There are stringent regulations concerning marketing and advertising campaigns for brewery and distillery start-ups. And as these regulations vary from state to state, it’s vital to be aware of the many different rules this sector has to face regarding beer distillery incentives or consumer rebates.
To ensure total legal compliance with these regulations, implementing solutions is essential before initiating any customer rebate or sales incentive program.
Here at Incentive Insights, we have successfully assisted companies in various industries in managing their rebate programs. And we have helped many breweries and distilleries with their marketing efforts, leading to significant sales increases.
What Are Alcohol Control States?
Here are the main differences regarding regulations relating to distributing and selling alcohol in control and open states.
How Are Control And Open States Different
In alcohol control states, the distribution and sale of wine, spirits, and beer are owned and controlled by the state. On the contrary, open states allow businesses to buy and sell alcohol as long as they conform to state regulations.
Government agencies handle all aspects regarding the wholesale and distribution stages of alcohol in the control states. Many control states also own the off-premise retail element in the form of ABC (Alcohol Beverage Control Board) stores. The price to consumers is determined by the state, which sets the minimum price for each product.
The revenues earned by the state from these stores help support alcohol programs. It promotes moderate alcohol consumption, which benefits the local community.
On the other hand, open states allow private entities to handle the sale and distribution of alcoholic beverages, but state legislators monitor this. This is attained by granting licenses to private enterprises to buy and sell alcohol at the state’s discretion. A license permits them to deal with diverse retailers. And as they can trade with liquor stores, they can offer consumers a large selection of beverages.
List Of Control States
At the time of writing this blog in mid-2023, there are 17 control states where the state government controls the distribution and sale of alcohol rather than being handled by the federal government.
These are Alabama, Idaho, Iowa, Maine, Michigan, Mississippi, Montana, New Hampshire, North Carolina, Ohio, Oregon, Pennsylvania, Utah, Vermont, Virginia, West Virginia, and Wyoming.
Getting Listed In A Control State
Before being allowed to sell your product in a control state, it must be listed by the state. But be aware different states have different requirements.
Register Your Products
Product registration is compulsory in all control states.
This is done through the National Alcohol Beverage Control Association (NABCA). A Control State Code is issued, a unique six-digit code accepted by states that have adopted the control state coding system.
In some states, brand managers must obtain a Control State Code before a product can be sold. Other states issue a state code when the product is already being marketed.
Alcohol brand registrations are overseen by the Alcohol & Tobacco Tax & Trade Bureau (TTB). Documentation is required regarding where the product is made, its ingredients, alcohol percentage, product age, and a barcode.
Evidence Of Market Demand
To establish interest in the control states, large and small craft breweries need to establish strong marketing campaigns to enable them to reach their target audience.
Craft beer brewers and wine and cider makers need to be aware of the competition in the area, which competitor is the most successful, and why.
A good marketing strategy will help brewery owners understand the local dynamics and increase product appeal to customers.
Offering incentives as a test of whether there is a demand for a product is an excellent go-to-market strategy for all types of businesses. But there are restrictions in control states that may limit the type of beer distillery incentives offered, and it’s vital to get legal advice before planning such marketing efforts.
Achieve Product Listing Status
A product has to sell well and be sought after by other retail customers in the state before it is eligible for product listing status.
A broker may then need to present the product to the state board for approval formally.
Once approval has been given, a business has full listing status. The alcoholic beverages can be stored in the ABC warehouse while awaiting shipment to the retail liquor stores.
Establish A Rebate Program
The success of a marketing approach depends on the type of rebate program used. Here is a refresher on what are rebates in how we define it.
Here are some relevant programs to check out to tailor a program to the purchasers’ needs.
The rebate form is generally found in or on the product packaging when purchasing a product with mail-in rebates.
Shoppers are eligible for rebates when they return the filled-out form and provide the company with proof of purchase. At Incentive Insights, we can also offer convenient online submission forms that create a faster and more customer-friendly experience.
This is an effective way for craft breweries to promote their products and give consumers a beer distillery incentive to buy from them.
Such rebate programs permit companies to collect information on the customer. This information can be added to their database for marketing purposes.
For breweries and distilleries already working with significant alcohol distributors, there is an option to run sales incentives directly with those distributors or supplier incentive programs. You can design a program that offers distributors rebates if they hit specific sales targets.
They are incentivized to find clever ways to achieve higher sales with retailers through better product placement and promotion. Rather than dealing directly with multiple retail stores, the distributor can use their network to achieve this with less effort on your marketing team.
Retailer rebates are a successful way for manufacturers to encourage retailers to stock their products. A manufacturer could offer a retailer a tiered rebate incentive such as a 1% discount on purchases of 1,000 items, but they could qualify for 2% when purchasing 2000 items. This tiered retailer rebate system encourages the purchaser to spend more, ensures your customer’s return, and boosts brand loyalty.
Additionally, such rebates allow the retailer to promote a product in a way that increases interest and foot traffic, which ultimately increases sales.
And beer distillery incentives also help with developing customer loyalty.
Find Out How An Efficient Rebate Process Can Help Your Marketing Efforts
An efficient rebate process is essential to a marketing strategy for a company to be successful. But it’s also time-consuming to gather information and analyze current market demand.
At Incentive Insights, we offer customized rebate processing services. This includes collecting consumer data, handling rebate data, fulfillment, and managing innovative rebate solutions to increase sales.
Contact us to learn more about how our cutting-edge techniques can help your marketing process and make your company more competitive and customer friendly.
Nathaniel Smathers, a contributor to the Incentive Insights blog, brings a fresh perspective on business strategies and market trends. With a background in marketing and a passion for data-driven insights, Nathaniel offers a unique blend of expertise and creativity. His approach to dissecting complex market dynamics and transforming them into actionable strategies makes him an invaluable asset to our team.