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2 0 V I N E YA R D & W I N E RY M A N A G E M E N T | J u l y - A u g 2 016 w w w. v w m m e d i a . c o m that your social network won't gen- erate even 50% of your goal." As campaigns are only 30 to 45 days in duration, promotion needs to be fast and furious. The Barbers issued a press release about their campaign that was picked up in local papers, ran Facebook ads, and distributed cards with QR codes linking to their campaign in wine bars and retail stores that permitted them to do so. Like Hermit Woods and Smith Story, Barber Cellars' campaign got immediate support in the begin- ning, followed by a lull period with few contributions. The end of the campaign ushered in a flurry of support. Hermit Woods raised one- third of its funds in the last two days of its campaign. According to Krowdster, sustain- ing interest and momentum is the reason for keeping the campaigns short. Wineries also need to prepare for the expenses associated with a campaign. Barber estimates they spent $1,000 in spreading the word through Krowdster, Facebook ads, press release distribution and such. The rewards for contributors rep- resented additional costs. Among other items, the Barbers invested in a custom grape leaf design treat- ment for a wall in their tasting room that features the names of each contributor of $300 or more. Manley estimates that Hermit Woods spent between $3,000 and $4,000 on a variety of rewards sent to contributors. Although, along with Barber and Smith-Story, he reports that a good number of peo- ple didn't opt to collect a reward. INVESTMENT CROWDFUNDING While crowdfunding has worked for some wineries, others are skep- tical of its true impact. "There are two kinds of crowdfunding: r e w a r d - b a s e d a n d i n v e s t m e n t - based. Investment-based is where I believe the opportunity lies," says Michael Brill, CEO of Cruzu, a crowdfunding service that directly connects wine buyers with wine- makers who are looking to fund specific projects. Unlike Kickstarter donors, the contributors are essen- tially pre-buying wine. "The idea behind Cruzu was that people would be funding winery projects that wouldn't have hap- pened without their involvement," Brill explains. "What I've found is that it doesn't work so well as a generalized model." Brill, who founded Cruzu a year ago, says while the company has done about 20 projects, some as large as $60,000, it hasn't been a game changer. "To get to the point where crowdfunding really moves the needle, wineries have to drive the projects themselves." The Cruzu team found it was tak- ing on the storytelling, video pro- duction and promotion for each and every winery campaign. "The chal- lenge with that is it doesn't scale. If Kickstarter had to do it all, it simply wouldn't work," he says. While Cruzu did $250,000 in business in its first six months — and is projected to do the same in the next six months — it's now a part-time endeavor for Brill. Where Brill sees true oppor- tunity in the wine industry is in offering consumers a piece of the action. "Consumers want to be a part of the winemaker lifestyle. And what wineries need is money," he says. "What if there were a way for a consumer to spend $2,000 to $5,000 to either own a small piece of a winery or get returns based on a winery's success? "The consumers wouldn't only get a financial return on invest- ment, but also a wine discount they could share with friends and fam- ily," he says. "This works because it provides a financial, experiential and product return." Jennifer Strailey has covered the food and wine industries as a writer and editor for 20 years. Her experi- ence also includes public relations work for wineries and vineyards in California, Argentina and Italy. She is a contributing editor for Progressive Grocer magazine and is V&WM's Spotlight/NewsFlash editor. Comments? Please e-mail us at feed- back@vwmmedia.com. WINE WISE MARKETING JENNIFER STRAILEY