Building direct to consumer channels
15 June 2026
Hearing of UK sparkling wines winning international blind tasting awards alongside wines from Champagne has now become a fabled narrative.
The suitability and abundance of chalky, south facing slopes in the south of England, warmed by ideal growing season temperatures are like tailwinds propelling the production of sparkling wine beyond the imagination of early pioneers who were betting the farm by grubbing up Germanic still wine varieties in the early 1990s.
In fact, production of sparkling wine has been so successful that it has created a new problem; how to sell it all.
For some, the romantic notion of retiring from the city to run a vineyard and being able to take your own-labelled wine to dinner parties was enough of a trigger to shelve the problem of future wine sales. The issue comes around soon enough though and I have spoken to some wine producers who wake up in the night thinking about how they will sell their accumulating wine stock.
There is convenience in selling in bulk through the trade and wholesale channels, but unless your business is modelled to work at that scale, it will erode your P&L.
In a recent conversation with a client about this, he raised an interesting challenge. Yes, it is correct that selling wine by hand supports higher gross margins, but the cost of acquiring customers who visit the vineyard, upkeeping the facilities and paying utility bills and hospitality staff to fulfil those sales also rise, so unless you can manage these variable costs, or sell a sufficient volume of wine direct to the consumer to make those extra variable costs worthwhile, he didn’t accept that selling wine by hand was a panacea for wine businesses. The problem is, he is right.
This time it was my turn to wake up at night thinking about the solution. After much rumination, I have come up with five ways to either lower the cost of acquiring new customers or ensure there are enough direct-to-consumer sales to justify the increase in variable costs associated with selling wine by hand. These are set out below. Enjoy.
1. Rapid qualification of where your target demographic lives
In an ideal world, you would know precisely where your target demographic lives. If you knew that, then you would be able to stop wasting money on promotions and marketing in areas where people are unlikely to buy your wine due to financial constraints or lifestyle choices. Instead, imagine if you could identify postcodes where people with a pre-set minimum household income lived, who you knew enjoyed premium foods, dining out, leisure activities and had a greater appetite for supporting local businesses than the general population.
If you knew that, they you could also develop trade sales with bars, supermarkets, restaurants and hotels in those areas, so your brand had more penetration with that target demographic. You could also buy advertising in local magazines in those areas, and you could implement your signage strategy with more accuracy as you could map the main travel routes between your vineyard and those post codes.
We will be able to provide reports that are unique to each vineyard location, specifically so that wine producers can ensure they know they are talking to the right people. The data from the report will enable wine producers to be much more targeted in their communications, thus decreasing customer acquisition cost. If you would like to join the waiting list to order one of these reports, please contact me.
2. Host complementary businesses at your vineyard
In the early days of a business’s establishment and growth, the community that follows it tends to grow more quickly in percentage terms. New customers tend to place orders because their emotional connection with a new brand overrides cognitive barriers to spending. Over time, however, the incremental uplift in new customers created with each post or promotion reduces, and you begin to experience diminishing returns because many of your followers bought wine from you that they have not yet drunk and because the emotional connection you feel when you experience a new brand cannot be felt more than once, and secondary spending tends to be more discretionary. Customer acquisition cost therefore begins to increase.
The question is how you create that new brand excitement again and again. I am a big advocate for hosting complementary businesses in adjacent industries at your vineyard. My definition of complementary business is pretty broad. The key determining factors are whether they have similar clients to you and whether people buy their products and services with discretionary spending money. Under that definition, complementary businesses could range from record store owners to robotic lawnmower salesmen.
When the businesses promote their pop-up event at our vineyard to their followers, you piggyback off their network of customers and followers which materially reduces your cost of customer acquisition. Also, if done properly there will be enough people attending the events to adequately cover the increase in variable costs. As their customers engage with your business and enjoy the emotion of discovering a new brand it will also make it much easier to close new sales.
3. Collaborate with a transport, heritage and accommodation partner
Wine tourists are one of the most desirable target demographics as their average spend per head is so high. The barrier to entry for many wine tourists is whether there is accommodation nearby or on site, and what else to do in the area if they want to make a weekend of it. If you put that work on the customer, it adds too much friction to the customer journey and means there is a lower likelihood of wine tourists visiting your vineyard.
Far better is if you collaborate with a nearby boutique hotel, a chauffeur taxi service and a local heritage or culture attraction, who each contribute to the cost of promoting the package. This way you can offer wine tourists a tailored experience where they are met at the airport, driven directly to the vineyard for a tour, tasting and maybe dinner, before they are driven to their hotel and then onto the attraction the next day.
The collaboration also allows for there to be lots of touchpoints throughout the experience for them to buy your wine, and not just at your cellar door. For instance, the daily itinerary, hotel room welcome pack or restaurant menu could all have a QR code which they can scan to buy a of case your wine.
4. E-commerce sales embedded in video content
Video has always been a far more effective way to engage potential customers than text or image content. Videos bring products to life and give viewers a real feel for what they are considering purchasing. Furthermore, video content can help deliver authenticity by showcasing testimonials or behind-the-scenes footage, which builds trust between brands and customers.
Historically, the problems with video were that there is no way of measuring what made the video effective, other than some viewers’ comments, so optimising future video content was difficult as they had no data to go on. The other problem was that once the video ended, there is a very low conversion rate from those who watched the video to those who went on to buy the product or service.
Calls to action, polls and other features can also be embedded in the videos, so that useful data can be harvested to inform future content strategies.
The sales generated from e-commerce embedded video go via the direct-to-consumer channel. There is either a commission or service fee payable to the platform host, and there is the up-front cost of making the content, but other than these costs, the only other fulfilment costs are packaging. There are some very exciting British start-up ecommerce business looking to expand out of their core sectors into the UK wine sector, because they see how impactful the passion, joy and pride derived from making and enjoying sparkling wine will be in a video format.
Any online sales of alcohol must comply with the Licencing Act of 2003, and vendors must have both a premises and personal licence to sell alcohol.
5. Membership
There are lots of different financial models for membership schemes. Some are discount-led, where members pay a premium to enjoy future wine sales at a discount. James Osborn, who is sadly no longer with us (he’s not dead, he moved to take on the MD role at Hambledon) said this model was too transactional for his liking, and you have no way of predicting when the sales may come in. The best example of membership I have come across is at Squerryes Wine Estate, which James created with Henry Warde, the estate owner, where membership is about creating a closer relationship with the brand through member events, dinners and private tastings, and the only financial commitment is to buy two 6-bottle cases each year by direct debit.
The membership list stands at over 2,500, and there is a 92% retention rate. It creates annuity income at a direct-to-consumer membership price with the only fulfilment cost being packaging. This supports a weighted average sale price (across all channels) of over £30 per bottle, which is astounding.
Part of their success has been knowing when, during the customer journey, to sell the membership package. They take the details of the customers on arrival, ensure they are given a seat on the terrace overlooking the vineyard, so they have a wonderful first experience. They then wait until the day after the visit to ring them and thank them for coming, and only then ask them if they would like to become a member. This is such an impactful strategy, because the ‘sell’ took place during their visit, so the rubber band holding their wallet together is already ready to snap by the time you ask them if they would like to become a member.
Conclusion
My worry for some UK wine producers is that having exited from a very successful business, they now want to enjoy their wine estate. Unfortunately, you can’t press pause on nature and with each harvest comes a commitment to either sell the grapes or bottle the juice. If you are coming into the sector from the city and build a business around the sale of grapes, you will probably not have the know-how enjoyed by generational top fruit farmers and will find cost of production creeps up, and you are suddenly in a marginal business. If you decide to bottle the juice, you realise quite quickly that you are in the business of hospitality, which is immersive, passionate, kinetic, and exhausting. By that point, it generally hits that having left one business you have entered another one that is harder work and doesn’t pay as well. I hope that the five points above serve you well if you are having this realisation right now.
