The impatient, disloyal customer

A study shows that customers tend to switch brands quickly once they were unable to purchase a product. What does this mean for the wine industry? Robert Joseph shares his thoughts.

Credit: Monster Ztudio - stock.adobe.com
Credit: Monster Ztudio - stock.adobe.com

The US super-investor Warren Buffet memorably said that financial crashes are like the sea going out and revealing how many bathers aren’t wearing swimming costumes.

The global supply chain crisis is having similar impact on consumer loyalty to brands and suppliers. Thanks largely to Amazon’s near-global introduction of next-day and same-day delivery, people who were once more or less happy to wait 28 days to get anything they didn’t carry home from the shop, are now as patient as the average toddler or puppy. They want what they want now.

McKinsey recently asked 2,100 US adults whether they had been unable to make a purchase over the previous three months. Then, when 63 percent replied in the affirmative, these respondents were asked how they had reacted on the most recent occasion this had happened.

Thirty-nine percent said they had switched brands or product, while another 32 percent had switched retailer. Sixteen percent simply cancelled the purchase and a mere 13 percent had been prepared to be patient.

 

 

These figures are especially relevant to the wine industry where brands and brand-loyalty are notoriously weak.

I’m sure that many fans of top Burgundies, Brunellos and Bordeaux may fit into that 13 percent, and there will be some who’d wait for delivery of their favourite natural wine from the Jura or Slovenia. But these are the exceptions.

As Miles Beale, head of the UK Wine & Spirit Trade Association, told the BBC, British consumers will be seeing more limited ranges and unfamiliar labels on supermarket shelves, this Christmas, as retailers have moved to solve their supply problems. And this will almost certainly be the case elsewhere. Once people have tried alternatives to their regular wines, and found them satisfactory, will they all loyally switch back? I doubt it.

The first and most obvious lesson is that producers and distributors need to change their shipping schedules. Gavin Quinney of Chateau Bauduc in Bordeaux, who sells directly to customers in the UK, was loading his wine onto the trucks six weeks earlier than usual, to be sure of it getting to them in time for Christmas.

But logistics is not the only skill that is going to need to be deployed.

These are financially tough times for many, and are likely to become tougher in the new year as inflation begins to bite. The temptation to cut marketing budgets will be almost irresistible, but it should be resisted with all the muscle available.

Now is the time to do everything you can to build relationships with customers that transcend delays in delivery and, quite possibly in the case of many European producers after the 2021 harvest, the total inability to supply the wines they have grown to enjoy.

In other words, buy your swimming costume before going into the water, because there aren’t any shops selling them once you’ve left the beach.
 

Robert Joseph

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