Key Metrics Every Winery Needs To Track
Goals are hard to achieve if not being tracked. The fastest way to inspire change in your winery ecommerce, direct to consumer, or wine club business is to rally the team around clear goals and measure them regularly along the way. At vinSUITE, our motto is “Know more. Sell more.” which is why our winery software was built with powerful data collection and analysis tools. Although the ways in which the information from our software solutions can be sliced and diced are endless, if you are looking for a simplified place to start your analysis, we have a few ideas.
But first, we have to remind you that consistency is key when doing any kind of ongoing reporting. Decide how you are going to track a metric and stick to it so that when you look back and compare month-over-month or year-over-year numbers, you’re comparing grapes to grapes.
eCommerce and Point of Sale Software Reporting
1. RFM Analysis
RFM stands for Recency, Frequency, Monetary. It’s a way to segment your direct to consumer customer base and decide how to most effectively spend your marketing dollars. Recency is the most important predictor of who is more likely to respond to an offer. A recent purchaser is likely to purchase again in comparison to someone who hasn’t bought anything for quite a while. Frequency is the second most important factor. The higher the frequency, the more likely they are to respond to your marketing efforts. Monetary totals up how much each customer has spent. Following the trend (and common sense), those who have spent more are more likely to spend again. Using winery ecommerce software like vinSUITE makes pulling these numbers a breeze.
To employ the RFM segmentation, each category is broken into five levels and assigned a number. A customer, who, for example, has purchased in the last month, would get an R score of five. One who purchased in the last 1-3 months would have a score of four, and so on. The same tactic is applied to frequency and monetary as well. Higher scores mean higher frequency and spend. In the end you can see who your strongest DTC target market is and decide how to spend your marketing dollars speaking to them.
2. Net Promotor Score
This metric is very simple and most powerful when used over time. It is an indicator of customer satisfaction. The easiest way to gather this data is to send a very simple survey to people as a trigger email after a visit to the tasting room, just asking them on a scale of 1 to 10 how likely they are to recommend the winery to a friend. Leave them a box for comments and that’s it! However, a good rule of thumb is to follow up with a phone call for a score of 6 or under. These scores can be measured as often as you’d like and used for decision making, incentives, and training tools. The CRM in our ecommerce software makes it easy to set trigger emails such as these, add notes to customer profiles, and follow up quickly so you can provide the kind of service that makes your customers want to stay your customers.
3. Value of an Email Address
We all know collecting customer emails is important, but do you have any idea how much each email address is worth to your business? Don’t worry if not. It turns out, lots of people don’t. However, it’s a good number to have, especially if you are trying to build your direct to consumer list and you’d like to incentivize your tasting room staff to collect more of them. The simplified version of the calculation is just adding up all the revenue from email sales and dividing it by the functional email addresses on your list. You can either decide the revenue number comes from the amount of online sales made the same day (or two) after the email went out, or you can calculate the conversion of click-throughs and use that if you want to try and be even more precise. Whichever method you choose, don’t forget to use the same one every time! Since vinSUITE’s software is fully integrated and simple to use, pulling ecommerce sales numbers and tracking email addresses only takes minutes. Plus, we’ve designed our CRM so gathering customer information is quick and easy.
Wine Club Management Software Reporting
1. Conversion Rate of Tastings to Wine Club Signups
This is a metric that is always fun to track. You can look at it wide, or narrow it by club, tasting level, tasting room staff member, day of the week, months, etc. It’s a simple computation of number of tastings divided by number of club signups. Wouldn’t you like to know the percentage of people who actually join your club? Or to learn which tasting level leads to which club membership? Whether you’re using our desktop or tablet POS software at your winery, we make these figures easy to pull and easy to compute. After all, the more you know, the more you can sell.
2. Lifetime Value of a Club Member
Given how important wine clubs are to most wineries’ businesses, a lot of people know this one. If you don’t, it’s time. First, you’ll have to figure out the average length of time a club member stays active, then how much they spend. Divide. You’re done.
3. Wine Club Attrition Rate
No one likes to focus on the negative, but knowing a wine club’s attrition rate is also important. How many new signups do you need to keep the wine club steady or growing? If you have multiple club levels, do they have varying attrition rates? What can you do about that? Does one of your employees sign up more short term members than the others? There’s much to be explored in this metric and depending on your outcome, there could be a lot of opportunity to improve your bottom line. vinSUITE’s robust reporting capabilities within the wine club management software allow you to use canned reports or create your own so no matter how complex your club structure gets, you can easily get the insights you need.
If you want to know other ways you can view your data, we’d be happy to help current customers maximize vinSUITE’s reporting capabilities, or give prospective customers a demo of how the software can help you to know more so you can sell more wine.