Channing Daughters Winery: Managing e-Commerce with Software Innovation

In today’s highly competitive business environment, many wineries are adding online stores to their web sites to generate additional sales. Managing these sales, however, can present unique challenges in tracking, billing and recording information from multiple sources of revenue. For one winery — Channing Daughters Winery of Bridgehampton, NY — the answer to these challenges was an innovative software solution put together by Microworks, a pioneer in winery management software, and Nexternal, an e-commerce division of HighJump, a global leader in supply chain software.

Channing Daughters had been working with Microworks’ wine club management and point of sale software for 12 years when they made the decision to add an online store to their website. “Our wines were excellent, we had a strong tasting room presence here in Bridgehampton and a strong market in New York City and its vicinity, but we needed a strong online presence,” Allison Dubin, general manager and partner at Channing Daughters told The Grapevine Magazine. The winery made several attempts to develop a web page that offered online sales, but nothing worked for them. “We built an online store that was integrated with nothing,” Dubin added. “We could not take online orders, and we were in a do-or-die situation. We needed e-commerce software that we could integrate with our existing software.”

Because Channing Daughters had a strong working relationship with Microworks, they turned to the company for a possible solution. The timing was perfect. Microworks was in discussions with Nexternal about integrating Microworks’ sales management tools with Nexternal’s e-commerce platform. It was an ideal partnership, according to Scott Meloney, founder and CEO of Microworks. “As early adopters of technology in the wine industry, we’ve had customer overlap since early on,” Meloney said. “Our services are complimentary: they’re on the web, and we’re more brick and mortar at the point of sales. There’s a need today for e-commerce and POS to work together, so we decided to make our systems talk to each other.” For Alex Gile, founder of Nexternal, the partnership was a “best of breed” opportunity. “Nexternal is the best of breed in e-commerce and Microworks is the best of breed in POS solutions,” he said. “We had talked for years about integrating our systems, and we committed developer resources to make it happen.”

The ultimate goal of the project, Gile said, was to synchronize customer data so the client could use one database for all sales transactions. Over the next six to nine months, Microworks and Nexternal worked with Channing Daughters to account for all possible scenarios involved with integrating the capture and order processes. For Channing Daughters, the priorities were to improve efficiency in sales management and provide a user-friendly and personal experience for the customer. For Microworks and Nexternal, the challenge was to avoid problems that might compromise the client’s integrity and disrupt the revenue flow. “We had to make sure the right elements flowed to the right place at the right time,” Gile explained. “Nexternal wrote a lot of the integration software but Microworks did a fantastic job of fleshing out the details and testing a lot of different scenarios so that when we put it in the hands of Channing Daughters it just worked.”

Indeed, the integration did work. “Now if someone joins the club online,” Gile explained, “then that information flows into the Microworks point of sales/wine club management software. Conversely, if someone signs up for the club in the tasting room, that information is sent to Nexternal, which creates a customer record and sends a confirmation email to the customer letting them know that they can order online.”

Clearly, Channing Daughters Winery is reaping the benefits of this innovative software. “It’s been fantastic,” Dubin said. “It’s saving us hours, as all sales go into one set of numbers and we don’t have to enter data in two places. This has helped our internal operations become much more effective.” As for customers, whether new buyers or club members, the integration has provided a consumer-friendly process for purchasing wine. The store is synchronized with the website and maintains the Channing Daughters branding throughout, so that all operations are seamless. When a club member logs in, he/she sees a customized page that includes club discounts, promotions and special offers. Yet another benefit to the online store is that it’s mobile-friendly, which ensures that pages function well on all devices. Nexternal’s Gile said, “If you try a bottle of the wine at a restaurant, you can jump on the phone then and there. Our e-commerce mantra is to be able to order anytime from anywhere on any device.”

The Nexternal-Microworks software integration may be the wave of the future in wine industry software. In fact, according to many experts, e-commerce is one of the fastest growing segments of winery software. Nexternal’s Gile told The Grapevine Magazine that wineries today are expected to have an online store. “The paradigm has shifted,” he said. “E-commerce creates a guaranteed revenue stream, and can be very powerful when you’re trying to manage cash flow.” Yegor Kuznetsov, senior marketing communications manager for HighJump, concurs. “Get ready for exponential expansion in direct-to-consumer sales,” he observed. “DTC is more profitable because the winery doesn’t have to share earnings with a distributor or a retailer. Also, selling online to wine clubs reinforces a brand connection. The more loyalty a consumer has to a brand, the more that customer will order.”

While Channing Daughters has enjoyed success with integrated software solutions, the tools might not be right for every winery. Small wineries may be able to run wine clubs efficiently with an Excel spreadsheet, Gile noted, but once a wine club starts to grow, managing the club can become very time-consuming. Gile recommended that wineries begin looking at automation when their membership reaches 100. “One person operating a club of 120 manually may take all day to run a shipment using Excel,” he explained, “but with club management software, the same job can be done in 20 minutes.”

When considering winery software, Dubin advised wineries to first identify their needs. “I would say that club management and POS are first and foremost, and they need to be integrated,” she said. “If you add an online store, it has to look nice and be easy for the user to operate. From my perspective, I need the back end to work so I can make changes easily and monitor orders and pick-ups. It really depends on the scale of your operation and what you can afford.”

Whether you’re a small winery producing 5,000 cases of wine a year or a large estate making tens of thousands of cases, implementing or upgrading winery software may be a wise — or even mandatory— business decision. To stay in the game, every winery needs to keep track of rapidly-changing software solutions and determine whether these tools can give them a competitive edge for managing their sales.
Channing Daughters, located in Bridgehampton, NY, operates 28-acres of vines, a winery and a tasting room. With a 35-year history — beginning in 1982 when founder Walter Channing first planted Chardonnay in a former potato field — the winery now produces 14,000 cases of wine annually, featuring an impressive portfolio of over two dozen grape varietals. Channing Daughters employs five full-time people and five part-time people, as well as a full-time staff of four in vineyard operations.

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