Which Online Wine Ordering Service Is Popping the Bubbly?

Ian O'Rourke Posted by Ian O'Rourke

Britain has a deep thirst for wine, and it’s now very popular for customers to buy their Chardonnays and Merlots online. Which retailer has been most successful in this area and why?

According to The Drinks Business, the online wine market was worth £800 million in 2013, accounting for 11% of the total market for wine in the UK. As such, companies that win the PPC race can expect pleasing returns.

This market, however, is currently dominated by major retailers that exploit their established reputations and big wallets. This represents a challenging, though profitable, opportunity for new players seeking to break through.

Aggressive Spending from Two Supermarkets

Wine retailers share of spend, Adthena data

Wine retailers share of spend, Adthena data

Tesco and Marks and Spencer ranked as the top spenders by a huge margin for the fiscal year ending November 1, 2014. Tesco’s share of total PPC spend never fell below 30% until October, and even broke the 60% mark in June. Marks and Spencer climbed throughout the year, eventually switching places with Tesco and nearly topping 60% themselves by the end of the year.

How these Numbers Translate to Traffic

Wine retailers paid share of voice, Adthena data

Wine retailers paid share of voice, Adthena data

The SOV traffic for the 2014 fiscal year might surprise you: Asda makes a notable appearance towards the top, despite its share of spend rarely rising above 10%. Tesco’s and Marks and Spencer’s shares reflect, generally, what they spent during this period.

Asda managed to mirror M&S’s results until August, when the latter soared above and beyond. Marks and Spencer’s eventually came out on top in November, managing to score nearly 45% of the share of voice (SOV) at a time when M&S spent just under 60% of the total while Asda spent just under 15%.

That said, we’re sure that many brands want to know precisely how Asda managed to keep up for so long.

Of course, there are the PPC-related factors, such as ad and landing-page quality. If your landing page is poor, you will pay more in the end as a poor quality landing page is bad for your quality score and quality score and your maximum CPC influence the price you pay.

Meanwhile, getting your ad displayed in the SERP only proves useful if your ad copy makes people want to click on it. Adthena’s ad copy analysis can help in this manually almost impossible part of digital analysis.

The sole new entry targeting the analysed keywords was Ocado, which accounted for only about 5% of share of spend and share of voice for September and October. The fact that the biggest online-only retailer is struggling to make a dent suggests that this is a particularly tough and competitive market.

Asda’s Advantage

For the 30-day period ending December 15th, the top keyword for this market was asda wine, suggesting that people are used to getting a good deal from their preferred brick-and-mortar retailer and expect the same online.

Asda wine deals, asda wines, and asda wine offers came in at second, fourth, and fifth place, respectively, suggesting that Asda is marketing itself very effectively outside search, and that the odds are therefore in their favour even before the PPC action begins.

Prosecco wine came in at third place, with red wine and wine at sixth and seventh – indicating that generic keywords remain important as well. However, Asda-related keywords still unquestionably dominate the market, as asda wine took home more clicks than prosecco wine, red wine, and wine combined.

It’s also important to note that customers like offers and deals: two of the big Asda keywords included offer or deal, while customers also searched for deals from other supermarkets like Tesco and Sainsbury’s.

In a market where Asda enjoys so much success, the other brands and new players might benefit from bidding on more precise keywords, like the specific types of wine.

Overall, it seems that the online wine market is treading through unpredictable territory: You can still spend your way to success to an extent, but some brands may hardly need to spend at all.

The main lesson here seems to be: market to your strengths. Asda has a reputation outside search, which they’re exploiting. Those brands that fill in the gaps, be it premium, speciality, or otherwise, will be able to follow suit and find their own niche.

(Main image credit: Derek Gavey/flickr)

About the author

Ian O'Rourke
Ian O'Rourke
Ian is the CEO and Founder of Adthena. He has been involved in technology businesses and start-ups for over 22 years and has built businesses across the globe including in Silicon Valley, London, Australia and Taiwan. Ian has grown Adthena since 2012 to its current position as the premier global provider of competitive intelligence. Ian likes to foster a culture of great products, getting things done, responsibility, freedom and continuous improvement.