you and how, you know, what led you to Commerce Seven. Tell us a little backstory in Commerce Seven, for anybody who doesn't know about Commerce Seven.

Zach Kamphuis: Yeah, definitely. So, commerce Seven, were a winery direct to consumer sales platform, right? So our winery clients, they use our platform to sell through all their major direct-to-consumer sales. So we have a, a pos they use to sell in the tasting room. We have e-commerce tools they use to sell on their websites.

We have wine club and subscription management tools. Reservation system of [00:03:00] crm. So that's kinda what, what Commerce seven is in a nutshell in terms of how this all got started. So my dad, Andrew Camp, this is actually his, his third time building a, a platform like this, right? So he was the lead developer over at at e Winery, now Vince Suite.

Mm-hmm. He built the VIN 65 platform which is now Wine Direct. And so this is kind of the third go. Him and Jason Andres who's our our DevOps manager kind of founded the company about five years ago. You know, I, I got the opportunity to come on as a third employee, which I was really excited about.

I love that. And yeah, it's been a really fun ride ever since.

The American Winery Has An Old People Problem

Ramin: Yeah, you guys are growing really fast. I mean, I think you and I spoke for the first time, if I'm going back, it was pre pandemic, maybe 2018, 19. And what, you know, what you were then to what you are now is just amazing. And, you know, I, I, I.

I appreciate, you know, the attention to the software. The software is great. I mean, and we, we get to see, you know, as a email and SMS marketing agency, we get to see a lot of [00:04:00] different softwares out there. And you guys do a really good job. And, you know, I, I, I mean, hats off to the, to the whole team and I love the new, the releases, the way you guys are doing it.

Video coming on, talking about you. Maybe a little Apple esque, if you will. You know, and how you doing it? It's a very good, you're good, you're good on camera. You're very good on camera with these releases. Yeah, it's, it's awesome. So if anybody's not on Commerce seven, definitely go check it out. I'm sure you've heard of Commerce seven.

But go check it out and reach out to them. So before we dive in again to this, this great topic of what the future looks like with direct consumer and for wineries, Let's talk about there was an article that came out in New York Times and some of it was based off of a report the 2023 Wine Industry Trends Report put out by Silicon Valley Bank.

But the gist of the article you know, and the title was catchy, if you will, the wine, the American wine industry has an. Old people problem and definitely gets your attention, like, what's this all about? So you dive in there a little bit and you know, the gist of it is that, you know, winemakers [00:05:00] and advertisers are missing out on this younger consumer that's out there.

And, you know, failing to produce wines that fit their budgets, but really when it came down to it, they really honed in on the fact that it was a lot of, it was the marketing side of it. What, what's your take on this article? I'm sure you've had a chance to read it to maybe, or, or, Gloss over it or heard of it.

What's your take on on their, is there a problem? Do we, is there an old people problem out there, so to speak? Yeah,

Zach Kamphuis: no, it's definitely an interesting article and, and it seems like a lot of the articles based off the Silicon Valley Bank annual report, which is a, is an awesome report. Mm-hmm. You know, really enjoy taking a, a look at.

You know, I haven't drilled into too much of the details, but it, it, it, it seems like a lot of the data is kind of around the, the DTC side of things. Mm-hmm. I'm not sure how much age data they have on, you know, wholesale and, on-premise and off-premise and, and things like that. So that would be kind of interesting to, to understand a bit more, but, You know, it does seem like wineries kind of have a bit of an issue potentially [00:06:00] connecting with a younger audience, right?

Mm-hmm. Mm-hmm. You know, kind of nurturing that relationship. They're obviously doing a great job in the tasting room with Yeah. With a lot of different demographics. But it seems like most of the club members today are, are an older demographic and, and it seems like either the value of the club isn't presented to the younger consumer in a way.

Kind of resonates with them, or, or they're just really not understanding the value there. But it, it, it's kind of an interesting idea for sure. Yeah.

Wine Subscriptions

Ramin: It, it's funny, you know, club, you know, you know, thinking, at, thinking, thinking of it like a subscription, right? Mm-hmm. You know, and so many, you know, young, young people out there are, you know, attuned to subscriptions, right?

You go and, yeah. I mean, our whole SAS life is based on a subscription, right? Every show that, you know, we wanna watch, you know, Netflix and everything is that. And, you know, we get our dog food and our pet food through subscription. So it's interesting, you know, it, it's maybe changing the conversation a little bit or changing the approach on that side of it, because really at the end of the day, it's, you know, getting somebody to agree [00:07:00] to a subscription.

That they're gonna get, you know, wine at a certain time of the year, and especially if they love your product, it's great. So I, I found that very interesting that maybe wineries, you know, have this opportunity in front of them to, to speak to the younger audiences out there in a different way and maybe get their attention.

So who knows? Who knows where it goes. Yeah.

Zach Kamphuis: No, I, I think that yeah, there's definitely a, a different way to kind of present the club to a younger consumer. Mm-hmm. So they kinda understand it a bit better and it resonates with them a bit better. You know, as you mentioned, there's a, there's a ton of subscriptions out there today and, and, you know, younger demographics are, are definitely they definitely belong to a lot of subscriptions today.

Mm-hmm. But the subscriptions they belong to are, are structured very differently than a traditional wine club, right? Mm-hmm. You know, as you mentioned, it's this, it's kind of a commitment when you sign up for a subscription or a club, there's some concerns with that commitment. You're concerned. Am I gonna like this?

Can I back out if I don't mm-hmm. You know, what are, what am I really committing to? And you see a lot of [00:08:00] other subscription services out there, do a really good job of kind of managing and handling these concerns. Mm-hmm. Right. If you go to Dollar Shape Club, or Blue Apron, or Netflix or any of these, these platforms they'll make it really obvious right on the homepage when you're signing up that, hey, you can cancel anytime.

Mm-hmm. It's curated, it's flexible. You can skip and put it on hold and you know, they ease the. But they also really articulate the value of the flexibility in the convenience, right. Which maybe the wine club could do a better job of. Now, traditional wine club we see today most wine clubs on Commerce seven, their, they're user choice.

Mm-hmm. So the member has some flexibility in terms of the products they get in the quantities but they have set frequencies, they have set shipment dates, and that's really not what you see with something like a Dollar Shave Club or a Blue Apron. You know, the consumer's getting a lot more control over the package and, and the subscription there in terms of how often they get it, when specifically they get it, how easy it is to cancel, you [00:09:00] know, things like that.

Ramin: Yeah, I mean, and you guys call your, you know, your section in, in mm-hmm. You used the word subscription in there as well as club. I mean, so there are, you know, there, there you guys are definitely thinking and, and potentially also hoping that wineries approach maybe approach the conversation a little bit slightly.

Than they have been in the past. So I, I, I hope that that's, that's the case because we know how important the club is to the, you know, to the winery world. And, you know, we wanna make sure that and also, you know, maybe a little bit of it is the conversation, the, you know, leading up to. You know, maybe the tenure process, making sure people stay on.

I think we talked about wine pulse and one of the reports, one of the data points they pulled out was attrition and how high it was and it was growing and, and what do we do to fix that? What do we do to bring that down? All of these things matter and what the future of direct consumer looks.

What Software Inspires You?

Definitely. Mm-hmm. Let me just take one, one little step back. You know, when it comes to the technology and, and how you guys are approaching [00:10:00] things, what, you know, outside of the wine industry, what platforms and what software are you guys looking at for inspiration? Is there, you know, do you have a, a board up where, you know, it's this platform and that platform and we, we like some of the things they're doing and you monitor.

Zach Kamphuis: Yeah, we it, it really depends on the segment of the platform. Mm-hmm. So in terms of e-commerce mm-hmm. We love Bayard Bayard research. It's kind of the, the, the, the global leader in e-commerce research. Mm-hmm. So we le read a lot of the reports and that's actually what influenced our version two checkout is we base it completely around the Bayard best practice checkout.

Wow. We we take a lot of influence from shop. You know, it kind of is a competitor of ours in some ways. Right. But we do like the idea of the app store and how, you know, discounts are structured and different things like that. Mm-hmm. On the club side, we're really looking at, you know, global leading clubs or subscriptions in different industries.

So Dollar Shape Club is a big one that we look at. Blue Apron, a lot of the [00:11:00] food box or meal kit subscription service. You know, Ipsy or a lot of the, the beauty box subscription services we're taking a lot of inspiration from, from outside the industry and, and looking at kind of global leading subscription services there.

Ramin: Wow. And, and do you, do you pass that information along? I mean, I know it's internal and it's utilized for the software and cuz it, but you know, are you also passing that along to wineries and saying, Hey listen, you know, we're modeling some of our software around this and you guys should maybe look at the business model that some of these did you pass that along?

Zach Kamphuis: Yeah. 100%. A lot of these things are, are just best practice regardless of the industry. Yeah. Right. And for a lot of consumers, they're gonna expect some of these frameworks in the wine industry cuz they're used to them outside of the industry. Right. Right. If you belong to, you know, Netflix and a meal box and a, mm-hmm.

And a beauty box and all these other subscription services, and on all of 'em, you can cancel anytime on all of 'em. You can really easily customize your box and mm-hmm. And you get personalized [00:12:00] recommendations curated by the system for you. You know, that's kind of what you've come to expect. And, and that's what we encourage wineries to, to do as a best practice.

Right. Obviously, these, these huge companies are investing a lot in, in research on how to structure these. Right. And, you know, a lot of thought has gone into it, and, and they're doing it this way for a reason. And the reason is because it, you know, grows average order value. It, it extends retention, right?

It ultimately just increases the lifetime value of the member over the, the tenure of their membership.

Ramin: Yeah, no, the, these are such, such important you know, points that you, you're bringing up and I'm glad that you do that. You guys are big on education. I know that that's a big, that's a central part.

Who Uses Commerce7?

You, you were gracious enough to invite us to come on and do a webinar on, on email marketing, and you guys consistently do webinars all the time, and it, it's really great information. I mean, I, you know, as a, as a student, I'm always, I always feel like I'm a student just as much as I can be a leader. I try to be a student and, you know, absorbing that information.

So if anybody. Has not watched you know, jump in, go [00:13:00] take a look at the webinars. Just phenomenal educational series out there. So, so let's talk about just right now how many wineries are using the platform?

Zach Kamphuis: Yeah, we have about 1400 customers around the world today.

Ramin: Wow. Great. And, and what, what countries I'm assuming there's a big dominance in the United States, but where else, what, what, what's the other big, big area big part of the world that's starting to use Commerce seven more?

Zach Kamphuis: Yeah. So we operate in any English speaking country that produces wine. So South Africa, Australia, New Zealand. No, Canada little bit in Europe. About 90% of the wineries on our platform are in the us. But we're getting a, a decent base in in South Africa, Australia, and Canada there.

Ramin: And that, that's gotta be a, a challenge.

I mean, I know one of the, some of the software you brought out there was actually a call out for south South Africa, right? Mm-hmm. In terms of, I think, payment systems. Now you guys have to understand, you know, the nuances of all of these different platforms out there, or all these different countries, and they're [00:14:00] rules and regulations when it comes to.

Commerce, right? Mm-hmm. It's gotta be a pretty big

Zach Kamphuis: undertaking. Yeah, it's interesting. It's it's, it's you know, different regulations for sure, in, in some ways. Mm-hmm. There's also just some different ideas or, or thoughts from the wineries. So for example, You know, most wineries in South Africa don't have a club.

Right. The idea of a wine club is, is foreign to them. Mm-hmm. And it's not that you have to kind of talk them into how to structure the club but you gotta talk them into, you know, why you should have a wine club and, and, you know, interesting people actually wanna sign up for this and there's value here.

And in some countries in, in Europe You know, the conversation is that you sh why you should sell direct consumer. Right. A lot of the wineries are concerned with upsetting their trade partners. Right. And it's kind of always been this way and, you know, we're gonna continue doing it this way. And, and so it's, it's, it's it's different, you know, tech and regulations and, and things like that.

Mm-hmm. But it's also a lot of different. Kind of, you know, thought processes and ideas that you have to have to work with as well.

What Region(s) In The United States Are Using Commerce7 The Most?

Ramin: It's a [00:15:00] complicated business, the wine business. Especially a field in the United States. I mean, we know that there are lots of compliance rules and regulations that you have to monitor and be aware of.

And maybe not as many in other countries when it comes to the sale, but they're not there. They're not mentally there yet, right? They're not maybe mm-hmm. Embracing it because they, you said they have these, Relationships that they don't want to disrupt. Yeah, that's that's, that's, that's fascinating.

Well, let, let's and then, by the way, here in the United States just what, what states, I assume California number one, right? Yeah. On, on the list. Who's number, who's number two?

Zach Kamphuis: That's a good question. It probably either Oregon or Texas. Mm-hmm. I'd have to check. Yeah. Yeah. So California, of course, number one, you know, Washington State, Oregon, Texas, all very big.

Do you have a decent amount of East Coast wineries? New York State, you know, Tennessee couple other states as well on the, on the eastern side.

Ramin: We asked Remy this question from Wine Ptz about is there a, is there a winery in every state? And he says he doesn't think it's in every state, but it's close.

It's close, [00:16:00] yeah. Yeah. That's that it's, it's growing fast and I, I'd read, I think Alaska was on the list, which I'm like, wow. How does that work? How does, how do you, how do you do, how do you do that? How does that all work? Alright. Well, very nice. Well let, let's dive, let's dive into some some data a little bit.

So, you know, based on data you're seeing in commerce seven, you know, what areas of the DTC are you seeing growth in right now?

Zach Kamphuis: Yeah. If we're talking year over year definitely point of sale, definitely the club. Okay. E-commerce was down a little bit this year relative to 2021, but 2021 was a phenomenal year for all the channels.

Right. If we're talking over the last couple years, E-commerce is definitely the dominant channel that saw a lot of growth over the last couple years. Obviously, you know, saw a lot of growth in 2020 with the pandemic. But what we saw is we actually saw continued growth in 2020. And we saw a slight pullback in 2022.

But e-commerce is still up significantly as a channel from where it was in, in 2019. So that's, that's where we've seen a [00:17:00] lot of growth over the last couple years. But in terms of year over year what really drove the growth last year was the club and the tasting room. Hmm.

How Data Affects Tasting Rooms

Ramin: And are you seeing, I don't know if you can see this type of data, you know, what's happening at the tasting room level.

Are, are people, you know, are they getting email addresses? Are they, you know, are, are they being salespeople as well as being, you know, gracious hosts and you know mm-hmm. Servicing hospitality. Do you see a lot of that type of data or do you have opinions and thoughts on, on how tasting rooms should.

Zach Kamphuis: Yeah, definitely. So the data capture is extremely important. Mm-hmm. You know, we've known for, we look at the data every year and every year it's the same story in terms of the wineries who do a better job of capturing emails in the tasting room. They sell more online. Right. There's a huge correlation between email capture rate and, and online sales rate.

Mm-hmm. So that's definitely an important piece there. We are seeing this year. More than than last for sure. And hi, a higher average email capture rate, which is really exciting. You know, this is something that we kind of beat on[00:18:00] constantly and, and yeah. You know, always kind of promote as, as a really key way to grow your DTC sales is to get the email in the tasting room.

Mm-hmm. So what was exciting to see this year in 2022? We had the highest average email capture rate ever, which was awesome

Ramin: for the wineries there. Wow. That is awesome. That is really good to hear. So I was talking to one of the wineries that we were talking to, they have a, you know, because people are shy sometimes to ask for the email address, right.

It's a hard, it's a, you know, it's you know, you're worried about this person, how they gonna react when I ask for it. And they have a script, you know? Mm-hmm. And they train them, literally train them on, you know, Repeat after me, you know, that type of process. And I think that's great. So, you know, these exercises are, are great because listen, at the end of the day, I, you know, I gotta say that if I'm buying something, if I go to a winery and I buy something, and I, I'd like to hear back at least, you know, I, it's my choice to remove myself from a list, right?

Mm-hmm. If I don't wanna be on that list, I can do that. But I think, you know, especially if you are a winery that's focusing [00:19:00] on sending not just sales information you're sending. You know, informational content out to, you know, recipes and, you know, the how-tos and things like that. You should be proud to ask for an email address.

They're gonna, they're gonna enjoy getting your content. So that's a very encouraging sign to hear that that's really a, that practice is, is really being focused on on the tasting room level. What, what can they do in your opinion, you know, what, what things can they do from an e-commerce standpoint to.

Sales to really focus, you know, more on that side of the business. I, I, I know the wineries, you know, there's a bit of a struggle, right? Because they want people to come in to enjoy the experience, but then they have this other, you know, channel, you know, what's your, what's your thought and opinion on that?

How Capturing More Emails Will Lead To More Tasting Room Visits

Zach Kamphuis: Yeah. I think the best way to grow your, your e-commerce sales is honestly to capture more emails in the tasting room, right? Mm-hmm. You know, you're investing a lot in the experience that the consumer gets in the tasting room, right? Mm-hmm. The wineries invest a lot in the, in the training, as you kind of mentioned, right?

Invest a lot in the [00:20:00] decor, the landscaping, the property, all of. And when you get the email, you're able to capitalize on that investment because you can remarket to and reengage with the customer after they've gone home. And what you should be doing there is send them to the site to continue the relationship and get them to buy online.

Yeah, so that's, that's kind of the number one re you know, way to, to grow the e-commerce sales when they get on the site. It's all about you know, making sure it's really easy and, and fast to make purchases on the site. Mm-hmm. Right. Most consumers, when they come to your website, they're already familiar with the brand.

Right. They're there for a reason and you need to make it as easy as possible for them to kind of execute on that reason. Yeah. Right. So you see some wineries, they have. No huge videos and, and lots of copy and content on the homepage and mm-hmm we encourage people to kind of focus on, on making the sale on the site rather than telling the story.

Mm-hmm. Telling the story is really important, but when somebody comes to the site, chances are they already know the story, they're already familiar with the brand. Yeah. Mm-hmm. So, you know, we encourage people to be [00:21:00] really really focused on making it about shopping, then making the transaction easy by implementing things.

Mobile wallets. Mm-hmm. You know, heavily discounted shipping or, or shipping included and, and other things like that that are gonna increase the, the cart conversion rate

Ramin: there. Yeah. That's good. Well, you, whatever you guys are saying, it must be working because, you know, we have seen a shift you know, and we've been, you know, keeping watching for a long time now and, you know, there's less of that big, huge picture on the homepage of the beautiful landscape, which is beautiful and we wanna show it off.

At the end of the day, I think, you know, as consumers we want, show me where to go. Right, right. Show gimme the call to action button. And that was something we were not seeing so much of, not a lot of call to action buttons, but now it's like, boom into the sale process. Oh, it's

Zach Kamphuis: great. You know, people are coming into the site not as the first step in their journey, but typically as the, the second or third.

Right. They've, they've heard the story. In the tasting room and, and you know, through the email and they've clicked through and now they're there and they're there to shop, right? [00:22:00] Yeah. They're, they've already kind of heard the story and they're familiar with the brand and they already have the relationship there.

Ramin: Yeah. No, that's, that's great. Well, well, well said on that. And you know, I, you know, I, we will continue, I am sure we will continue to see more of this transition to, to commerce focus. And you guys do a great job of, you know, making the infrastructure easy to work with and also fast. You know, it, it's your point of fast.

I mean, that's we have as human beings we we're now irritated if we have to. You know, click on something and wait, and then it's, yeah, is it going to space and coming back? What's happening? You know, just get me to that next page so I can get that transaction. So I like that you guys are focused on that.

New Commerce7 Features

So when you guys January before the direct consumer show in Concord, California, you guys released a number of new features. So of those features, which ones do you think will have the greatest impact on the direct consumer side of the business? And I know you can. Just focus on that, you have to do other things too, within the platform.

Zach Kamphuis: Mm-hmm. Yeah. So we announced a, a number of features, probably my, [00:23:00] my favorite one. We made it so now a winery has the option of allowing a, a member signing up for the club to personalize the package before they actually complete the sign up. So typically what you see is, A consumer will sign up for the club and then when the first shipment comes, then if it's user choice, they can go in and make changes to the bottles and things like that.

Now wineries have the option though of during the signup process if there's an active package. The club member can, you know, add, remove bottles, change bottle quantity within the restrictions, the winery presets. Mm-hmm. All before the signup process kind of takes place. Wow. So I think that's, that's pretty exciting there.

That's

Ramin: huge. Yeah. That's a, that's a great, great addition. I love that. How many releases you guys how many releases do you guys do per year? Is it. You do big unveiling in January, usually

Zach Kamphuis: that's your big one. Yeah, Ty. So we'll do Commerce seven live annually. That'll be the big unveiling of some of the larger features.

Mm-hmm. But we released features, you know, weekly. Right. I think last year we released [00:24:00] about 180 features or, or updates. So we, we practice continuous deployment or continuous development. Mm-hmm. So we're, you know, we're pushing code every day to production. Incrementally small, lots of small little changes.

So it's, it's not like there's, you know, a weekly update or monthly update or something like that. Mm-hmm. We, we kind of we put right in the dashboard and the latest updates, but we we're, we're doing updates definitely on a weekly

Ramin: basis. And what I love is you told me the, the entire team's remote.

Zach Kamphuis: I mean, it is, yeah.

Yeah. Everybody's remote

Ramin: at Commerce seven. That's, that's a beautiful thing. I mean, we, we are too. And I, you know I, I think it's a great model. I mean, definitely in the software side of things and, and certain services that can work very well. But there's certain industries that still like, You know, they like the doors, they like the walls and things like that.

But as long as your team, you know, is collaborating regularly, I think that's a, you know, an amazing, you know, that you guys can continue to build such a great organization and then remain remote and give people that the liberties that they would like, you know, to, to work the way they wanna work.

[00:25:00] That's great. All right. Well, very nice. Well, so based on what you're seeing today and just kind of like looking out into the future, just a, just a little, several years maybe, what's what does the winery industry look like a few years down the road? Maybe five years, three to five years? What does it look like?

Zach Kamphuis: Yeah, it's, it's hard to say. I think at a kind of a macro level, you're gonna see a lot. Not a lot of, but you're gonna see some consolidation. Mm-hmm. Right. There's a lot of acquisitions. You see some private equity companies purchasing some really big brands. You see some really big brands acquiring a lot of mid-size brands, and you, you see kind of a lot of this consolidation.

You know, on the club side, we're seeing year over year more and more clubs are user choice. More and more packages are user choice. So you're probably gonna see continued kind of development there, where people are gonna continue to have more flexibility offered to their members in the, in the tasting room.

Mm-hmm. Other than that, you know, probably Probably some new marketplaces, right? There's, there's a lot of great marketplaces out there and, you know, [00:26:00] lots spring up and, and some gain traction, some don't, but you'll probably see some, some some new marketplaces as well.

How Will Commerce7 Approach US Winery Compliance In The Future?

Ramin: Do, do you feel that will continue to move towards, in, in terms of the compliance side of things?

Will things continue to become. Less restrictive. Will that you know, especially here in the United States do you see a big change in that? I mean, I know that's a, that's an ongoing battle and an ongoing, that's ongoing work, but where do you see that part of it? Just outta curiosity?

Zach Kamphuis: Yeah. I don't really have that educated of an opinion on that, to be honest.

I hope, I hope it gets less restrictive. Mm-hmm. But Not too sure. We don't really touch on the, the compliance or the regulatory side too much. We, we lean pretty heavily on our partners like Avalara and Ship compliant for

Ramin: that. Yeah. To take care of that part of it. Yeah. That's good. Probably better.

Better that way. Cause I know, I know. It can be complicated. That's a very, very complex side of things. So let's time to put on your marketing hat for a moment. And if you were gonna advise a winery on marketing, you know, which initiatives would you advise them to? They can't do them all. Maybe [00:27:00] budget's a concern.

What would they focus on to drive more traffic? Retain more customers, retain more club, club customers? What, what would they be?

What Wineries Should Focus On To Drive More Traffic

Zach Kamphuis: Yeah, I think there'd be a couple things there. So in the tasting room, I think Winers are doing a great job today of mm-hmm. You know, making connections and building the relationship and, you know, having conversations and things like that.

And I think one big initiative is, you know, you definitely wanna lean heavily into training the team to continue that, that success there. But also Documenting and, and inputting a lot of that data that you capture in those interactions into the system and to leverage in the future there. Right, right.

If somebody likes a particular style of wine, if somebody is local or non-local mm-hmm. You know, things like this can really be leveraged in the future, in your, in your marketing efforts. Right. And, and this is kind of one of the best places. Well, it probably is the best place to capture a lot of this, right?

This information is in the tasting room, so really important to keep educating the staff on having those conversations, but [00:28:00] also, you know, capturing and inputting that data into some system mm-hmm. So that you can remarket to the visitors after they've gone home. And when you remarket to them, making sure that you're, you're being as, as personalized as you can rather than generic.

Right. Right. Yes. If you, if, you know, if I come in and I say, I don't like chardonnay, and you document that. Then, you know, not to have me on the list when the the Chardonnay offer goes out. Yeah, I think that's gonna be kind of the, that would be the key thing there is, you know, collect, collect as much as you can that's relevant.

Mm-hmm. And then leverage that in your, in your remarketing efforts. Make sure that you're, you know, segmenting and personalizing during your, your remarketing efforts.

Ramin: Yeah. And so, I mean, you know, in my head that speaks to both an onsite experience. You know, we think you know, obviously, you know many, you know, some of the big huge e-commerce companies, you know, know, very, know a lot about you.

So when you come back, You know, you're seeing very specific information as tailored towards you. And you're right. Don't show me, you know, if I don't like white don't show me. Mm-hmm. Show me my reds you know, I'm interested [00:29:00] in buying that. And then also speaks to, you know, I think email marketing and eventually SMS marketing, you know, those two components, you know, that has a, those two have obviously very, a big opportunity to personalize the experience and segmentation.

I mean, really at the end of the. It's funny, we talk a lot about, you know, don't blast that list. Don't blast the whole list, really, you know, bring in your segments, focus on your segments, because you're gonna have a much higher open rate. You're gonna have a much higher clickthrough rate. These are all gonna work better if you're speaking, even if the, even if it's 10 people in that segment, you know, it's, it's the most qualified, 10 most qualified people to purchase that particular wine.

And you're gonna see much, much better levels. Any, anything else on the marketing side that comes to mind that you would that you were just hoping that wineries would do?

Zach Kamphuis: Yeah, I think the last thing would be to consider Club members in different locations. Right. So when you're talking about the club today and, and how the club's marketed, a lot of the great benefits are all localized.

Mm-hmm. Free [00:30:00] tastings, events, pickup parties, things like that. Those are all really great. Continue to do those. But you're gonna have a lot of prospects that are are not gonna really find value in those, in those benefits because they're non-local. Right. They live in a different city or a different state.

And so kind of what, thinking through what kind of value you could offer. How you could present them that value. You know, we kind of lean heavily into the value for them is the convenience of the club. If you give 'em the flexibility to change the products and the quantities and the shipment dates and the frequencies and all of that.

If you make it all about the convenience then if these, these members are kind of good, good targets to, to pitch that convenience to you know, obviously market that to them, right? If I live in a different state and you send me an email and you say, sign up for the club, you get a free tasting and you get to come to this great event, you know, twice a month or something like that, well, I don't really care because I'm not, probably not gonna.

Go there that often. Right. But if you pitch it all around the convenience for me, Hey, free shipping. Mm-hmm. Pick whatever you want, skip [00:31:00] anytime, cancel anytime. Get this great discount, access to these rare, rare wines, things like that. Yeah. You know, that's obviously gonna be a lot more impactful. And, and we're seeing today a lot of, a lot of members are actually signing up online.

About 20% of members for, for commerce seven wineries sign up online. So it's important to consider these, these people and to, you know, market appropriately to these. Wow.

The Commerce7 App Store

Ramin: Well said. That's a, that's, that's a, that's a wealth of knowledge. I love that. Okay let, let's maybe just, we'll just jump back real quickly to the technology side of things because you guys are putting a big emphasis on your app store.

You know, what types of apps are you seeing, you know, wineries starting to download more and more.

Zach Kamphuis: I think the average commerce oven winery has about five to six apps. Okay? So we're, as a business, hyper-focused on the transaction, right? Mm-hmm. The customer's shopping experience. You know, we think the shopping experience is the number one reason why consumer's gonna choose their brand.

And so we're hyperfocused on making that shopping [00:32:00] experience the transaction fast, easy, personalized. Okay? Obviously wineries are gonna have a lot of other needs, right? Mm-hmm. Marketing reporting fulfill. Accounting, things like that. And so for us, the idea here is rather than. You know, be jack of all trades, master of none.

Mm-hmm. We're gonna be the best at the shopping experience and then we're gonna make it really easy for wineries to work with the other systems that they wanna, that they want to use for marketing and, and reporting and things like that. So, yeah. Most people today, they're using a fulfillment app. If they're fulfilling in house, we've got apps for that.

If they're using a carrier or a fulfillment house. We're integrated with all the major fulfillment houses. So typically everyone has one fulfillment app. Typically everyone has a marketing. Right. Klaviyo, MailChimp. Mm-hmm. Something like that. And then you're seeing some people have different accounting integrations, like we're integrated with QuickBooks Online Desktop Zero.

People will be integrated with different reporting solutions like Wine Pulse is a good example there. So yeah, marketing, reporting, [00:33:00] fulfillment, those are kind of the three big categories I'd say for the.

Ramin: Yeah, I, I really love that you guys are, you know, focusing on your app store, you know, continuing to, you know, foster it and grow it.

You know, I think back to, you know, 2000, maybe 14 when I was first introduced to Shopify, you know, I had been on many other platforms and, you know, I saw their app store and it was always very intriguing to me that, you know, handing, you know, a platform can only do so much, right? Mm-hmm. It can, it can only be so many things to, to, and it literally, Handing this off the baton off to certified developers who can build and extend the capabilities of the platform is a, is a really genius move.

And I, I really like that you guys are doing it. We watch it all the time and we're always thinking too on our end, like, you know, what app could we, could we, you know, build that would, you know, help wineries. Sell more product, track more, you know, information. You know, obviously we love the e world of email marketing and you know, how does it p play into that?

So we've got our eyes [00:34:00] open. We're gonna come, we'll come to you. We'll, we'll come to you and bounce some ideas and you know, what, what are they looking for and what you know, how can we help? Because I think it's you know, something that, you know, and I like to you telling that many wineries, that many apps, that's a lot of apps that you know, they're downloading so they, they're embracing it.

I can, you know, it definitely looks like yeah,

Zach Kamphuis: we we actually put out some apps ourselves, so some of them may be our own apps. Yeah. The idea there is we don't want to have the system. Cluttered with Sure. You know, if, if there's a tool we have and we offer, but you're not gonna use it mm-hmm. Then we'll just get it outta your way so the UI stays nice and clean.

So some of those apps are our own apps. Mm-hmm. But most of i, I know the most popular app, I think is the MailChimp app. Probably followed by like Shipo or self-fulfillment app, but yeah, lots, lots of wineries using lots of apps on the system, which is

Ramin: great. Yes. Well shout out to Bodie and Digimatic.

Mm-hmm. Good, good. You know, quality, quality software is being, you know, he's working on quality software and that's a, that's an important element like, You know, developers. Yeah. You just gotta build good. You have to, you have to understand what you're building on and [00:35:00] understand the audience that you're building for.

And then ultimately, you know, bring a solution to the table that, you know, there's no, there's no such thing as bug free. You know, as you, as close as you can get to, you know, making software that is It doesn't have bugs or is limited, and then you quickly squash the ones. But yeah, Dematic they do a great job.

How A Winery Can Capitalize On DtC In the United States?

Bodie does a fantastic job on mm-hmm. On his software out there. All right. So, you know, if you owned your own winery and maybe let's just say the United States for the sake, because it's such a, you know, it's a big market for you guys, you know, what would you, you know, how would you approach things to capitalize on the direct consumer market?

What would you do for Zach's Winery? Yeah,

Zach Kamphuis: no, that's a, that's a good question.

Ramin: Maybe you, maybe you wanna have a winery? I don't know.

Zach Kamphuis: Maybe one day. Okay. All right. But yeah, no heavy, heavy emphasis on the data capture in the tasting room. Heavy emphasis on the, the segmentation and the slicing and dicing of that data and the remarketing efforts.

Heavy emphasis. Providing as much flexibility as possible for the [00:36:00] club and subscription model there. Mm-hmm. Right. Those would be kind of the three big things. There's lots of other things of course, as well. Sure. You know, build the cost of shipping into the price of the products, offer shipping included other things that just kind of help increase card conversion.

But, you know, really the data capture, the segmentation for the remarketing and the. The, the club being as flexible as possible. That's, that's what we see drive the most revenue mm-hmm. Of, of what our clients do. And so that's definitely what I'd have an emphasis

Ramin: on. What would you, what three apps would you add to your store?

Zach Kamphuis: Definitely one of the, the Dematic options. Okay. Mail Chamber, Klaviyo. Mm-hmm. That is a good one for sure. And then if we're talking about just sales apps mm-hmm. Mm-hmm. I'd say the Red Chirp text message marketing app is really great. The Facebook conversion tracking app is, is really great, but if we're talking about non-sales apps, definitely.

Shipo for self-fulfillment. Okay. Yeah. And QuickBooks. QuickBooks Online integration.

Ramin: Nice. Nice. All right. [00:37:00] Look at, there we go. It's available.

Zach Kamphuis: Yeah.

Ramin: Quickly pen. Wow. Before the, before this podcast is over. Grab that. Nice, fine. Nice. Fine. Michael, we got Michael working in the background. Love it. Love it.

Wow. All right. This is, you have, honestly, this is I. All I can say about today is I'm walking out so much smarter than I came into today between our first podcast with Remi at Wine Pulse and, and you, I mean, just important information that we, we continue to be students and learn as much as we can about this industry.

And it's a, it's a very, it's an industry that has, you know, a lot of deep relationships. You know, people, you know, very tight industries we talked about earlier. But an industry that's continuously looking to evolve and, and how do they get to that place? You know, how, how do they make all of these channels work well together?

So I really appreciate you putting that information in, in front. And, and if there's anything I missed and you'd love to just share it, now's your [00:38:00] chance. Jump in. If there's anything you'd like to say, please do so, unless we covered it all. Yeah,

Zach Kamphuis: no, I think You know, I've, I've kind of beaten it to death here in terms of the, the data capture and mm-hmm.

And you were telling me about that winery that had this script for the Yeah. The email capture. Mm-hmm. You know, I will say in terms of getting the, the data, cuz that's a question we get all the time. Hey, I understand this is important to do. Yeah. How do I do this? So how do I go about doing this? And, and so we talk to the wineries in our system that do a great job of this.

Mm-hmm. We ask 'em what they're doing and how they're getting such a high capture rate. And you know, the common threads there are. They, the wineries that have a, do a great job of this, they explain, they take the time to explain to the team why we're doing this, why yes. Why this is important. Mm-hmm.

Right. And then they arm them with you know, meaningful invitations to give to the clients. Yeah. And if I come in and, and you know, I come into your winery and you say, Hey, you wanna get 10% off? Give me your email, join the list. You know, you're just gonna get a bunch of junk emails that don't have a lot of value to [00:39:00] them.

Right? And so if you're having those conversations and, and, and building those relationships, You know, you can use the information. You kind of find out about the guests, what they like, what they don't like, where they live to offer more meaningful invitation to join the mailing list. You know, hey, sounds like you're, you're headed back home to different state.

We got some great shipping offers coming out. Would love to you, for you to be in the loop on them, or, you know. Mm-hmm. It sounds like you're local. We've got some great events coming up. We'd love for you to know about them, or looks like you really love the Pinot. We're gonna have another vintage coming out.

It's gonna be limited release, it's gonna sell out quick. Would love for you to be the first to know about it. You know? Can I get your email so you can be in the loop? Yeah. That, that's what we kind of see as, as being successful in terms of the data capture.

Ramin: That's great. Yeah. Giving them the reason, the, the why behind all of this.

Mm-hmm. And yeah, you're right. It is a conversation at the end of the day. I mean, any, you know that that's a retail experience, right? The, the tasting room, you're, you're standing in front of somebody who you're meeting for the first time. Mm-hmm. But doesn't mean you can't have a good conversation with [00:40:00] them.

And you're right. You know, here's 10% off, you know? Okay. All right. Maybe, I don't know. But are they truly into it? Are they truly into being a part of your brand as opposed to. These are all the things, like you said, these are all the things that we have and Yeah, tailored, you see them drinking Pinot, why not talk to them about, and you happen to know the next vintage is coming out.

Let's get that in front of them.

Why Segmenting Your Winery Customers Is Important

Zach Kamphuis: Yeah. And you mentioned the, the metrics of, you know, segmenting, right? Obviously the open rates are better and click through rates and unsubscribes are lower. You know, that all improves when you, when you offer the meaningful invitation and you have the, you have the context.

Sure. And you use that context to segment. So it's kind of twofold there. Getting the context helps you give that meaningful invitation. Then it also helps you segment

Ramin: later. Yeah, no, beautifully said. Beautifully said. Well, You good. Jumping into some rapid fire questions? Sure, yeah. Let's, as we wrap this up we've been talking about some, some heavy D T C stuff and now let's get into just, you know, some fun stuff.

Mm-hmm. Alright, so [00:41:00] what's your what gets you excited to wake up and tackle each day? What, what's your motivation?

Zach Kamphuis: Yeah. I like to see the growth of the, the company and the growth of the clients. Mm-hmm. You know, some clients have been on the system. Five years or four years and, and we can see a tangible difference.

And you know, the, they're real people, right? We have conversations and I, I, you know, I know their spouse's name and the kids' names, right? And you can kind of see this, some of these businesses go from a part-time. I'm nervous about starting this kind of business to something that's growing, into having employees in a big club.

And that's really exciting to see. And it's also exciting to see it with our own business. You know, as we grow people. Get promoted into different positions and the company grow and expand and it's, yeah, it's really exciting to see all, all the growth of the clients as well as the company.

Ramin: Oh, that's great.

That's great. And you know, on the personal side, you know, just watching you guys interact at the show back in January, you know, it is, it's that, you know, you, you very approachable, very friendly, you know, [00:42:00] and everybody knows everybody. And you see the same people probably at every, every year at the show for sure.

Rapid Fire Questions

And how can you not help but ask about, you know, How's your family, you know? Yeah. Know who they are. Mm-hmm. Just people. Mm-hmm. All right. So what's your drink of choice in the morning to get you

Zach Kamphuis: going? Drink of choice In the morning or, or just in general? Let's start with the

Ramin: morning. Okay.

Zach Kamphuis: Let's start with the morning. Yeah, just, just black coffee. Okay.

Ramin: All right. Boy, ding, ding, ding. That's like 95%. This is the 30 30th podcast. Nobody drinks. Very few people are pouring something in their coffee. Very

Zach Kamphuis: few people. Oh, I have, I pour MCT oil into my coffee. Oh, okay.

Ramin: Now we're talking.

All right. All right. Now since we're talking wineries what's your wine of choice? And you don't have to give out a brand, cause I know you, there's 1400 brands that are part of the world, but is there any type of just gimme, gimme your, go-to wine that you.

Zach Kamphuis: Yeah, probably like a bold, bold red. I'm up in in Vancouver, Canada.

Mm-hmm. So by the Okanagan, so I belong to the Phantom Creek Wine Club. Oh, okay. Yeah. Really cool winery. Fairly, fairly new. But they got an amazing [00:43:00] tasting room out there. So I love, love going up there. Really like the wines in BC as well. Nice. Really great wineries.

Ramin: Do they treat you like royalty when you walk in?

Just curious.

Zach Kamphuis: I don't want to say that I work for Commerce seven sometimes cause I don't want, you know, yeah. I don't want to hassle them or anything. Yeah. No, that's

Ramin: cool. They, I thought maybe they see you coming and the red carpet comes out and it's a different, the, the back room, sir, please. This is where we have the special tasting.

Yeah. Maybe one day. That's awesome. Yeah. That's very cool. So if you could do one job besides the one you're doing today, what would it.

Zach Kamphuis: I can do one job besides what I'm doing. I like working in software. I think it's a lot of fun. Mm-hmm. Like working in sales, probably probably like account executive at a different software company, like small companies, so yeah.

Yeah. Ideally a startup. Nice.

Ramin: Nice. All right. That's very good. All right, so on the topic of software, what's your go-to? SaaS? Software or app? Yeah, the one you can't live without. You gotta, you gotta check it in the morning, gotta check it halfway through the day and into the evening.

Zach Kamphuis: Yeah. HubSpot, [00:44:00] that's our crm.

Everybody here lives and dies by, by HubSpot. Wow. We use it for support. We use it for sales, we use it for marketing. Everything lives in there. So that's, that's open all day, every day, for sure.

Ramin: All day. Very nice. Good, good, good, good piece of software too. Mm-hmm. So if you could give yourself one talent that you currently do not have, what would it be?

Zach Kamphuis: I can give myself one talent. Hm. Probably something product development related. Okay. Yeah, it'd be it'd be interesting to be able to kind of understand that side of the business or, or that side of SaaS a bit better.

Ramin: Nice. Nice. Yeah, that's good. That's good. I, I, I, I'll say design cuz I'm a probably frustrated designer.

That's why can Canva is so nice for me. I, I can make anything look good in Canva. Very nice. Okay. All right. Well, all right. Tell me this to, to kind of wrap this all up. What's your favorite online store and why?

Zach Kamphuis: This is such a lame answer, but Amazon, right? Because of the, that's good. The selection and the speed, the convenience.

Yes. Outside of [00:45:00] Amazon, I like Bulletproof, Bulletproof Coffee. Yeah. Okay. Yeah, that's where I get my like mc two oil. Pretty good, pretty good site there. But yeah, definitely Amazon, which is kind of, kind of

Ramin: a boring answer. No, but you know, it's funny, I, I think a lot of people are you know, fearful of saying Amazon because, you know, like, oh, it's, I love that you said it because I'm all on board.

The fact that I can within seconds order something on my phone. I mean, it doesn't, you know, talk about a user experience, right? I. Amazing user experience. Mm-hmm. They get you from the front door to checkout so quickly. That, you know, and I think just as a, you know, as a e-commerce, you know, being, being in this industry, I'm always watching, like, how, how does that user experience work on every single site?

So I'm, I'm with you a hundred percent. I saw Michael in the background cheering when you said that too. So I think we're all, we're all with you. On that. And we're not, and we're not embarrassed to say it either, so Good. We'll stand at the trio three here that are into it. Well, this is, this has been great.

Zach, I, you know, [00:46:00] again, appreciate you taking the time. I know you've got many things going on over at commerce seven, but maybe just you know, given some insight here on the DTC consumer commerce, the commerce side of things, Four wineries is so, so important. But if you could just take a minute and tell everybody, for those who don't know about Commerce seven, where they can find information about commerce seven.

We have a QR code also up on the screen that people can scan and take you right to your page. But maybe just tell 'em, give 'em a second.

Zach Kamphuis: Yeah, definitely. Commerce seven.com. Of course. Right? You can if you're interested in taking a look at the system, you can book a demo there. Happy to walk you through it if you're not interested in taking a look at the system.

We've got a lot of great educational stuff. Yes. Coming out, we've got our annual data book 2022 data book coming out probably next week. It's finished. Oh, wow. It's working on the landing. Awesome. And so that, yeah, that's gonna have lots of great insights in ter terms of how people, how our client base or aggregate customer base is using the system.

What's working, what's not working. Wow. So [00:47:00] subscribe to the newsletter. We'll send that out to you. Lots of great insights in there, regardless of what system you're using. It's platform agnostic. So that's cool. Yeah, check, check that out when it comes out next week.

Ramin: I, I can't wait for that. I, I do love these data books.

I'm, I'm a fan all of them. I love anything that can get my hands on. And just by the way, as a little side note to everybody in our intake notes Zack mentioned that not so long ago, he was terrified of public speaking and I gotta say, I don't know where of what you, you, you're like a natural up there on on the camera.

You, you're calm. I, I watch your presentations. You're cool, you're cool up on screen. So you did something. I don't know, did you take classes? Did you, did you study?

Zach Kamphuis: No, I, that's well that's, that's great to hear that I come across that way. Yeah. Yeah, no, you know, just kind of doing it regardless and, you know, getting more confident with it.

So yeah, I know I've had a lot of, lot of practice through, through the role here. Yeah. And Yeah, it's been a good learning

Ramin: experience. Yeah. What better way to get over something and just throw yourself into it, right. And just mm-hmm. Just make it happen. Exactly. Yeah.[00:48:00] Very nice. Very nice. Well, thank you very much again for coming on.

You know, it's been pleasure. Thank you for giving us the opportunity to, you know, talk to your talk to your winery clients out there and just really, you know, get the word out on what we do and just all in all, fantastic industry you guys. Fantastic software and we love to see the evolution. Can't wait for that data book.

That's we will sit down, I'll sit down with a glass of wine, of course, like I did with with wine pulses recap and sip a little bit and read and see if I can pull out some nuggets of information out of there. So thank you very much Zach. Hope you have a great weekend and we'll get this we'll get this out there, broadcast this out to the world.

Okay.

Zach Kamphuis: Awesome. Well, thanks again for having me and thanks again everybody for, for taking the time to.

Ramin: Of course, of course. All right, that brings us to the end of another podcast, second one for today. Happy. It's been great. It's Friday. We're, you know, love talking about this topic, really working to help wineries grow their business.

Don't forget to check out our past episodes at s k u [00:49:00] agency.com/podcast, or you can check 'em out on. And as always, if your winery needs help creating and executing email marketing automation strategies, our team can definitely help you. Zach talked a lot about you know, what that world looks like, segmentation really, you know, working to capture that email address.

So go to sku agency sku agency.com/wine and book a call, and we will talk to you and help see if we can help you grow that side of your business. So, until next time, everybody see you.

Conclusion

Our live conversation with Zach Kamphuis from Commerce7 has shed light on the incredible impact of direct-to-consumer (DTC) commerce on the wine industry. Commerce7, as the industry-leading commerce platform, is at the forefront of streamlining e-commerce and creating more sales opportunities for wineries, both online and in-person.

Through our discussion, we've learned why DTC commerce has become paramount for wineries and how Commerce7 is equipping them with the necessary tools and resources to succeed. The emphasis on creating unique customer experiences and bringing a human touch to the customer journey has been a key takeaway from our deep dive into Commerce7's innovative approach.

As we look towards the future of the winery business and DTC commerce, we're excited to see how Commerce7 continues to drive profitability and customer engagement for wineries. We hope this episode has been enlightening and informative, and we encourage you to stay tuned for more insightful conversations on the latest trends and developments in the wine industry. Cheers to a thriving future for wineries and DTC commerce!

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