Your Sommelier is an online wine merchant offering Monthly Subscription Boxes of French Wine
Business overview
| Location | London, United Kingdom |
|---|---|
| Social media | |
| Website | www.yoursommelier.co.uk |
| Sectors | Food & Beverage Digital B2C |
| Company number | 8255509 |
| Incorporation date | 16 Oct 2012 |
Idea
Introduction
Your Sommelier is an online wine merchant focusing on authentic and independent French vineyards. We started trading 3 years ago with a unique concept: offering our members one producer every week. Membership is 100% free and gives access to these weekly offers.
We import our wines directly from France, specialising in the discovery of small family-run estates making great value wines. We have developed solid partnerships with producers and keep looking for new wines every day.
In order to broaden our customer base, we have recently launched a subscription box of 3 bottles per month. Our box includes detailed tasting notes, information on the wine region and winemaking techniques. The idea is simple: educate people about French wine in an affordable way, and give the possibility to taste different wines before ordering a case. Subscribers have the ability to re-order wines they liked at a palatable 20% discount. Your Sommelier's box is also available on a fixed-term basis for gifts.
* PERKS *
All investors will benefit form a 10% discount on all purchase on the website for 1 year.
In addition, we are pleased to offer the following benefits:
Investments of £2,000 - £4,999: Amateur Gift Box 1 month
£5,000 - £7,999: Amateur Gift Box 3 months
£8,000+: Amateur Gift Box 6 months
Additional terms and conditions may apply to any rewards offered. Please contact the company to find out more and ensure you qualify.
Intended impact
Try new wines before ordering a case!
We have observed that many customers are reluctant to buy wine online if they have not tried it before - and ordering a single bottle is usually more expensive than buying in bulk. Our subscribers receive 3 different bottles of French wine on a monthly basis around a specific theme (a region, a grape, an experience...) from £36. They are then able to re-order the wines they like, at a 20% discount with free delivery over £100.
Your Sommelier aims at a double impact:
- Provide a proper education about French wine, regions, grapes, tasting techniques, with our A5 cards, regrouped in our special binder.
- Encourage our subscribers to use Your Sommelier when ordering wine, as they can choose something they have already tried – a very reassuring concept when it comes to choosing wine. We believe the 20% discount subscribers benefit from is also a great incentive.
Substantial accomplishments to date
- Your Sommelier started trading 3 years ago. We have built a solid and loyal customer base with 150+ returning buyers and 1,000+ members - all with limited marketing means and a lot of word of mouth referrals.
- We have also developed strong relationships with a number of French producers. As a result, we are able to source wines at competitive prices - and for some, we believe we are the only retailer to offer them in the UK.
- Our new subscription box business is up-and-running, along with a new website we have recently launched.
- Our operations and logistics are established: Your Sommelier is a registered wine importer working directly with producers, therefore keeping costs down. We work with various transporters to move wine around, cutting out any middleman in the process.
- Each box sold includes a positive gross margin and Your Sommelier is already operationally profitable* (for the year ended 31 October 2016).
As Your Sommelier grows we expect our marginal costs to decrease over time, transport and wine purchase price generally becoming cheaper with higher volumes.
*Based on unaudited management accounts.
Monetisation strategy
We plan our revenues through multiple streams:
- Monthly subscriptions should drive the bulk of revenue growth. Each subscriber generates a minimum of £36 per month (for the "Amateur" box), or £432 per year, of fairly predictable revenues.
- Fixed term gift subscriptions may also be significant, as we intend to be especially active on the marketing front around key dates (Christmas, Father's day...).
- We also expect additional revenues from subscribers re-ordering wines they liked. We believe the 20% discount is a strong argument for them to buy from Your Sommelier, as well as a key argument for new subscribers.
- We intend to maintain our weekly private offer business. As box subscribers get more knowledgeable about French wine, we expect some of them to start buying wine more regularly.
Use of proceeds
We intend to use 80% of the proceeds for the marketing campaign of the subscription box, with a double focus: Client acquisition and Client retention.
Client acquisition will be based on 3 pillars:
1 - Digital Marketing: Paid Search (Google & Bing), social networks and re-targeting.
2 - Press Campaign: outsourced via a PR agency specialised in wine & food.
3 - Marketing events, wine fairs, leaflets and affiliation programmes.
We aim to organise client retention around:
1 - Active community management to keep our members involved, feeding them with wine news, tips and various information.
2 - Active CRM management with targeted wine suggestions and regular vouchers to create incentives. We also intend to use the client base to push our referral programme and acquire new customers.
The remaining 20% should be split among:
- Salaries.
- Office rent.
- Development of IOS and Android apps.
The company has director's loan of £32,537 (interest free). Funds raised will not be used to repay the loan.
Market
Target market
"I wish I knew more about French wine..." Who has never heard this sentence before?
Your Sommelier's target market is the UK mid-range wine retail market. We believe French wine has always been and remains overwhelmingly attractive to wine drinkers, who are eager to discover producers and appellations they do not know. They are also looking to learn about grapes, regions, tasting techniques and more.
There is also a second - and overlapping - market we are after: Subscription boxes, which are increasingly becoming a market on their own. They are convenient for busy consumers and a lot of commercial successes have been built. For us, this target market includes especially wine consumers who do not have the time or knowledge to choose wine, who like to taste different bottles and have the opportunity to buy only what they really like.
New clients may subscribe to our box for different reasons:
- Receive and discover new wines regularly, without having to choose them in a list of hundreds of bottles.
- Learn about French wine, grapes, regions, appellations and winemaking techniques with our friendly tasting cards.
- Taste a number of different wines and re-order them at a 20% discount to the public price.
- Offer a gift to friends & family - giving us a share of the "What could I get for his/her birthday present" market.
- Learn how to taste a wine.
Characteristics of target market
Wine is a large £11bn business in the UK (Wine and Spirit Trade Association, 2016). Total wine volumes in retail are down 3.5% since 2011, as people tend to consume less quantity. The trend is however a better consumption: consumers are willing to pay more for interesting wines - we believe this is exactly what we do: we are specialised in the mid-range area.
- UK wine industry is worth £5.3bn to retailers. 11% of these sales are done online and this proportion is expected to grow up to 18% over the next 3 years.
- French wines have a whopping 30% market share online, by far the biggest country, while it is in third position offline.
This reflects the importance of the online channel when it comes to French wine.
- Wine education is booming in the UK: WSET (Wine and Spirit Education Trust), the leader in wine qualifications and education courses, experienced a 14% increase in the number of students taking its exams in the UK during the 15/16 academic year. Globally, the number of candidates has been continuously rising for the past 14 years.
As per many sectors, the online share of the market is growing rapidly as people change habits. We have observed that consumers also seek alternative ways of drinking wine, focusing on knowledge and new discoveries.
We believe subscription boxes are not just fashionable, they have become a real way of consuming. Everyone knows Hellofresh, Gousto, Graze, My Little Box... but could you name one for wine? To our knowledge, although competition exists, no one has managed to become a dominant player and a reference for wine subscription - just yet. This is our objective.
Marketing strategy
* Digital marketing.
Our objective is to have a continuous digital marketing strategy to drive web traffic and sales, via different channels:
- Google Adwords - focused on subscription boxes, wine education, French wine and gift ideas.
- Paid social - mainly via Facebook with attracting posts & videos.
- Building a community through social media (Facebook, Instagram, Twitter, LinkedIn).
- Retargeting - including cross-media and cross-device.
* Press Campaigns.
Through our contacts and the services from a PR agency, we started to contact a wide range of media (specialised national and local newspapers, lifestyle blogs) to introduce our subscription box. Samples are being sent to multiple journalists and some articles are already out. We are also preparing a wider campaign, and we intend to repeat this on a regular basis - especially around special dates like Christmas.
* Wine fairs
We attend a couple of customer-focused wine fairs every year to communicate and meet potential new customers, who can discover our wines and discuss with us.
* CRM - and careful wine selection.
This is an important part of the marketing strategy, as keeping clients happy and engaged is key. Quality of wines, original themes in our tasting box, vouchers... The objective is to have a solid client retention rate - which we intend to monitor and improve continuously.
We also have today several hundreds of inactive members. Through a targeted CRM campaign, some of them have already subscribed to our box and we expect more to come in.
* Leaflet distribution.
This sounds archaic but to our knowledge it remains a very efficient and cost-effective way of acquiring new clients – they are delivered via mailbox and on-street marketing operations.
* Word of mouth and referral program.
Also an important element of our marketing strategy, we intend to introduce a free tasting box for each new subscriber referred, as well as referral vouchers for our Private Offers clients.
Competition strategy
Subscription boxes are booming in the UK in many areas - food, health, fashion... Several players exist in the wine business but to our knowledge no one has yet managed to become the "Hellofresh" of the "Birchbox" for wine subscriptions. This is what we aim to be!
We intend to concentrate on the following 4 pillars:
* Offering a 20% discount to re-order wine
We want this discount to be one of the main arguments to subscribe and create a habit of ordering with Your Sommelier. We expect 20% to be substantial enough for our subscribers to buy from us regularly.
* An unmatched wine selection
This is key to our business model. As several competitors tend to deliver lower quality wines, we strive in finding bottles with amazing value for money. Moreover, offering 3 bottles per months (vs 2 for most competitors) should allow us to reduce external costs per bottle (delivery, boxes...), hence giving us a higher purchase price per bottle for a given margin.
* Emphasis on education
As wine consumers are increasingly looking to educate themselves about wine, we want to provide as much as possible with detailed tasting and information cards and a binder to keep them. To our knowledge, we are the only 100% French wine player.
* A friendly user experience
We believe our offer to be simple and clear, the subscription only takes a few clicks and is very straightforward to manage on the website.
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