If you’re not charging a commission on wine sales, how does Sommly make money? #
Sommly uses a subscription model for the platform’s digital marketing and marketplace services. Wineries will have access to many benefits and features for free, and will have the option to upgrade to a paid tier of subscription to list products for sale (i.e. individual wine bottles, wine bundles, and merchandise). This monthly subscription starts at $29/month (for up to $1000 in wine sales/month), and there’s a discount for wineries that opt in to annual rather than monthly subscription. Wineries with over $1000 in monthly sales will automatically move to the next tier, which starts at $125/month.
The low monthly subscription fees seem too good to be true. What gives? #
We have been getting feedback that these low prices make it sound like there’s a catch. There’s not a catch, it’s simply economies of scale that allow us to provide these services affordably. If you would like to pay more, we would be happy to let you do that 😉
Additionally, we are anticipating ad revenue from related services such as wine country restaurants, lodging and hospitality, transportation/tour companies, etc. who may choose to advertise with Sommly.
How does Sommly fit into my existing DTC landscape? #
The short answer is, it depends. Generally, we recommend winery teams continue to leverage the systems and processes you currently have in place, such as your website’s e-Commerce, any compliance or shipping/fulfillment partnerships, etc. Proceeds from each sale you make on Sommly will automatically go directly to your bank account, which will be connected via Stripe. You have a few options about how you want to manage compliance, shipping, and the like. Let us know if you have any questions about how order info can be sent to another system or company. Since the transaction takes place in Sommly, there’s not a requirement to send it through your website’s e-Commerce platform – as that could cause you to incur additional fees from them than necessary.
How much does shipping cost consumers when they buy through Sommly? #
That is for you to decide! Each winery will have the ability to set shipping rates, bundle discounts, etc. Generally Sommly recommends flat rate shipping, and bundles/shipping discounts to encourage consumers to add multiple bottles to their cart, so the cost per bottle is lower.
What if a customer has wine from multiple wineries in their cart? #
Similar to Etsy, they will check out multiple times because it’s from multiple vendors. In the future we may invest in automating this so it’s a single button to check-out, but then the payments are sent to multiple wineries. Since the shipping will be unique for each winery, we did not feel it was necessary to have this included as part of the soft-launch because it may confuse consumers to incur multiple shipping charges under a single checkout.
What if I only want to ship to Texas? #
Wineries will indicate which states they ship to as part of onboarding. For example, if I only ship to Texas, I will select Texas only as part of the onboarding on my winery’s page. This can be changed in the future if you get new permits or enter into shipping/fulfillment partnerships that extend your reach. If a consumer tries to add a bottle to their cart that cannot be shipped to their address, they’ll get a notification indicating that.
How does Sommly plan to attract consumers to the digital marketplace? #
Sommly will maintain a strong presence on multiple marketing channels. For instance:
- Search Engine Optimization (SEO) – Sommly will have a significant amount of search engine friendly content that will be published and updated regularly. Each individual page, whether it is a winery, wine bottle, author, blog, etc will be optimized to maximize the site’s searchability.
- Social Media – We will leverage social media marketing and targeting strategies to get Sommly in front of wine enthusiasts and occasional wine drinkers alike.
- Affiliate & Influencer Marketing – Affiliate marketing strategies are being deployed, and we will leverage referrals and gamification to drive new user growth both initially and longer term. Sommly will build relationships with influencers who will be compensated to send traffic to Sommly via affiliate links.
- Paid Media – Social advertising on Instagram, Facebook, Twitter and others will be leveraged to encourage wine lovers to visit the Sommly website.
- Podcasts – To advertise to build brand awareness within the wine consumer community.
- Public Relations – Sommly will build a strong public relations playbook and relationships with authors who publish content about the wine industry.
- Field Marketing – We’ll offer promotions to consumers who use a QR code to create an account while at a winery, and leave a review of their experience in real time.
- Event Marketing – Sommly will maintain a presence at wine consumer focused events to build brand awareness.
What if there are multiple people on my team that need to manage my winery page, my digital bottle shop, orders, etc.? #
Not a problem. Eventually, each person just needs to create an account, claim the winery, and get approved as an appropriate winery administrator by Sommly. In the short-term, winery admin rights can only be approved for 1 account. Note that while multiple users can have access to manage the winery site, a given email address can only be the admin of one site. If you will be managing multiple sites, you will need to use multiple email addresses (one for each winery).
How do I connect my bank account via Stripe? #
You will connect your business bank account to Sommly as part of onboarding, to receive direct fund transfers when orders are placed through the Sommly marketplace. If you already have an account with Stripe, you’ll simply need to connect it to the Sommly platform and answer a few prompts to certify. If you do not have one already, please first create an account at https://dashboard.stripe.com/register. You will be asked to fill out a form upon registration, and provide some documentation, when you initially create your winery’s Stripe account. The questions will appear in your Stripe dashboard mostly in the form of Yes/No. See below guidance to support that process, and you may also reach out to Sommly or Stripe support if you get stuck.
Be prepared to submit the following.
1. A copy of your liquor license, or a link to where this information is available online.
2. A signed copy of your alcohol shipping agreement (e.g., FedEx, UPS, or Canada Post). Make sure this agreement covers direct consumers and the types of alcohol you’re shipping. For example, if you are shipping wine, the agreement should explicitly state that it covers wine shipments. If your out-of-state shipping is via shipping/fulfillment partnerships (e.g. WineCub) please note that.
3. When connecting Stripe to Sommly, Stripe will ask for a brief description of the payment flow, “What are you selling on Stripe, and how are you billing customers? Please feel free to copy/paste this statement, “Sommly is a digital marketing platform and marketplace for wineries, which are selling products direct to consumers. Transactions are processed via Stripe Connect, which is integrated with the Sommly platform. The winery’s connected Stripe account will receive all proceeds from the sale directly, Sommly does not take a percentage commission. Sommly bills its customers monthly or annually for subscription services separately and is not party to the alcohol sales transaction. The monthly/annual subscription service is set up via Chargebee”
4. Stripe will ask for a link, screenshot, or response that explains how customers verify they’re over legal drinking age when they enter the site or during checkout. Please feel free to leverage this verbiage, “Sommly has language that ensures customers verify they’re over drinking age when using the platform, as part of terms of service. Additionally, customers will be asked to add birthdate when they create a profile, which is required for checkout.”
5. Stripe will ask, “How does the website indicate shipping and delivery range?” Please feel free to leverage this verbiage, “Each winery will indicate the states that it is legally permitted to ship when the winery is on-boarded. During the shopping process consumers will have visibility to whether or not a winery they are browsing ships to their state. During checkout there will be a validation that the ship-to address is compliant with the winery’s shipping capabilities.”
6. Stripe will ask, “How do you ensure shipping is handled in a way that’s compliant with regulations in a customer’s location? Please feel free to use the following response, “Wineries agree to terms of service as part of onboarding, indicating that they are responsible for accurately reporting the states to which they are permitted to ship. If there is a change to a winery’s license or permit status post-onboarding the winery is responsible for keeping the compliance status current.”
7. Stripe will ask, “Is there an ID check upon delivery? What happens to the shipment when an adult ID cannot be produced?” Please feel free to use the following verbiage, “This is the responsibility of the shipping partner to manage, i.e. FedEx, UPS, etc. If an ID cannot be produced the wine cannot be delivered. Sommly has some language in the terms of service which make this explicit, and there is some language informing the consumer that the ID check will occur upon delivery during checkout.”
Additional info from Stripe:
For those that will be onboarding via self-service and not through an account rep like myself, the questions will appear in their dashboard in the form of yes/no for quite a few so it should be much easier to fill out, except for where they need to upload their licensing info.
Our risk team said they can even initiate self-serve on the connected accounts for you to get ahead of it, but will need better identifiers. If you’re able to retrieve account numbers or emails from those onboarding that would be most helpful, but I do think they should have no issues onboarding either way as it should be relatively straight forward, especially with your onboarding directions. For those that already have Stripe accounts, the info should repopulate as we discussed so that they can simply say that all the same business info will apply to their newly connected account.
Can you share a list of partners for wineries to consider to outsource service support spanning from shipping/fulfillment, to compliance, and digital marketing? #
Please note this is only a partial list of your options, which are numerous. We would be happy to broker an introduction or help you understand the tradeoffs if you would like.
1. Wine storage, shipping/fulfillment and some compliance services:
2. Alcohol Regulatory Compliance, Tax: