It was more than 15 years ago that the first order was placed online at BevNetwork.com. That was back in the heady days of the dot com bubble and online ordering in the liquor industry was maybe a little ahead of its time. Back then it didn’t seem unusual that stores were being paid to place their orders online, needless to say that didn’t last long, nor did Beverage Media’s brush with venture capitalists. However, ordering on BevNetwork.com has since become a familiar feature of the trade in the Northeast as the millionth order was facilitated just last month.
Ordering online started slow but has been picking up in recent years. In the last 3 years there were almost half a million orders, and at the current rate of growth order number 2 million will be placed in only 3 more years, sometime in 2016. This year we expect almost $250 million in orders to go through the website by both stores (off-premise) and restaurants (on-premise). This will represent more than 150,000 orders, many of which are being delivered electronically to the respective wholesalers.
Use of the BevNetwork site is split pretty evenly between on-premise and off-premise licensees. However the ordering is less balanced, with off-premise stores placing twice as many orders online as restaurants. Online ordering favors the reordering of inventory that is already known, off-premise stores take advantage of filters and sorting features to find discounts that ensure they buy at the correct price. Restaurants that have a predefined wine list can easily reorder online, but if replacing a spot on a list requires tasting a sample, then a sales rep will probably take that order.
Sales reps are also now a part of this online activity as the Cellar on BevNetwork includes marketing tools that help sales reps engage their accounts online. Reps are also notified when orders are placed online so they can follow up if an order needs to be changed before the order board closes.
New markets will be coming online soon, but without the price posting laws of the Northeast that ensure everyone has access to the same discount levels it will be interesting to see how many markets adopt online ordering. A wholesaler in one of these new markets commented that he was jealous to see how easily orders are placed online in NY, NJ and CT. He thought the pricing structures in his market were too complicated for this to work, but was open-minded to the possibility that it could work for his company.
These days licensees don’t need a financial incentive to place an order online, the value of eCommerce has been well established not just for personal but also business applications.