Mike Provance | Innovating in a Highly Regulated Industry
Mike Provance
Smart Business Revolution

Mike Provance, PhD, is the CEO of 3×3, a marketing technology company focused on modernizing how brands and liquor retailers uniquely engage and sell to the independent channel consumer. He is a serial entrepreneur, author, and speaker on technology model innovation and new venture management. 

Mike is also a digital technology strategy expert. He has built groundbreaking technology businesses and launched award-winning digital properties for over 30 years in financial services, information services, manufacturing, and healthcare industries. He has even worked with the US Navy and US Special Operations Command. Prior to that, he ran early-stage investments in computing and medical technology for the Ben Franklin Technology Partners. He holds a PhD from George Washington University, an MBA from Penn State, and a BS in Management Science from MIT Sloan School of Management.

Mike Provance, the CEO of 3×3, joins John Corcoran in this episode of the Smart Business Revolution Podcast to talk about the impact technology has had on innovation in the wine and spirits industry. Mike talks about some of the challenges sellers in the wine industry face, how he helps retailers within the industry grow and find new customers, and his thoughts on working in a heavily regulated industry. Stay tuned.

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Here’s a Glimpse of What You’ll Hear:

  • Mike Provance’s journey into the wine and spirits industry
  • The challenges beverage brands face — and limitations of doing direct-to-consumer sales within the industry
  • How does technology impact the supply chain system and customer buying habits in the wine industry?
  • Strategies small retailers can use to compete better with bigger retailers 
  • Mike explains how he built a network of 2,000 retailers across the country — and the sweepstakes project he’s currently working on
  • Mike’s thoughts on working in a heavily regulated industry
  • The people Mike acknowledges for his achievements
  • Where to learn more and connect with Mike Provance

Resources Mentioned:

Sponsor: Rise25

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Episode Transcript

Intro 0:14

Welcome to the revolution, the Smart Business Revolution Podcast where we ask today’s most successful entrepreneurs to share the tools and strategies they use to build relationships and connections to grow their revenue. Now, your host for the revolution, John Corcoran.

John Corcoran 0:40

All right. Welcome everyone. John Corcoran here. I am the host of this show, and I get to talk to so many great CEOs, founders, entrepreneurs of all kinds of different companies. Go look at my back catalog of past episodes. There are some great episodes back there. I’m also the co-founder of Rise25, where we help to connect b2b business owners to their ideal prospects. And before I introduce today’s guest, a quick shout out and thank you to our client Alexi Cashen. Check out her show The Alexi Cashen Show. She introduced me to today’s guest and absolutely raved about the depth of his knowledge. And when you hear about his educational training and background, you will not be surprised. Mike Provance, PhD, is a serial entrepreneur, author and speaker on technology model innovation and new venture management. He’s the CEO and he leads 3×3, a marketing technology company focused on modernizing the ways brands and liquor retailers engage and sell uniquely to the independent channel consumer. With all the changes that are happening in retail, it’s a really interesting area of the market right now. 

He is a digital technology strategy expert. He’s built groundbreaking technology businesses and launched award-winning digital properties over 30 years in financial services, information services, manufacturing, and healthcare industries. He’s even worked with the US Navy and US Special Operations Command. Prior to that, he ran early-stage investments in computing and medical technology for the Ben Franklin partnership. He holds a PhD from George Washington University where fun fact, I was born. He also has an MBA from Penn State, and a BS in Management Science from MIT. And, Mike, a pleasure to have you here. And tell me, you know, we were talking and chatting a little bit beforehand. You know, you worked for the US Special Operations Command, you worked on some projects that had to do with the Mars missions, and now you’re in the wine and spirits industry. How did you get from there to here?

Mike Provance 2:37

Great, great question. And the answer really lies in the fact that my most of my career and working with startups and new ventures and new technologies revolves around how do you innovate in regulated environments? So if it’s a, you know, regulated and sensitive, military regulated and sensitive healthcare, and the beer, wine and spirits industry is the epitome of a regulated industry? That goes back decades?

John Corcoran 3:05

Absolutely. You know, when I was practicing law, I remember looking into it for a couple clients. And there are the three-tiered regulations, which is if you look into the history of it, it seems a little bit baffling probably to today’s present-day consumer. But it has to do with back when the mob ran alcohol and controlled alcohol distribution.

Mike Provance 3:26

Essentially, it was ensuring that the mob couldn’t own the whole industry. And it gave the federal and state governments ways to put protections in place to make sure the industry stayed aboveboard.

John Corcoran 3:41

This is probably a huge question. But what sorts of challenges from a technology marketing standpoint, does that antiquated system that we have in place? What sorts of challenges does it create for the companies that you work with?

Mike Provance 4:00

But the biggest challenge is, imagine an industry where you manufacture a product, but you’re actually not able to do anything directly with the retailer to incent them to sell your product versus someone else’s product and market, that you have to work with a distributor who pulls in products from a lot of other manufacturers. And the distributor job is to then get that product on the shelf. And the retailer has to get customers to come in the door and buy products and the retailers are focused on selling but they’re not necessarily focused on selling your product. So in this industry brands can’t induce retailers to promote their product over another product. Right they have the retailer has to be able to operate fairly and freely across all the products. distributors can do things in terms of discounts and coupons and do create incentives. For the retailers, but it really limits the ability of the brand to influence a retailer to influence consumer’s decision making. brands can go on for a run, run Superbowl ads to reach consumers and hope to get them to walk in a store and buy the product. Which works if you’re, you know, a large company like ABN Bev or Gallo or someone enormous. But if you’re a small manufacturer of being able to drive the right consumers into your store is a very difficult proposition. Because the tears are so locked down. 

John Corcoran 5:36

So there’s been this whole huge movement towards direct to consumer for brands for, for companies, manufacturers over the last, you know, really 20 years or so. And it and for wine and spirits, that there are real limits to the extent to which they can do that.

Mike Provance 5:58

Well, yeah, and the wine industry actually, for many years now has had the ability to sell direct to the consumer. That’s why you’ve seen, you know, even dating back several years, the proliferation of wine clubs and the ability to sell and deliver wine to the home. Those were provisions that came through federal law that enabled it to occur. More recently, the Supreme Court has started to level the playing field so that other categories like beer and spirits can start to do the same. But because of the tight house rules in the way that the laws are structured, every state sets its own rules about what’s allowable, which means if you wanted to be a, a tequila distributor, and send products to anyone in the country, you’d have to navigate each state’s laws, and then try to can, you know, basically take the Supreme Court ruling, and take that into the local into the state level and try to convince the state to change its rule. So we have a long way to go. But the reality is, even with direct-to-consumer, retailers are still and will be, for the longest time, a predominant source of how shoppers find products. So there’s no there’s directly consumers great for some products, it’s very hard to discover new products without being able to talk to somebody and that’s where the retailer’s specialize,

John Corcoran 7:28

right? And is technology making it easier for these companies that do want to sell in multiple states to do so in spite of all the different regulations and different standards.

Mike Provance 7:38

It definitely is, I think, you know, you asked why I got involved. One of the reasons that I got interested in this industry was the technology actually now with the state of it today can enable us to navigate a lot of complexity, and simplify a lot of complexity. That maybe 10 years 20 years ago wouldn’t have been a doable proposition. So technology is absolutely helping it but it’s, it’s a long and complex road to get there. So you even now see, technology really solving point problems along the supply chain of the industry. There’s not an EIRP system that can solve the entire supply chain in one whole swoop. Because of that, you know, multiple jurisdictions, multiple categories, multiple tiers, you know, when you start doing the matrix algebra that it starts to get to become a very complex math problem to solve.