Sfriso winery, located in Chiarano, Italy, in the province of Treviso Veneto, was informed on February 23, 2020, that it could no longer operate normally. The winery was closed down indefinitely and immediately, with no tourists allowed to visit for tastings. The winery was placed under an official lockdown after the Coronavirus spread across the province. It is now designated as a COVID-19 red zone. The province was the first to implement the most severe restrictions, two weeks ahead of the rest of Italy. The sudden and unexpected quarantining in the North of Italy led to a strict lockdown to be implemented on March 9, 2019. Reka Haros and Pier Sfriso were left stunned by the impact of this sudden and unexpected quarantining in northern Italy.
The Sfrisos react to the directive in this video. Sfrisos were yet to be affected by the commercial restrictions. In the weeks to come, things would get worse as businesses were not given clear advice or support. Italy was the very first European country to close its doors. Other countries viewed it as a pariah, and there were no guidelines on how to handle the crisis. Sfrisos found themselves in a crisis. They were not prepared and did not have a backup plan to prevent a commercial catastrophe.
Life at quarantined Sfriso Winery Day 1: Trying to remain positive
Sfriso Winery: The crisis it faces
Sfrisos increased its sales commitments as COVID-19 spread around the globe. They also took stock of the wine they had in stock. The COVID-19 pandemic presented an immediate challenge, as it limited the distribution channels through which wine could be purchased. Before the Sfrisos had a chance even to consider a solution, an impending crisis was brought on by a force major refusing a distributor to commit to purchasing 6,000 bottles of Prosecco. Maintaining cash flow is essential for small businesses to remain commercially solvent, as any financial expert can tell you. The potential financial deficit posed by this cancellation of accounts receivable, coupled with the uncertainty about future sales caused by the pandemic, was a serious threat to the viability and survival of the business.
Sfrisos looked forward to the summer of 2011 with great anxiety. The predicted loss of tourism would exacerbate the immediate financial impact of a pandemic. In the absence of a viable solution, this forecasted loss would be at least 70% of the typical sales between March and September.
The Coronavirus pandemic also made it impossible to plan, as it affected commerce around the globe. The government did not provide any support, and it was not a long-term solution for any business. Even worse, it was not clear when things would return to normal. Reka remembered:
The rules of the game were constantly changing. We knew two things: the harvest was on its way, and we had 6000 unlabeled bottles of Sparkling Prosecco DOC in our inventory. We only had two guarantees and needed to find some way to sell these bottles unlabeled to maintain our economic stability.
Sfrisos considered all the possible options available to recover the immediate sales loss they were facing.
The decision that saved the business
Sfrisos was aware that they could not sell enough bottles to their existing clientele, regardless of how loyal they were. To recover any potential revenue loss, the Sfrisos needed to find new customers quickly. Sharp (2019) showed that brands grow through the acquisition of new clients. Reka wondered, “How can a winery without a marketing budget gain new customers in the current crisis?” She remembered:
The shock of the pandemic left us feeling numb, unable to implement our 2020 plans. But reality soon set in. We realized we had to be intentional about acquiring new customers. We shifted our focus to stable, concrete decision-making. We needed something we could hold on to and not be too susceptible to unexpected changes in the business environment. We decided to toss out our marketing and business plans for 2020, and do something else to adapt and respond to the new crisis. The6000Project was launched.
Naidoo (2010) explains how this initiative is applied through research findings that show that SMEs with a marketing focus have a competitive edge based on cost-leadership or value proposition strategies. Evidence also supports the research findings that businesses with a focus on domestic markets recover from economic crises more quickly than those with a competitive advantage in export markets. (Medrano & OlartePascual 2016) . Further, SMEs with a strong emphasis on competition and inter-functional abilities performed better than those without these organizational features. A winemaking husband and wife team perfectly met these criteria.
Reka saw this as an opportunity to innovate, and she drew on her experience working in advertising. She recognized that the winery needed to reach out to a new audience online and quickly. Reka remembered her attitude at the time.
Why not give designers who love Prosecco the chance to “do whatever they want” with the label? These bottles did not have a front label, so there was an opportunity for something innovative online and via social media. We could launch a competition for a limited-edition 2020 Prosecco label. The contest would be hosted online, and social media would be used to promote the winner. Label that represented both the harshness and hardness of 2020 but also the joy of saying goodbye.
The digital solution was the obvious business solution for the pandemic. It included everything from a platform to a concept.
Reka and Pier, who had just completed 100 days of lockdown, were growing more concerned about the spread of the pandemic. It was unlikely that the world would return to normal anytime soon. Tourists wouldn’t be returning to the area, and on top of that, they realized the loss of revenue from the absence of sales in the winery. Inventory and the Internet were the only things that could provide stability. The 6000 Project was born out of this realization. It was launched as a way to keep Sfrisos going through 2020 while allowing creativity to flourish. The owners of the bottles that were canceled saw the opportunity to create a limited edition label for 2020. They wanted to represent the harshness and harshness of 2020 but also the joy of saying goodbye. This video shows Reka and Pier discussing the launch of The6000Project.