After due consideration, Adam Strum suggests a viognier as an appropriate wine with which to surf the Internet.
“Or if you prefer a red, something light and fruity, like a sangiovesa,” he adds.
Strum should know. A former wine merchant, Strum and his wife Sybil founded The Wine Enthusiast 20 years ago to cater to people who want to maximize their enjoyment of wine.
But while wine may have virtue in vintage, Strum’s marketing of wine cellars, glasses and other related products and accessories is anything but aging gracefully. His Web site-www.wineenthusiast.com-earned about $1 million in December 1998 alone.
“It’s an active site,” Strum explains. “It gets 400,000 to 500,000 page views a month.”
The three-year-old site also does well on non-holiday months, growing from $100,000 in sales in January 1998 to $800,000 in January 1999. Web orders, says Strum, go directly into the operating system and “kick out” the next day.
Little wonder he plans to double the number of people in his in-house Web group from four to eight this year.
Customers find the site through the catalog, space ads in newspapers and magazines, and even banner ads. Response tends to be hybrid because of what Strum calls the consultative nature of his business. Customers will click on the site, then, on impulse, call the toll-free number to talk to a sales representative.
“They’re there making the sale because the environment creates a mood to buy,” he says.
Strum reports a 15% overlap between Web and catalog buyers. Web buyers tend to be younger by about five years and “Web-literate,” as Strum calls it. Unlike catalog buyers, Web purchasers do not make multiple purchases. He also suggests that the attention span of the typical Web buyer may be shorter, so the Web site itself has to be “a little snappier.”
Buyers, however, are just as affluent. The typical customer ranges between 35 and 40 years old and is as likely to be female as male-but men are more likely to order large temperature control cellars than women.
Strum described the product selected as dual-faceted: lots of high-end products, not only cellars with all the trimmings, but also holiday-driven gifts of wine accessories. Cellars, he adds, also do well during the summer because serious “wine enthusiasts” are concerned about the heat and how it may affect the taste and longevity of the wine.
Strum like the free reign Web sites allow marketers. “I think I get a good deal on the Web,” he says. “The Web is a cataloger’s friend because it’s in real time. I can provide special pricing. With a print catalog, I’m locked in for months. With the Web, I can make changes day by day.”
He does note one liability. “The Web also brings down barriers to enter a market and mimic an offer. A print catalog is not that easy to start.”
Nevertheless he feels the benefits of not printing a catalog makes competing on the Web worthwhile. He likes the margins, and sees going entirely onto the Web in another 10 years.
“The three Ps: paper, printing, and postage -those costs aren’t absorbed on the Web,” Strum explains.
The Wine Enthusiast mails out some 15 million print catalogs a year. There are 120,000 12-month buyers.
While Strum calls The Wine Enthusiast a medium-sized catalog, he does allow it might be closer to large. “I guess it’s in the top 10% of catalogs in the country.”
The Web site is also used for wine auctions, to help build subscriptions to his 10-year old magazine, called, of course, The Wine Enthusiast, and wine and cigar clubs.
Strum claims the auctions-to close out wine seconds-are doing extremely well, and credits the Web site with helping convert the large number of complimentary subscriptions to the magazine to paid subscribers. The Wine Enthusiast, a monthly that comes out 14 times a year, has a paid subscriber base of 100,000.
The wine club, Wine Express, is still too new for Strum to tell how well its doing. As for the cigar club, he laughs ruefully. “Cigars turned out to be more of a fad than a trend.”
Despite the seeming synergy between fine wine and cigars, the results merit “just a free-standing catalog.”
But, as Strum notes, at least the consumption of wine is exploding. “It’s healthy. It’s associated with the good life. And it’s been part of the history of civilization for the past 7,000 years.”
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