The Return on Investment (ROI) of a Blog

Over at the Marqui Software blog they have some great feedback for the popular question: What is the ROI of having a blog?

The case study they point to is from Stormhoek, a South African winery who marketed the launch of their new white wine through blogs and online word-of-mouth advertising. Essentially they invited a bunch of bloggers they thought were a good fit for the product launch to try to the product. Free wine? Quelle tough sell.

The venerable Telegraph called the story A very fruity sauvignon blog and did a fantastic job writing it up in their business pages. After an intro pandering to their audience, they get down to the How They Did It:

Last May, six months after Stormhoek launched, Dymoke-Marr despatched a bottle of his mid-price Sauvignon Blanc to 150 of the UK’s most frantic-fingered “bloggers”, the burgeoning community of internet diarists.

It was a plan that didn’t lack bottle. After all, since their emergence at the end of the 1990s, bloggers have become a nightmare for businesses the world over. Microsoft, Tesco and McDonald’s have all fallen victim to vicious blogs written by irate customers or seething employees.

But Dymoke-Marr’s gamble elicited barely a sour grape. “We were just really honest,” he says.

“We didn’t say we were selling the best wine in South Africa. We just said: ‘Here’s a nice wine, reasonably priced, tell us what you think.’ “

The bloggers got to work, tapping away about the virtues of the vino. Estimates of how many bloggers there are around the world range from 15m to 30m. Up to 80,000 blogs are thought to be started each day. If you had punched Stormhoek into Google last June, 500 references would have popped up. That figure stood at about 85,000 last week.

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Of course, anyone who doles out free booze might expect to get a good write-up. But the pith of the Stormhoek story is that the chitchat in the virtual world has generated real sales.

Since last summer, monthly sales of Stormhoek’s bottles have doubled. It has won contracts with J Sainsbury and Majestic Wine. The internet dialogue has also led to greater demand from retailers such as Asda and Threshers with which Dymoke-Marr already had contracts.

Stormhoek now accounts for 20 per cent of all South African wine sold at above £5 a bottle in the UK.

“Blogging has been really, really fundamental to what’s happened over the past year,” Dymoke-Marr says. “Our retail buyers say customers go into their stores and supermarkets and say we’ve heard about this through blogs.

“But it hasn’t just seen our sales rise strongly, it’s totally disrupted the business and completely changed the way we think.”

Hmm. So this blog thing seems to have caught on.

Are you interested in how your company can capitalize on blogs and the market forces of the web? Well we’re interested in helping you do that. Contact us and and we’ll get to work.