On Day 2 of the International Bulk Wine & Spirits Show in San Francisco, Adam Billings of IMI Agency reviewed the key factors that go into cracking the code of on-premise national accounts. Right now, says Billings, all major on-premise accounts are looking for a unique program, and not a cookie-cutter program. That’s the good news. The bad news, says Billings, is that many account managers have not yet woken up to the idea that private label wines can provide the type of competitive differentiation that they are looking for.

Currently, we are in the infancy of private label wines in chain restaurants and hotels. However, there are a number of important factors that are acting in favor of these private label wines, such as consolidation and the reduction of different brands that are available to these establishments. At a time when everyone wants to differentiate themselves from the competition, the emergence of the private label trend comes at exactly the right time. At one time, it might have been the norm to have similar wine programs across the board, but that is no longer the case.

There’s just one problem, though, says Billings. And that’s the fact that account managers at hotels and chain restaurants do not yet fully understand how the private label wine strategy really works. If you get a meeting with them and mention “private label,” the first thing they will naturally assume is that it will require huge stockrooms, more inventory, and a lot more SKUs. They will then start to worry about running out of inventory. That’s particularly worrisome, says Billings, because the average on-premise establishment only offers 7 different wines by the glass. Running out of one or more of these wines would have a serious impact on the establishment’s bottom line.

So how do you dispel the rumours and get past the misperceptions? One way, says Billings, is to have the right brand, the right positioning and the right timing. The private label brand should match up well with the brand of the on-premise establishment, it should meet a perceived customer need or preference, and it should come with managed expectations about the timing. Most private label wine projects, says Billings, take anywhere from 6 to 8 weeks to develop. That’s why timing is so critical.

To illustrate these three points, Billings uses an example from his own recent experience. He recently walked into his favourite retail liquor store, picked up a bottle of his favourite bourbon, and immediately noticed something different. At first, he thought it was a special limited edition of the bourbon, or that it was some other type of special commemorative bottle. But it turned out to be something much more mundane – the bourbon bottle simply had the name of the liquor store on the label. According to Billings, that’s exactly the wrong type of co-branding experience for wine or liquor brands. Simply including the name of the establishment on the bottle does not enhance the brand if it’s not done right.

In terms of establishments getting it right, Billings points to P.F. Chang’s, which recently launched a popular private label brand – “&” – to celebrate its partnership with the Browne Family Vineyards in Washington State. The “&” is a direct reminder of that shared relationship, and it’s also a reminder of the pairing of Asian food and wine. When restaurant patrons usually head to an Asian restaurant, they might not think about ordering wine. But the presence of such a powerful private label brand in-house helps to get patrons at P.F. Chang’s thinking about wine.

Another great example of private label wines done right is Morton’s, the famous national steakhouse. In fact, Morton’s has had so much success with its private label wine program that 25 percent of all wines sold by the glass is actually private label wines. Billings attributes much of this success to the forward thinking of the restaurant’s wine director, who has been very proactive about replicating the success of well-known brands in the marketplace (such as The Prisoner Wine Company) and then putting Morton’s own unique riff on the brand.

In terms of landing meetings with these accounts and selling a private label program, Billings advises selling the vision and not the process. What he means by this is that many of the key decision-makers at these on-premise accounts have neither the time nor the desire to go into all the details of how the wine is made and brought to market. Instead, what they care about is how well the wine will help them deliver on key metrics like revenue and customer satisfaction.

Also, says Billings, the whole private label wine sales cycle might include as many as 30 meetings over the course of 2-3 days. Each meeting will last for 45 minutes, tops, so it’s important to get to the point fast. Only provide as much information as will be needed for these decision-makers to come up with a final decision within a very short period of time.

One way to win over these decision-makers, says Billings, is to conduct blind tastings. Even if your private label wine is not chosen as the best wine in the tasting, the very fact that you are willing to have such a tasting says a lot. And, adds Billings, the majority of clients at his agency do them, so tastings are really more the norm than the exception.

And, finally, it’s important to focus on building a long-term, lasting relationship. This implies consistent engagement, multiple touch points across the account, and impactful presentations. The multiple touch points are key, says Billings, because you want to make sure you have plenty of connections to the client in case your primary champion leaves for any reason. In terms of giving impactful presentations, suggests Billings, “less is more.” If you plan on giving a presentation for more than 45 minutes, you will only end up losing the client in the end.

By taking all of these factors into account, you will be well positioned to pitch big chain accounts. By thinking the way these major on-premise accounts think and by offering them a highly visible point of competitive differentiation vis-à-vis their rivals, you will be well on the way to cracking the code of national on-premise accounts.

2019 IBWSS SAN FRANCISCO DATES ARE OUT

The dates for next year’s event will be July 23-24, 2019. A special early bird period is now open for 2019 IBWSS San Francisco exhibitors who would like to take advantage of the best offer to exhibit. The offer ends Nov 20, 2018.

So if you are keen to join the event as an exhibitor and would like to save some money and use that towards your airline and hotels when you come to SF next year – we encourage you to reserve your spot by end of next month which is Nov 20, 2018 and you will be able to get the best deal which will save you $600.