Direct-to-consumer (DTC) relationships are crucial for craft spirits brands because they allow for deeper connections and direct feedback loops between the brand and its audience. Unlike large, mass-market companies, craft brands often appeal to niche, discerning consumers who value authenticity, storytelling, and quality ingredients.
By selling directly, brands can bypass traditional retail channels, retain more control over the consumer experience, and capture valuable data on customer preferences, which informs product development and marketing strategies.
DTC channels also enable craft spirits brands to communicate their unique values and production methods, fostering brand loyalty and creating a community around their products. This personal interaction not only enhances the consumer's experience but also empowers brands to build lasting relationships that fuel sustainable growth in a competitive market.
2023 Direct-to-Consumer Spirits Shipping Report by Sovos and the American Craft Spirits Association highlights that 87% of regular craft spirits drinkers desire the ability to purchase directly from producers, underscoring the potential benefits of DTC strategies.
First-party data collected from opt-ins, purchase history, preferences, and demographics, empowers brands to tailor their messaging and product recommendations to specific consumer segments, which can significantly boost sales conversion rates and customer lifetime value.
Brands are turning to subscription and club programs to secure recurring revenue and deepen customer loyalty. Programs often offer consumers exclusive access to curated selections, provide consistent revenue streams and reduce reliance on one-time purchases.
Subscriptions enable CPG brands to anticipate demand, optimize inventory, and build predictable sales models. Club programs, often associated with premium perks, exclusive products, or early access to new releases, further engage consumers by creating a sense of community and exclusivity. This model is not only boosting revenue but also providing brands with critical insights into their most loyal customers' preferences, fueling sustainable growth.
Retention cost to get a customer to repurchase products via eCommerce varies across industries but typically falls between 15-25% of Customer Lifetime Value (CLV). For CPG brands, this may mean investing in incentives such as discounts, loyalty rewards, targeted email campaigns, and remarketing ads.
A study from Recurly suggests that, on average, retention marketing expenses can range from $7 to $10 per customer per month.
Guests that experience your brand through experiences are a captive audience with a new found emotional attachment to your brand. They are most inclined to make a retail purchase on site, visit your website after the experience and have a higher lifetime value.
Selling directly to consumers creates multiple opportunities for brands:
- Bypass traditional retail channels
- Capture valuable data on customer preferences
- Retain more control over the consumer experience
- Educate and convert consumers into loyal brand Ambassadors that drive growth
The craft spirits industry is at a pivotal moment where understanding and capitalizing on customer relationships, data, and loyalty programs can significantly impact growth and sustainability. By prioritizing these elements, brands can navigate challenges and seize opportunities in a competitive marketplace.
AnyRoad membership programs and bottle clubs offer exclusive benefits and foster a sense of community, encouraging repeat purchases and brand loyalty through experiences.