Name-Your-Price Wine Boosts Loyalty and Sales
Tired of paying too much for mediocre wine? Now one South African producer asks you to pay what you think it is worth. The tactic seems to be working. He is simultaneously strengthening his customer base while boosting sales. Check out this bit from the May 22 SpringWise:
What works for alternative rock music, might also work for wine. You may remember how Radiohead got the world's attention when it let listeners download its album In Rainbows, asking them to pay whatever price they thought the music was worth. Sales of the album reached USD 10 million. Since then others have tried the pay-what-you-like marketing technique, including Paste magazine, which we featured in October.
South African BLANKbottle has gone a step further. The boutique winemaker's founder, Pieter Walser, sent 20 cases of its latest premium white wine Moment of Silence to loyal customers on consignment, asking them to evaluate the wine and then pay him what they thought it was worth. They paid up to ZAR 90 per bottle (USD 11.80 / EUR 7.50), and the average price came to ZAR 50. Since BLANKbottle aims to exceed customers' quality vs. price expectations, the wine went on sale to the public at a price of ZAR 40.
Walser, for his part, got a high return on the wine he risked in the venture. In addition to the publicity he garnered, he determined a new product's price point based on the actual purchasing decisions made by the winery's best customers. Feedback that's likely to be more valuable than the opinions volunteered by focus groups or market research experts. And by involving them in such a fundamental business decision, he no doubt increased brand loyalty among the winery's core customer base. One to try out with your own best customers! (Spotted by: Bruce Gourley)
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Posted by Noël Wallace at May 24, 2008 9:00 AM