Christian Navarro of Wally's Wine & Spirits, on Expanding Market Reach in Evolving Retail World
March 14, 2019
Professionals from all sectors of the wine industry gathered for the annual Central Coast Insight and WiVi Central Coast conferences on March 12 and 13 in Paso, Calif. Each full day of sessions focused on the economic and financial state of the Central Coast wine region as well as provide insights from experts about how to expand the region’s reach in both the direct-to-consumer (DtC) and retail marketplaces.
WiVi drew more then 2,000 people to the Paso Robles Event Center, record attendance.
Both Tuesday’s and Wednesday’s event opened with a keynote address from Christian Navarro, president and principal for Wally’s Wine & Spirits — a Southern California wine shop, bar and restaurant focused on experiential marketing, providing luxury experiences to its clientele both in-store and online.
Navarro spoke about how Wally’s Wine & Spirits has evolved from a “traditional” wine shop, to a modern, complete “experience” for wine consumers today.
Established in 1968, Wally’s, Navarro said, as a business has survived, what he called, “an end of an era” — the end of traditional retailing. He called out record shops, video stores and bookstores as dead or dying breeds in the mass consumer market. At one point, Navarro, who began his career at Wally’s in 1991, looked around the wine shop and thought, “we could be next.”
“The only way to survive is to reinvent ourselves,” Navarro said. But he also noted that the foundation of the business’s success was personal interaction with customers: “This is still true today,” he said.
“Back then there was no Robert Parker, or Wine Spectator and few wine writers who influenced consumer purchasing decisions,” he said. The Wally’s business was built on customers visiting the brick-and-mortar establishment, asking questions and purchasing wines based on the one-on-one interaction with employees.
Today’s wine consumers are living in the age of the internet, increasing both the number of potential influencers (wine writers, wine critics, brand ambassadors and social media “influencers”) and the availability of wine as a product. “The internet and its effect is a good news/bad news situation,” Navarro said. “It has turned wine into a commodity.”
So how can a business who’s basic business model is dependent on customer interaction thrive in this modern market? Create an experience for consumers; compel customers to come into the location: “If they have to come in, they will,” Navarro said.
Wally’s Wine & Spirits revamped their retail offerings. Today, the store includes not just a wine shop, but a wine bar, restaurant, deli and even retail shopping. With the old business model, Navarro said Wally’s would see between 50 to 70 customers in a day; today, about 1,100 consumers walk through the wine shop’s doors. He also noted that previously, their clientele was dominated by the male demographic (about 90% of total consumers). Today, about 51% of Wally’s shoppers are women. “We didn’t lose that 90%. We gained a whole group of people we’ve never touched before,” Navarro said.
Navarro said the business model is a “brand builder, not a discounter.” “We try to have the retail wine prices the same as our restaurant bottle prices — we live off of dollars, not percentages,” he said, adding that people will “step up” and spend money because they see the value in their wine. “We’re creating value and engagement,” Navarro said.
Of course Navarro cannot negate the importance of online marketing as well. The challenge comes in communicating the sense of luxury and personal experience found in the store to consumers via the web. Targeted emails, ensuring the website tells the brand’s story in a relatable and engaging way and utilizing social media in affective way all play a part in the acquiring and maintaining a strong consumer base. “But it’s always a soft sell, never a push,” Navarro said. “We don’t want to sell anything, just provide the opportunity for pleasure…my job is to provide pleasure.”
With the opening of Wally’s new Santa Monica location, Navarro said the business has gained over 5,000 more followers on Instagram. Though he feels the age of the internet has decreased, what he called, the “tactile involvement” with customers, he also sees it as a new type of experience for the next generation of wine drinkers. He said that through social media, especially Instagram, Wally’s is able to connect with customers (and potential customers), increase brand loyalty and, thus, increase sales. “The ‘Instagram factor’… is a (new) version of tactile involvement.
Navarro and the Wally’s team is also constantly looking toward the future, at the next evolution they’ll need to make to accommodate consumer expectations. “What’s next?” he asked. “Cannabis? Catering? Events?” The answer: All of the above.
“Retail isn’t dying, it’s changing. We need to evolve with the times,” Navarro said.
Wally’s also works with endorsements from top brands, including The Four Seasons, Delta, Christie’s Auctions and Private Suites, partnering with them to create unique events and tasting experiences for wine consumers across the globe. “These third-party endorsements communicate worth and value,” he said.
Looking at a room full of Central Coast vintners, Navarro admitted the majority of the wines sold through Wally’s is foreign and that most California wines are from Napa and Sonoma. “We have 125 wines by the glass. Only 8 to 10 at a time are from the Central Coast,” he said.
But he also called the Central Coast wine region “The greatest wine region nobody knows.” Being Los Angeles-based, he feels that his shop can be a testament to what’s available to one of Southern California’s closest wine regions. As the business continues to grow and expand its reach through its marketing programs, Navarro said, “we have the opportunity to take Central Coast along with us.”
“We’re in this together,” Navarro said. “Wally’s is going to step up to take investment in time, product, energy to hopefully help move forward to promote Central Coast. It’s time.”
In conclusion to his Wednesday presentation, Navarro offered up his advice to the Central Coast wine region on how they can help themselves get into the lives of more wine consumers:
1. Create a destination people will come to. Work with other hospitality businesses — restaurants, hotels and activity organizations — to create a desirable destination.
2. Find people who can carry the flag outside of the region. Connect with retailers, restaurants and event coordinators in major cities (like nearby Los Angeles) who can create an environment where people can learn about the wine and wine region.
3. Partner with fellow Central Coast growers, winemakers and other wine industry professionals to create satellite tasting rooms/pop-up tasting rooms in locations outside the region.