Ep 527: How Sarah Hoffman Turned Maker Wine into a Canned Wine Brand You’ll See on United Flights and NBA Stadiums

0:00Sarah Hoffman:The number one reason most canned wine is not great is that people are putting not great wine into cans. Through 2023, we were over 90 % direct-to-consumer. Around that time, shipping and fulfillment costs were raised quite dramatically. Acquisition costs were also getting higher. And we made a pretty big pivot as a company to become a true omni-channel business. Today, we're under 30 % direct-to-consumer, and the majority of the business is our wholesale and now airline partnership. From the very beginning, we always wanted it to feel like a membership versus a subscription. Most of our competitors are taking bulk wine and white labeling it, and what we're doing is a lot harder.

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1:49Sarah, welcome to the DTC podcast. I'm really excited to dive in with you on Maker Wine. Can you start with your origin story? What was the spark that caused you to create this awesome brand and business?

2:02Sarah Hoffman:Yeah, thanks so much for having me, Eric. Maker is a premium canned wine company that highlights the stories and products of independent wine producers. I started Maker actually in 2019, early 2020, right out of business school with two of my classmates, Kendra and Zoe. My background, I've always been a foodie and into craft products. I actually was a home brewer and loved craft beer first before wine and also hosted a underground supper club in my apartment in San Francisco where I'd pair local craft breweries, beers, and some of my own home brews with a friend who is a chef's dishes. And my favorite part of that experience was getting to highlight the maker stories and that's what I think makes Food and Bev really exciting.

3:03Sarah Hoffman:I actually was always intimidated by wine and by my own knowledge of wine and it wasn't until I was in school that I joined the wine club and started visiting local wineries around California and I just fell in love with these producers and their stories and I thought you know as a wine drinker, why aren't we highlighting this? Why does it feel like there's this pomp and circumstance and this elitism to wine? I think it'd be really neat if we could borrow some of the form factor and casualness from the craft beer movement, but highlight these people and make the makers the star of the show. As soon as we graduated, my co-founders and I launched a three wine pilot a Vignet, Chenin Blanc, and Rosé, vintage varietal, AVA-designate wines in cans, and sold to our friends and family and friends of friends.

4:04Sarah Hoffman:And it sold out, and we knew we were on to something. So that really was the beginning of Maker. Super cool. I love the fact that it's a platform, essentially. More so, you did have experience making beer, but you didn't think, okay, let's invest in a winery. You sort of thought about, let's be a platform for these other makers that already have these amazing stories. How did you select your first wines? Well, as part of the startup process, we had gone out and interviewed dozens of winemakers. And it's a really small, tight-knit community. Once you get to know a few folks, they'll introduce you to their friends and other people they respect.

4:44And what was really loud and clear at the time,

4:47Sarah Hoffman:and still, is that it's really hard to be a small wine producer. These folks are making incredible wines, and for them to get the attention of distributors is really tough. And it's a really fragmented industry. So we felt that with our background in digital and e-commerce sales, we could be this platform. And what was most surprising to me is that we showed up with Coca-Cola cans with wrapping paper on it to show them what the concept could be. and we would leave the meeting and they would be totally game to try this. They wanted to reach a new audience. I think that's a big question in wine too, is how do we reach millennial drinkers?

5:30Sarah Hoffman:Our audience at the tasting room tends to be older, a certain demographic. How do we get the next generation interested in wine? And, you know, Cannes seems like a cool vehicle for that. Talk to me a little bit about that. I enjoy wine and there have been times in my life where I've gotten into boxed wine and there's this sort of like stigma around boxed wine a little bit. But like talk to me a little bit about the process of canning wine, how the strategy with that and how the markets reacted to it. Yeah, definitely. You know, I think often when you talk about canned wine to people, they say, oh, you know, canned wine's gross.

6:07Sarah Hoffman:You can taste the can. And I think what we really found was the number one reason most canned wine is not great is that people are putting not great wine into cans. And there's a few reasons for that. And one of them is really like customer education because, uh, you know, our cans, for example, are two 50 mil cans or a third of a bottle. So they're almost two full glasses of wine, but people aren't really used to paying more than a couple bucks for a can. So, um, if you, you know, equate that into a bottle cost in order to make that work, people are putting, um, low quality wines into cans. And I think our thought was if we could lead with education, we could help show that, you know, you can pay a bit more for a can and it's still a really great deal.

6:57Sarah Hoffman:As far as the actual canning itself, we started with mobile canning lines. So we would, um, we'd work with a winemaker. They would make the wine in their tanks. And we showed up with a local company called the Can Van, awesome female led company. and they would pull a canning line out of their truck, hook it up directly to the tank right there. The whole maker team and the winemaker would work the line side by side, and we would be there for sometimes three to five days canning a vintage. Now we do for our larger cannings. We have a high-speed canning line partner in Geyserville. That's an incredible machine how much wine they can can in a day.

7:42Sarah Hoffman:I bet. But those early days of canning side by side with the winemakers made for some, you know, really great stories and content as well. Talk to me about how you've built, you said you're leading with education. And I think there's good wine tastes better. There's no doubt. But it's almost, humans are so suggestible that when you read a beautiful description of what the wine is or where it's from or the story around it, you can also make it taste better in your mind because you're visualizing, oh, this does, this is oaky. This is, you know, like I get the raspberry notes or whatever. So talk to me about how you put education forward in your canned experience.

8:19Sarah Hoffman:Yeah, and I think one important note is just knowing your customer really well. The sort of feeling I described earlier of being unsure of my own wine knowledge, that's really common in wine. Over 80 % of our customers describe themselves as advanced beginners. They're people that know what they like. They are interested in learning more about wine, but they're scared to label themselves experts, but want to be smarter in wine. And I think that that's really how we try to talk to people in a way that doesn't dumb down wine, but speaks about wine in plain language and helps to educate around a few key story pieces or insights that will be memorable, that you'll remember that one thing about the wine.

9:08Sarah Hoffman:Each of our wines has a signature of the winemaker who made it, a couple of tasting notes, and a QR code for them to visit this landing page that has a blog post, video content, a short two-minute video of one of our sommeliers talking about the wine in a really fun way. And so for those that want to dive deeper, we definitely create that space. In our subscription can club, we do have a quarterly meet the winemaker virtual Zoom. So we'll have the winemaker come on the Zoom and we'll have our club members come on and all crack a can together. And that really goes back to our roots from launching during COVID and really growing through virtual events and being able to have a single serving of wine while you're at home on Zoom.

9:59That's such a smart way to connect the offline to the online. You get people really interested in the story are going to be maybe interested in a subscription. So getting people onto that website through the QR code is super smart. But you brought up something else really pivotal in your journey in those early days. I remember I started this situation at Pilothouse and D2C right at the start of COVID. And in those early days of like drinking together with Zoom, I remember one time the CEO, the founders gave, you know, delivered beer by hand to everyone's home. and we had this local brewery and we all sat down and drank too much.

10:36And it was quite a memorable experience. Talk a little bit about that strategy of hosting hundreds of virtual tastings.

10:41Sarah Hoffman:Yeah. I mean, it's really the way we built the company in the first two years. We had just graduated from business school and the pandemic had really just kicked off and we could only sell in California at the time. We had our license in state, but didn't yet have the licenses to sell across the U.S. And really the main asset that we had was this incredible network that we had just built over the past few years of our classmates suddenly entering the workforce across the U.S. and the world at completely different organizations. And so we started with that group and asked them to introduce us to, you know, events in HR, folks at their companies.

11:27Sarah Hoffman:And, you know, yeah, like Pinterest, Airbnb, Coinbase, Meta, some of the biggest, most prestigious companies that had presences in the Bay Area. We'd start with a small team and they would have great feedback and it would spread like wildfire. We'd sometimes do 12, 15, 20 events within one company. and what we would do is we'd send a six-pack, sort of the trial pack of our wine to all of the folks on the team. And we'd have the founders at first get on and share our founding journey and then walk through. We typically open three wines on the call and walk through. I'm not a sommelier. Walk through not just sort of the wine tasting notes, but talk about the stories, how we met these winemakers, what makes them special, like nuances of the canning process or, you know, funny stories from launching that wine with them.

12:30Sarah Hoffman:And, um, also let people drink and engage with each other. And, uh, besides hopefully being sort of a different fun experience and the cans are a great vehicle for that because it's almost two glasses of wine. So you could open three cans and it's one bottle. So if you're there, you could have half a can each and then split it with your partner after the call or drink it the next day. And it was, it was a great way to show the utility of wine and also to sort of be an infomercial for maker. Some of our club customers today are people that I meet. They always reference a tasting that we've done.

13:04Sarah Hoffman:I still meet people and they go, Oh, you did this OC fundraiser tasting. Um, and we loved it. Like I joined the club. I've been a club member for five years. And so not only was that, you know, it was such a sticky acquisition channel as well as being, you know, very profitable and ROI positive. And it's something we still do to this day. I mean, obviously the demand for virtual tastings has gone down, but we do, for example, work with wine sommeliers and influencers that host their own virtual club events and they'll partner with us for a tasting. And it's something that we find to be super effective.

13:46It's again, it's that you're wrap, you're got your own story that you're wrapping into it, you're wrapping in the maker's story. And then the form factor, as you mentioned, is so critical, I think, to be able to test multiple different wines rather than just the commitment of like opening a bottle. And I imagine that plays into I hear all the time about like, younger people are maybe drinking less a little bit too. I don't know if you're seeing that. But I feel like the canned experience for so many people, maybe just younger getting into drinking, they have so much experience drinking cans of other things that the form factor probably really helps with some of the trends that are going on.

14:19Sarah Hoffman:Yeah, I think when we launched, it was like right after the summer of White Claw, you know, so I feel like the convenience of cans was very hot and salient for people. I definitely think the serving size, I mean, we do surveys of our club customers and the number one thing they say is the the portion control piece and that they can not they can open a glass and have it after dinner and not throw away an entire bottle so yeah that or wake up with a headache yeah definitely super key and i think also transparency i think that um i personally think that it's not that millennials aren't drinking wine it's that wine may not be speaking to them.

15:03Wine is actually an incredible beverage that fits into what this generation is

15:11Sarah Hoffman:really looking for. For example, all our wines are dry. They're less than a gram of sugar per can, no additives or, you know, really anything added beyond grapes and yeast. And they're from, you know, diverse producers that have incredible stories, real, incredible artists that are making this product. And I think that, you know, people are really surprised to learn that they say, oh, did you make sugar free wine? It's like, no, actually, wine is dry wines that are fermented fully are naturally low in sugar and carbs. And I think that the wine industry is sort of cloaked in mystery and being able to talk about it in plain language can help people see that in the, you know, alcoholic beverages are not health beverages.

16:01Sarah Hoffman:But in the scheme of what's being drank today, it really actually fits in well with what this generation is looking for. Better than Four Loko. Yeah. Better than Four Loko. Talk to me about your distribution story, because I know you started heavily D2C and sort of viral with these virtual tastings. Walk me through how your distribution has evolved. Yeah, it's really changed quite a bit. Through 2023, we were over 90 % direct to consumer and really focused on our online growth. We found around that time, as many businesses, especially in our space did, that shipping and fulfillment costs were raised quite dramatically and the acquisition costs were also getting higher.

16:55Sarah Hoffman:And we made a pretty big pivot as a company to become a true omni-channel business. So today we're under 30 % direct-to-consumer, and the majority of the business is our wholesale and now airline partnership. So you can find our sparkling wine on all United flights in North America, which is really exciting. And we really stopped majorly investing in digital marketing and ad spend and reinvested those dollars into our wholesale marketing, into content, and really profitable growth. And so I think we have a super balanced business and these channels really feed into each other now. So you might discover our wine on a flight, scan the QR code, join the club.

17:49Sarah Hoffman:And it's been really incredible to see those benefits. Talk to me about how the airline partnership came about. Yeah, I mean, that was an incredible partnership that my co-founder, Kendra, who leads our business development, led. She worked closely with the team and they're really excited to highlight a female led brand. We, you know, as a team came together to actually can samples for them to try on this really tight timeline and has been such a huge partnership for us in terms of visibility. we launched in October and, um, just in the last few months, I would say, uh, meeting folks in stores, they say, Oh, I tried this wine on United on the plane.

18:42Sarah Hoffman:Um, and I'm just really excited to see that partnership grow and to really help with brand awareness for not only us, but for our makers, our winemaker, whose wine is on the plane, Nicole Walsh, her name is on the front of every can. And that is so exciting to me because, you know, our mission is really to lift up these producers. And now people are going to know her name and her small winery in Monterey. And I'm really excited to see how that impacts her business as well as ours. For the United partnership, it's its own product. Do you have a like a specialized product that goes to that vendor, basically?

19:20Sarah Hoffman:We launched that SKU exclusively on United. And it was, you know, an awesome feat from our production team to create that wine. We do, we are now selling that wine through our wholesale channels. So I'm excited to see, you know, the impact of being able to find that wine in your local Safeway, for example. You mentioned your wholesale marketing that you've put a bit more emphasis on because it's kind of like this isn't, you know, there's obviously wine in all these stores, but it's a bit of a category creator, I imagine, And because you're doing this high quality wine in cans, talk to me about being kind of the first to market in that area and how you've used retail marketing to help with education there.

20:01Sarah Hoffman:Yeah, and I think this is one area where building a strong online presence was really beneficial for us because we had this incredible online community when we went to buyers to show them that there really is a need there. We also, as a marketing strategy, entered all of our wines into top bottled wine competitions. And they don't know that it's a can, the judges, when they're trying it because it's poured into cups. And so we had these incredible anecdotes and stories. For example, one of our first ones was the Press Democrat North Coast Wine Competition. And we had these master sommeliers and judges award, you know, our V &A best of class white wine, 96 points.

20:49Sarah Hoffman:And we're just shocked when they found out that this wine came from a can. And, you know, we got a lot of press around that. And I think being able to go to these retail buyers and say, you know, there is a need for high quality wine in a can. This is our industry cred to back it up. A lot of them are, you know, old school, been in the industry for dozens of years and naturally skeptical of cans. That's been really huge for us. So, you know, we often are the highest priced or second highest priced can on the shelf at a grocery store. And I think, you know, sometimes paradoxically within wine, that can indicate quality and help customers realize that this is maybe something different than the cans they're used to seeing on the shelf.

21:36Sarah Hoffman:I think we also highlight interesting varieties. Most of our competitors are just doing, you know, red blend, white blend, sparkling. And we have 17 different wines. We highlight everything from Anderson Valley Pinot Noir to Cabernet Pfeffer, a super obscure grape, you know, grown in seven acres in North America. But wanting to do it in a way that is, oh, interesting. What is this? not in a way that is keeping people out of wine. So we're doing something quite different. And it's been exciting to see our first chain placements come to be. And I think as a way to keep the online audience special, we do have a line of reserve wines, club-only wines, that you really can only access if you're a club member.

22:27Sarah Hoffman:And we found that that is much more compelling to long-term retention than excessive discounting. So that's kind of also been a secret weapon of ours that we can highlight several wines just for our online audience. Talk to me about the club, because I think in the pre-interview you said something like 70 % of your revenue comes from the club. That's what ChetGPT reminded me. I don't know if that's true. What makes your experience typical from a different subscription box? And then what are you doing to drive into that? Is that a lot of QR traffic? Are QRs really working well for you? Yeah. So within our e-commerce channel, 50 % of our revenue is from club subscription.

23:07Sarah Hoffman:And then it's up to 75 % if you include those club members all at cart purchases. So them ordering in between their quarterly club boxes. And yeah, I think from the very beginning, we always wanted it to feel like a membership versus a subscription. So it's not a subscribe and save where you get the same thing every quarter at a discount. It's a fully customizable. You have a two-week window to come in and pick exactly the wines that you want. It's a rotating selection of wines. So for some of those more esoteric wines, if you get them one quarter, they may not be available the next quarter. So it does feel like this ephemeral experience where you're getting access to this moment in time, these specific craft wines that aren't going to be available ongoing.

23:59Sarah Hoffman:We also do do the Meet the Maker Zooms. We often put little surprise and delight items in the quarterly boxes from like wine release stickers to hats to fun little invites. And in terms of acquisition, one thing that we've really done is been adaptable and open to those arbitrage opportunities. So, you know, at first it really was the virtual events. A big acquisition driver for us every year is our 12 days of canned wine advent calendar. We just repackage the wine into an advent box. And we get tons of pickup on local press and affiliate partners. Just word of mouth, I imagine, too. People telling their friends about an advent calendar that they'd actually care about.

24:51Sarah Hoffman:Yeah, we first found that. We first came up with the idea by looking at the search traffic around wine terms and seeing wine advent calendar really jump around the holidays. um seo is also an area that we really focus on and and and really fits in with our education thesis of wanting to own certain keywords in wine and i really find that it's less competitive than some other categories probably because there's less of an e-commerce focus in the wine world and then finally i would say like our creators and affiliate partners we um you know especially from the virtual wine event days where we built relationships within the wine community of folks hosting their own wine tastings, we gift our new releases to creators in certain categories and find that they're really often excited to enthusiastically share and make a kickback on the wine purchases that they drive.

25:51Sarah Hoffman:So it really hasn't been like one channel that has been the unlock for us. But I feel like each year it's finding those opportunities to grow. And I think being a cash-strapped startup, we've been forced to figure out creative ways to grow outside of massive spend on digital marketing. You mentioned that SEO is a big part of it as well, and that often you'll actually outrank the winemakers themselves with your page. Talk a little bit about how you've thought about SEO and how it's helped you grow. Yeah, we, my background is actually in digital marketing and performance marketing. So I also just nerd out on, on learning about SEO and other digital marketing areas.

26:42Sarah Hoffman:And from the very beginning, we really wanted to own canned wine. So that's been a key where we put a lot of focus into and we're really capturing a lot of folks that are searching for best canned wine for canned wine. We also really found a lot of interest around zero sugar, low sugar wines, like health terms, which I'm personally passionate about because I think a lot of wine companies use some of those terms irresponsibly. And I really like to educate around those terms and how wine can naturally be low in carbs and sugar. And yeah, we have a very healthy set of blog articles that has helped us to really rank for specific terms.

27:31Sarah Hoffman:And we're a really small team, a mix of terms that, a mix of articles that are written by us and by AI. and you know we sometimes have really interesting articles take off one of our top drivers to the site for a while was a wine versus white claw article I wrote in 21 or 22 and basically highlighting that looking at wine and spike seltzer I think wine wins for a variety of reasons and written in kind of a humorous tone. And we got, you know, we got a lot of discourse and interest around that. And it still drives a lot of traffic for us. I feel like when you're drinking White Claw, when you're on the Claws, there are no laws, first of all, I've heard.