Solving Complex Problems with Shopify Plus

The Client: 

Gold Medal Wine Group was established in 2023 as a merger between several legacy wine clubs. The newly formed corporate entity also directs several non-owned properties with similar business models in the beverage space. Managing a portfolio of brands with similar operating structures within the same industry quickly revealed a critical need to simplify account management and remove redundancies, both operationally and financially.

The Challenge: 

Effigy Agency was introduced to Gold Medal Wine Group in late 2023 as part of a greater technical enablement initiative. While navigating multiple platform migrations and complex subscription management implementations, we also started the process of consolidating the new portfolio of Shopify storefronts under one agreement that would enable Shopify Plus for all brands and help reduce operating overhead.

The Process:

First, we assessed internal options and aligned with management on priorities and timelines:

1. Minimize expenses across the portfolio for account structures.
2. Unlock Shopify Plus for all portfolio brands to enable a broader toolkit and more customizations for every managed brand.
3. Maintain flexibility within the portfolio to respect future changes, mergers, acquisitions, or divestments that might modify the composition of the portfolio without losing those features or requiring a renegotiation at each inflection point.
4. An agreement can be implemented as soon as it’s approved.

Then, we started the conversation with Shopify Plus. This involved several rounds of discovery, creating projections for portfolio performance, and exploration of other pieces of the business to help create a complete solution.

Some of the key questions that became important:

• How are payments being processed? Because not all brands were using Shopify Payments, this made a big difference in both the total cost savings impact via merchant fees, as well as the internal timelines for migrating those payment processing systems and evaluating new brands to include.
• What is the total projected portfolio revenue? This became an exercise in finding the right balance of established portfolio properties and recently established initiatives to help assess where total operating expenses could be mitigated and distributed. To further complicate these models, each business had different seasonal factors and their own individual corporate sales programs.
• How is the overall composite going to be managed? Because we were handling multiple operating and ownership structures, appointing a central account owner and delegating explicit permissions across each property quickly became a critical decision that impacted all parties.

‍The Solution:

The negotiation process took 5 months to navigate, with several different solutions presented. After extensive deliberation and several iterations, the final solution included both the owned and operated properties under a single master Shopify Plus agreement with a modified billing structure that enabled Shopify Plus for all participating properties at a significant discount.

Additionally, the agreement included negotiated payment processor savings for all participating brands, including Shopify Payments, 3rd party payment processing systems, and corporate sales. Across the portfolio, this reduced transaction fees by 13% without any additional infrastructure changes. With a long-term goal to migrate all properties to Shopify Payments, those savings were also designed to scale with growth for each portfolio property, enhancing long-term value and future-proofing the business model as a whole.

After the agreement went into effect, every brand was able to enhance checkout with revenue-generating customizations like in checkout upsell and dynamic shipping language for subscription customers.