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Southern Glazer\u2019s Wine & Spirits<\/strong> is one of the biggest names in the U.S. alcohol beverage industry, but as a distributor that sits between alcohol suppliers and the merchants that serve consumers, it has almost no direct contact with the end consumer. So how much can this essential but essentially invisible middleman do to advance an industry and improve the shopper\u2019s experience? Quite a lot, it turns out. \u00a0<\/p>\n \u201cBecause we have a very unique position as the middle tier \u2014 I consider us sort of the hub of a network \u2014 we have a total understanding of what the [alcohol] supplier\u2019s needs are<\/strong>, their goals, their marketing, when they\u2019re going to be pushing out advertisements, what products are coming, what inventory we have,\u201d said Alan Wizemann, Chief Digital Officer at Southern Glazer\u2019s Wine & Spirits in an interview with Retail TouchPoints<\/em>. \u201cAnd from a customer standpoint, because we have such a large share of shelf, we understand a tremendous amount of [the merchant\u2019s] business as well.<\/strong>\u201d<\/p>\n Now, Southern Glazer\u2019s is leveraging its place at the center of this equation to help digitize and improve the entire alcohol buying journey, using:<\/p>\n Even as digital commerce has rapidly evolved, the alcohol industry has been slow to modernize, in large part because of the multiple layers of players involved. Distributors like Southern are not legally allowed to sell to end consumers, making the product journey much less direct than in other categories<\/strong> \u2014 and that\u2019s before you bring in the newer fourth<\/strong> tier of delivery networks like Uber Eats<\/strong>. And all of this layering is further complicated by the alcohol category\u2019s intricate and complex regulatory environment<\/strong>.<\/p>\n \u201cIf you look at the 48<\/strong> U.S. markets that we\u2019re in, each market is like its own country<\/strong> \u2014 it has different regulations, different taxation, different assortments,\u201d said Wizemann. \u201cSo what we wanted to do as a sort of guiding principle on a lot of the things that we\u2019re creating for our customers [the alcohol merchants] is remove that complexity.\u201d<\/p>\n Simplifying this sector is critical for another reason: The shoppers buying wine and spirits are the same people who have become accustomed to sophisticated omnichannel experiences in other categories, so digital modernization is a must. Southern Glazer\u2019s massive digital transformation <\/strong>is aimed doing just this \u2014 bringing a consumer-grade digital experience to its suppliers and merchants<\/strong> that will help them in turn serve customers better.<\/p>\n Wizemann is the perfect man for the job. He has spent nearly his entire career building digital ecosystems for companies including Target<\/strong>, Lululemon<\/strong> and, more recently, major DTC brands such as Goop<\/strong>, Dollar Shave Club<\/strong>, Quip<\/strong> and Munchkin<\/strong>. While his new remit is very different, the expertise and philosophies Wizemann has honed in his 20+<\/strong> years at consumer-facing brands are very much applicable to what Southern is hoping to achieve.<\/p>\n \u201cA lot of the practices in the companies that I was at before just didn\u2019t exist, not only at Southern but also in the [alcohol] industry as a whole,\u201d Wizemann said. \u201cHow [this industry has] built technology in the past was very traditional, for lack of a better term, so Southern wanted someone who had done this before in a bunch of different industries to bring in that muscle and see what is possible here<\/strong>.<\/p>\n \u201cThus far it\u2019s been very successful,\u201d he added. \u201cWe\u2019ve been able to really push forward on not only our own [B2B] commerce experiences, but also a lot of the new proprietary technologies and tool sets that we\u2019re building for our sales force and for our merchant customers.<\/strong> [These technologies] bring what they\u2019re used to from other vendors that they deal with outside of beverage-alcohol into this industry.\u201d<\/p>\n A key role of Southern\u2019s sales force is keeping merchants abreast of new offerings, recommending products that will complement their existing assortment and help them stand out from the competition. Now, with the help of Southern\u2019s digital advancements and new AI-powered tools, that sales force has access to market and customer insights that can help them do that even better.<\/p>\n The development of solutions for this area of the business is aided by the fact that this particular task \u201cdoesn\u2019t carry the baggage of regulatory problems,\u201d said Wizemann, since it is an intermediary stage before any kind of sale happens. And the company\u2019s new AI tools are helping to ensure that both regulatory and inventory restrictions are considered<\/strong> before a recommendation is ever put in front of a sales associate. These limitations might include products \u201cthat can\u2019t be bought by certain customers because of their national accounts, or [items with] limited stock \u2014 for example, there\u2019s only so many bottles of a 40<\/strong>-year old Scotch hanging around.<\/p>\n \u201cThese aren\u2019t like the recommendations you see online from Amazon<\/strong>,\u201d Wizemann added. \u201c[They draw on a] deep understanding of the customer\u2019s business<\/strong> \u2014 their transactions, their menus, what\u2019s happening on their shelf both on and off premise. We orchestrate that story using artificial intelligence for our salespeople to give them powerful recommendations that are backed up with super-specific, personalized insights on that single customer location.<\/strong> It allows us to then be very, very good at saying, \u2018Hey, this is your next product.\u2019\u201d<\/p>\n Southern\u2019s deployment of AI for product recommendations highlights the company\u2019s larger philosophy around these kinds of new tools: \u201cOur sales force is our special sauce; no one knows their customers better and what\u2019s happening in their markets,\u201d said Wizemann. \u201cSo everything we\u2019re doing is done in a way that ensures the inclusion of our salespeople, rather than trying to push something onto them<\/strong> that, quite frankly, some people are scared of, and some people think is going to replace their job. That\u2019s something we never want to do.<\/p>\n \u201cWe\u2019re looking at driving efficiency by giving them more time,\u201d Wizemann added. \u201c[The tool might] have very good insights into their customers that they might not know, but then they can couple that with their local knowledge and understanding. For example, say the customer is a whiskey bar. [The technology] could identify 10<\/strong> whiskeys that we could say they should carry, but the sales rep might know that five<\/strong> of those 10 are really popular next door, so [the other] five<\/strong> will help you stand out.\u201d\u00a0<\/p>\n Placing this high value on the experience that humans bring to the equation also is a smart technology strategy, Wizemann added: \u201cIf you\u2019re losing the human touch and forgetting about who\u2019s actually benefiting from either the software or the experience, you\u2019re missing the mark<\/strong>. Every new technology that\u2019s ever come out always has a pendulum swing from the idea that the tech can do it all, and then slowly it comes back to, well, maybe it can\u2019t.\u201d<\/p>\n In addition to the product recommendation tools, Southern also has released a new ordering and account management website called <\/strong>Proof<\/strong> and is building out a market intelligence platform<\/strong> to help its merchant customers better understand and improve their business.<\/p>\n The goal of the market intelligence offering is to \u201cunderstand everything after a case leaves our truck,\u201d said Wizemann. This includes in-store data collection<\/strong>, where sales reps visit stores to track sales execution, including taking photos of displays, bottle placements and pricing. With the help of the company\u2019s new digital infrastructure, those store visits can now generate deep insights.<\/p>\n \u201cWe realized that we [collect store data] at such scale that we can actually learn from it,\u201d said Wizemann. \u201cSo we can analyze the images \u2014 what the price is on the shelf, how deep the shelf is, how wide, how many facings it has, what products are on it \u2014 and we\u2019re creating an incredibly smart system rooted in a lot of new AI products and models that allows us to analyze that. The goal over time is to be able to say, \u2018Hey supplier, you changed the price, this is what happened on the shelf,\u2019 so we can make much better recommendations to our suppliers around what their recommended prices should be.<\/strong>\u201d<\/p>\n The new website also has changed how and when Southern serves its customers. Most transactions are still completed through a sales rep, although approximately 18% to 20%<\/strong> of orders do now take place online, on average. (This number \u201cvaries wildly by state,\u201d according to Wizemann.) But when the new tools available to sales reps are taken into consideration, digital now touches around 70% of sales<\/strong>.<\/p>\n \u201cThere\u2019s no longer a scratch pad order form,\u201d said Wizemann. \u201cWe\u2019re digitizing our sales force, but also our B2B site. The goal is for all those tools to work together and be intertwined so they have the same information, the same recommendations, the same sales stories.<\/strong> That way there\u2019s a unified conversation that\u2019s happening between a customer and a salesperson. Because the salesperson interaction doesn\u2019t really last that long, probably 15 to 30<\/strong> minutes, and no salesperson in the world can talk about 15,000 to 20,000<\/strong> SKUs.<\/p>\n \u201cThere will always be the need for the relationship and the services that we provide through our direct sales force; what we want to move online is much more around discovery<\/strong>,\u201d he added. \u201cCustomers that do their reordering and discovery on the platform actually end up buying more. But the biggest benefit [of the website] is that it moves our relationship with our customers into a 24\/7 business. <\/strong>Think about it \u2014 it could be 9 at night or 2 in the morning when a nightclub or a bar manager or a hotel buyer finds the time to put their order together. They\u2019re not going to call their sales rep, but they can<\/em> hop onto Proof, put together their order and even create lists to talk with their salesperson about the next day.\u201d<\/p>\n And this is truly just the beginning. Wizemann sees ample opportunity for further integration between all tiers of the beverage-alcohol equation. Most exciting for him at the moment is the opportunity to better align suppliers\u2019 marketing efforts with that of merchants<\/strong>.<\/p>\n \u201cIf a big supplier is doing a St. Patrick\u2019s Day promotion, and they\u2019re pushing TV and social media and driving a lot of [interest], we can understand where that\u2019s happening and tell our customers that it\u2019s coming,\u201d Wizemann said. \u201cSo rather than having this disconnect of, [a bar owner] seeing a billboard and thinking, \u2018Oh no, I should probably order more of that liquor,\u2019 we\u2019re giving those insights ahead of time. The more connected we can get into the marketing side of our suppliers, the better decisions we can help our customers make.<\/strong>\u201d <\/p>\n However, all of these efforts are still driven by core ecommerce principles that Wizemann has picked up over the past two <\/strong>decades, the most important of which is that technology is the facilitator, not the solution<\/strong>: \u201cIn ecommerce, I think a lot of people still focus on technology as being the \u2018solve\u2019 for everything,\u201d he said. \u201cBut if you just look at the market for the past 10<\/strong> years, the technology has been commoditized with platforms like Shopify<\/strong> and others. Success now really boils down to the overall experience, on top of the products and the brands that are being carried.<\/strong> The ecommerce sites that are wildly successful today are those that are able to translate their brand, their product promise, into that experience, and can back it up with support.<\/strong>\u201d<\/p>\n<\/p><\/div>\n\n
Simplifying the Complex Alcohol Category<\/strong>
Bringing in Solutions and Expertise from the Larger Retail Industry<\/strong><\/h2>\n
Empowering Sales Reps with Data-Fueled Product Recommendations<\/strong><\/h2>\n
AI Designed to Aid, Not Replace<\/strong><\/h2>\n
Website and Market Intelligence Turn Southern into a 24\/7, 360-Degree Business<\/strong><\/h2>\n
A Connecting Point Between Supplier and Merchant for More Than Just Sales<\/strong><\/h2>\n