ARE YOU KILLING YOUR “GOLDEN GOOSE”?

 

So, what is your “Golden Goose”? Well, very simply, it’s your customer file – what we term in the business as your “house file”.

What prompted the idea that wineries might be killing their Golden Goose was what we recently heard at the 2024 DTC Wine Symposium – specifically, that new customer acquisition was sluggish and that most folks seemed to be leaning more and more on squeezing every last penny from their house file.

Please understand, there is absolutely nothing wrong with maximizing your house file revenue. That said, relying too much on existing customers can be dangerous, especially if you lack the sort of segmentation and/or scoring it takes to know which customers to focus on and how often to reach out to them. Let’s be honest, no one likes to be sold or intruded upon with a never-ending barrage of emails and texts – even if they do love the wine itself.

CARE & FEEDING

Before we discuss certain obvious signs that your house file may be fatiguing, let’s first discuss the idea of “care and feeding”. The very basics of this includes list/data hygiene. Is your house file (yes, this includes your lapsed customers) regularly scrubbed by pushing it through NCOA or ECOA (National Change of Address and Email Change of Address records, respectively)? If not, you’re making a mistake, because as shocking as it may sound, people do change their addresses and emails!

This type of work is necessary for a variety of reasons, not the least of which is the idea of lapsed-customer reengagement and/or data enhancement (more on this in the future) as both require clean and up-to-date emails and physical addresses.

SIGNS OF FATIGUE

There are certain obvious signs of house file fatigue. What they all have in common, however, is an eye toward trend analysis. How are your opt-outs trending? How about your open rates, click-through rates and/or AOV? What about your churn rate (customer retention rate) – is your “tribe” staying with you longer, or are they leaving more quickly? More importantly, are your LTV analytics sophisticated enough to even know?

These are tried and true techniques, used throughout various DTC industries, to enhance LTV and customer loyalty. These need to find their way into the DTC wine business, obviously.

Of course, the best way to not rely too heavily on your house file is to develop a more robust customer acquisition strategy. As we all know, there are significant headwinds throughout the industry and the pond that most seem to be fishing from is drying up. That said, with strategic innovation, certain players are finding other ponds to fish from… smart!