Heard Through the Grapevine: Lessons from Wine.com’s Performance Marketing Success

Sustaining a leadership position in a competitive online marketplace can be a challenge, especially with new entrants, fickle customers and diverse sales channels entering into the picture. There are, of course, a wide range of marketing channels to choose from and marketing managers need to use their budgets wisely. One example of a company that’s a good steward of its budget is Wine.com (a LinkShare client).

Wine.com is a San Francisco-based company with roots going back to early days of ecommerce. With many years of success, the Wine.com team offers lessons that any online retailer needs to know.

Here are three of the most important elements for success in the affiliate channel:

1. Create opportunities for publishers.
2. Support popular, emerging platforms and sites.
3. Complement your affiliate efforts with a compelling promotional strategy.

Create Opportunities For Publishers

Affiliate marketing is a great channel for online wine sales as well as other food items because it plays into consumer behavior.

More specifically, a December 2011 Forrester Research study proved that shoppers often check multiple sites for the best deals before they make a purchase. But consumers are not only looking for the best price, they’re also comparing product reviews and customer feedback — this is where the affiliate channel plays a big role.

In these instances, the publisher is usually operating one of the sites consumers are visiting in search of pre-purchase information. In those instances where the shopper is not familiar with the online retailer or didn’t go directly to their site, the role of the publisher becomes even more vital in the sales process.

When online retailers create new opportunities for publishers, consumers get the best deals, publishers earn commissions, and online retailers make the sale while also getting on the radar of customers that may not have been aware of them previously. Given what we know about consumer behavior, it behooves the online retailer to closely align with publishers and provide them with fresh and compelling ads and worthy commissions.

Now you may be wondering what the opportunities are for publishers regarding online alcohol sales — it’s a question that Wine.com is often asked. While some states don’t allow alcohol to be shipped from an online purchase, Wine.com serves 92 percent of the U.S. population.

With this in mind, it’s also important to note that the company doesn’t just sell wine. They also sell gift baskets, gourmet chocolates, wine glasses, gift certificates, and accessories to the entire United States. These products represent a significant portion of their online revenue resulting in increased opportunities for publishers.

For example, through its partnership with Savings.com, Wine.com participated in Black Friday deals, holiday blog posts and social networking giveaways driving sales outside of the usual shopping category listing.

“We continue to invest in the affiliate channel because it enables us to drive revenue, uncover new customers and expand our reach,” said Wine.com Director of Marketing Christine Fabi. “Year over year, we continue to see double-digit growth through performance marketing.”

Support Popular, Emerging Platforms And Sites

Many advertisers across product categories are seeing a shift in traffic and conversion from desktop to mobile and tablets and are investing resources to take advantage of these new technologies. Not surprisingly, m-commerce growth is expected to rise.  Coda Research Consultancy predicts that online sales by mobile devices will rapidly increase by 2015, reaching $24 billion.

Meanwhile, publishers that want to succeed in the mobile space need to consider the consumer experience. This begins with the publisher site that helps direct traffic to where the sale is made. Any hiccups in the process can jeopardize the sale. Publishers who understand the importance of the mobile customer experience will be reaping more commissions as mobile hits its stride.

In 2011, Wine.com reported that more than seven percent of its second quarter revenue was from Apple iPads, and that number is expected to grow significantly.

“We anticipate exponential growth through the mobile and tablet commerce channels in 2012,” continued Fabi. “This will come from consumers becoming more comfortable shopping on mobile and tablet devices as well as from affiliates that have created mobile applications.”

Complement Your Affiliate Efforts With A Compelling Promotional Strategy

Promotional strategy is also critical to the success of an affiliate marketing program. You may want to consider Wine.com’s highly effective one-cent shipping offer.

Additionally, this past holiday season Wine.com partnered with Cartera Commerce, widely known for powering many of the airline loyalty sites. The promotional strategy was rooted in mileage reward programs combined with customer promotions. Together, they were able to more effectively reach their target audiences to drive sales, deliver higher average order volume and boost customer loyalty.

“Establishing a solid performance marketing strategy comes down to the retailer’s ability to be flexible, ahead of emerging trends like mobile and tablet commerce, and simply make it worthwhile for the publishers,” said Fabi. “Without those elements in place, the most compelling offers won’t effectively reach your customers or enable you to make the most of your efforts in the affiliate channel.”

Cheers to that!