BevMo! first made a splash in the Bay Area about 18 years ago, when it opened its first five stores. Since that time, the company has grown into one of the most successful beverage specialty store chains on the West Coast, with 114 units throughout California and Arizona. President Steve Higgins says the secret to the company’s success has had as much to do with what BevMo! stores aren’t as what they are. The company has made it its business to distinguish itself from other stores selling wine, spirits and beer by cultivating a fun, comfortable environment populated with a highly knowledgeable staff. Combined with the wide selection it offers, the customer-friendly atmosphere of BevMo! makes for a nearly unbeatable strategy. 

Higgins spells out the company’s identity as one that’s focused entirely on providing shoppers with the best possible experience when they shop for beverages. “The keys to the company’s success so far are that we are very much focused on a brand experience, a shopping experience and a specialty beverage experience,” he says. “We’re convenient and we’re fun.  Our stores are well-lit, well-stocked, well-selected and well-positioned in retail settings.” In positioning itself as the antithesis of the average liquor store, BevMo! has created a beverage shopping experience that customers regularly sing the praises of, and one that invites them to come back again and again.

A Better Alternative

Unlike many independent liquor stores, BevMo! locations are situated in heavy-traffic areas, usually in popular shopping centers found throughout major metropolitan areas such as Los Angeles, San Francisco and San Diego. The company’s stores also keep more conventional retail hours, typically between 9 a.m. and 8 p.m., as opposed to other liquor stores that open later in the day and keep much later hours. Higgins says this makes customers feel more comfortable while they shop.

Also contributing to customers feeling safe and comfortable is the fact that BevMo! puts a lot of effort into the appearance of its stores. “We have a very premium look to our store and we have a premium offering that is not available in our competitors’ stores,” Higgins says. 

Knowledge is Power

But there’s more to BevMo!’s strategy than simply looking better than its competitors. Higgins says that would be meaningless without the full selection the company offers. “I think the real strong advantage over the competition is the depth and breadth of our selection,” he says. “Our team is singularly focused on bringing the best of each beverage category to our customers.”

In addition to all of the well-known, national brands of beer, wine and spirits, BevMo! prides itself on carrying a broad selection of craft beers, lesser-known wines and specialty spirits. These beverages are arranged by category and color-coded, making it easier for customers who want to try something new to find something that matches their taste. 

In situations where the customer still can’t make up his or her mind, BevMo! comes to the rescue with a staff made up of highly trained and experienced salespeople. Higgins says the company puts its salespeople through an extensive training program that covers every aspect of wine, spirits and beer, making them into BevMo! experts who can direct customers to new or smaller brands they may have never heard of before. 

Each BevMo! location has at least one wine expert on staff, and Higgins says these wine experts are trained by one of the best. The company’s cellar master, Wilfred Wong, is one of the most experienced wine judges in the United States, according to the company. Wong tastes approximately 8,000 wines and judges in more than a dozen major wine competitions each year. “My journey each year begins in January, when I judge in the San Francisco Chronicle Wine Competition and quickly moves abroad to Argentina, Chile, France, etc.” Between his frequent travels to key wine-producing countries including France, Spain and Australia, Wong stays current with the more than 4,000 wines, 2,100 spirits and 2,000 beers stocked by BevMo! Many of the wines found for sale at BevMo! are marked with signs containing Wong’s personal description and rating for customers’ information. Wong also writes a blog for the company’s website, where he frequently features new wines and spirits and provides detailed impressions for each.

Having this level of knowledge and passion within the company means that BevMo! can help its customers find whatever they’re looking for, and even some beverages they didn’t know they were looking for, Higgins says. “We feel like we can offer service, information and engagement that many of our competitors do not,” he says. “We’re very passionate about wine, spirits and beer and our team has deep expertise in each category which enables us to bring great products to our customers.“

Customer Conversation

BevMo! also is working hard to cultivate a better relationship with its customers through the application of advanced point-of-sale (POS) software and other technology, Higgins says. 

BevMo! is discovering that information and education is a two-way street, and the company is developing new strategies to learn more from its customers to better serve them in the future. These efforts include the development of new POS systems in partnership with NCR that speed up the checkout process as well as new customer survey initiatives that use software to collect information about customers’ likes and dislikes. 

“Our technology is focused on how we can serve our customers better,” Higgins says, “while ensuring that their local BevMo! accurately reflects the tastes and wants of the community it serves.” 

For example, BevMo! is fostering greater interaction with its customers through the use of customer surveys administered by Mindshare, a global marketing and advertising firm. Higgins says customers will sometimes receive follow-up customer service calls the same day they visited their local BevMo! store. 

BevMo!, in turn, uses this information to profile its stores depending on the types of products that are most popular at each location. In this way, the company develops a product mix that is tailored specifically to the community’s preferences. “That’s very important when you’re a beverage company,” Higgins says, noting the brand loyalty many customers tend to have. “We want to be your neighborhood BevMo!.”

Membership Privileges

Another way in which BevMo! interacts with its customers is through its incentives and discount programs. The company utilizes a number of special programs to entice shoppers to visit their local BevMo! stores frequently. The most extensive of these programs is ClubBev!, which provides shoppers with the opportunity to save money on their in-store and online purchases. 

ClubBev! membership is free to customers, who can apply for membership in our store or online. Once they have their membership card, shoppers can find hundreds of special prices available to members each month. These include savings on spirits and beer, as well as other products. Customers who shop online can find special ClubBev! pricing through special filters on the company’s website. 

ClubBev! members also have access to a special 5 percent savings reward program. Whenever customers spend $250 online or in the store, they receive a 5 percent savings coupon to apply toward a future purchase. In addition, ClubBev! members also have premium access to special events throughout the year at their local stores, including special wine tastings and celebrity bottle signings. 

“We’re really focused on building loyalty, building BevMo! fans and building a shopping experience that’s unlike any other in the industry,” Higgins says.

How BevMo! Wins

“The BevMo! story is represented most successfully during our widely anticipated 5¢ Wine Sale event,” Higgins says.

BevMo’s signature 5¢ sale event consistently drives new traffic to its stores, promotes an increase in ClubBev! membership, he adds. Over the last three years, the sale has grown approximately 15 percent as the event continues to resonate with customers looking for great wine at an incredible value. 

“We sell wines ranging from $10 to $60 and the second bottle for 5¢,” Higgins explains. “Buzz products are critical to the success of the 5¢ sale – big brands and often limited quantities drive the customer’s interest and they come back each sale to find something new.”  

BevMo! is also focused on the emerging craft beer business, which has seen a 30 percent growth over the last two years for this category. “With more than 166 micro and craft brewery partners from Maine to California contributing to an assortment of over 1,000 craft beers, BevMo! is positioned to offer our customers an incredible selection and the opportunity to explore, discover and share in this wildly popular category that we feel so passionate about, just as our customers do,” Higgins says. 

“BevMo! clearly wins at creating customer excitement,” he continues. “Our deeply experienced buying team works with our suppliers and stores to keep our product assortments and customer shopping experience relevant and refreshed. As leaders in the marketplace we are able to react quickly to trends and customer feedback to offer the best brands, value and uniqueness anywhere.”  

Partners for Success

BevMo! has cultivated unique supplier partnerships that are key to achieving differentiation and success in the marketplace. This year, BevMo! held its 3rd Annual Merchant and Supplier Strategy Conference (MASSC), where more than 20 key partners in conjunction with its top distributors – Southern Wine and Spirits and Young’s Market Company – participated in this open forum for exchange of business strategies, growth opportunities and partnership-building for the future that continuously builds BevMo!’s leadership position in the specialty beverage marketplace. 

“Every year this event becomes more and more important for the identification and execution of our mutual business plans for success and is an opportunity to assess our role as a competitor and a leader in the trade,” according to Higgins.  

“We also rely heavily on these partners for our supply chain needs, along with other partners such as Just Enough and Unified Grocers to ensure our inventory distribution and delivery demands are executed timely and efficiently on a daily basis to our stores,” he adds. 

“Relationship-building is essential to successful partnership,” Higgins continues. “We value our suppliers for the support they provide our teams, stores and customers, as well as their expert insight into the marketplace in support of building the BevMo! brand.”

Significant Achievement

As an example of the way in which BevMo!’s commitment to its customers and a quality shopping experience has changed the landscape for specialty beverage retailers on the West Coast, BevMo! was given a Lifetime Achievement Award from beverage industry publication The Tasting Panel in 2008. Even though the company was only 15 years old at the time, the Lifetime Achievement Award demonstrates the impact the company has had on the industry in that short time. 

“As the recipient of The Tasting Panel’s 2008 Lifetime Achievement Award, BevMo! is being recognized and commended for its impressive past, growing present and bright future,” according to the magazine.

Strong Identity

Complementing the friendly atmosphere in each BevMo! store is the customer-focused environment that exists within the company’s corporate offices, Higgins says. The corporate staff is a relatively small group, very open and collaborative with many, many years of experience in the industry. 

“Quarterly business reviews are presented by the BevMo! leadership team to both corporate and store employees to communicate company goals, objectives and results lending visibility and the opportunity to participate by all levels of employees in the strategic initiatives and ultimate success of the company,” he says.  

Being a small company, BevMo! recognizes the importance of and promotes internal growth opportunities, employee recognition awards and bonuses for performance goals, as well as succession planning, particularly for its Store Associates.

“The training and development of our store associates was made a top priority in 2011,” Higgins says. “Our Wine Apprentice program, in partnership with Southern Wine and Spirits, recently graduated 68 wine specialists throughout our stores to assist and engage our customers with their wine selections. In the spring, we will be partnering with Stone Brewery in San Diego to offer the first Cicerone beer training class for selected associates, again an important opportunity for us to educate ourselves to better serve our customers.”  

What Lies Ahead

Higgins says his philosophy is that business means taking calculated risks, and that no business can succeed unless it stretches beyond its boundaries once in a while. As such, he says BevMo! is always learning about the industry, and this natural curiosity will continue to help the company grow beyond its boundaries into new territories. 

All of the company’s various strengths will come into play as BevMo! prepares for the challenges that lie ahead. Higgins says the company looks to expand by 15 to 20 locations each year, but admits the recession has made things more difficult in that regard. In addition, new and expanded competition has increased the number of outlets where shoppers can find specialty beverages, and government approval of new liquor licenses has slowed down in recent years because of the recession. 

“We have to work harder to get the right locations because there aren’t that many good ones available,” he says. “There’s always a challenge to grow the brand, move into new locations and expand the BevMo! footprint.”

Nevertheless, Higgins believes expanding into new markets will spur the company’s continued growth into 2012 and beyond. And there’s good reason to believe it will – as the company discovered when it first moved into Arizona. At the time the company was considering entering the state a thorough search through its database of ClubBev! members revealed more than 12,000 members already lived in Arizona and had shopped at BevMo!. And it appears the company’s efforts to build a memorable and pleasurable shopping experience have borne fruit. In a recent article published in The Tasting Panel, it was noted about the company that there is a group on Facebook that consists of BevMo! fans called “When I die, instead of Heaven, I want to go to BevMo!”

As long as BevMo! continues to hold true to the principles that have fueled its success so far, Higgins says, the future looks quite promising. Although the company doesn’t have any plans to change its formula, it doesn’t see any reason to do so, and Higgins says BevMo! expects to be at the front of the pack long into the future.

“I see us continuing to develop our brand and continuing to be the wine, spirits and beer beverage store that leads the way,” he says.