For online retailers of wine, there can be too much of a good thing when it comes to the size of the assortment. The sweet spot for maximizing wine sales online is in the range of 1,500 to 2,000 items, according to research from Bottlenose, an e-commerce platform vendor that specializes in setting up, hosting and managing online stores for wine and spirits retailers.
Bottlenose tracked online sales in November and December by 25 wine retailers on its platform, with the study population including five retailers each with the following online assortment sizes: fewer than 500 items; 500 – 1,000 items; 1,000 – 1,500 items; 1,500 – 2,000 items and more than 2,000 items.
Retailers who posted for sale 1,000 to 1,500 items had the most success, with sales averaging $142,035, compared to $84,642 for the greater than 2,000 items group. Retailers in the 1,000 – 1,500 item group averaged just under $75,000 in sales; both the 500 to 1,000 item group and the fewer than 500 item group averaged well under $20,000.
Howard Morrison, head of sales and marketing at Bottlenose, says the data show that having more items on a wine site is not necessarily better. Morrison, who notes that all of the online retailers in the most successful group also have bricks-and-mortar stores stocked with more than 4,000 items, adds that online wine sellers who also have offline stores often ask whether they should list every item online that they have in-store.
Wines listed for sale by an online retailer should be attached to ratings or review information, product descriptions and any other information available about the wine, a process that requires gathering information from wine producers, wholesalers, reviewers and “scouring the Internet” for information, Morrison says. That makes it difficult to manage successfully a very large assortment. By doing the research and adding the copy to facilitate search engine marketing, “You’re going to get found more often with a smaller number than someone who just slaps up 8,000 items,” he says.
Morrison says that out-of-state shipments constitute the larger share of online orders for most of the 15 wine retailers surveyed on this question, with only two reporting that out-of-state shipments represented less than 60% of their online sales. In-state shipments are higher for retailers with more local shipping and delivery options and for those that publicize online their in-store wine-tasting events.
A query of 15 Bottlenose retailers found that though the months of November and December each represented approximately 15% of the year’s online sales, online sales in the month with the lowest sales volume, June, still represented about 6% of the year’s sales.
“E-commerce web sites are becoming a necessity,” Morrison says. “Consumers are shopping 365 days a year. Sales come from all over the country. With an e-commerce site, retailers put themselves in a position to go forward to find new outlets for making sales on inventory that is not moving locally.”