The subject says it all and I’m interested in how some of you would approach this.
Fairly popular wine, IMO, that I am a member of their wine club and recently received an offering for one of their wines via an online retailer for approximately $5 less than wine club members are able to purchase it. Sure this wine can be found in some retailers but it generally sells out quickly from what I have seen.
How would you handle this? Should I broach the subject with my contact at the winery? Ignore it?
Seems a crappy thing to do to undercut your customers.
99% of the time retailers will be cheaper than buying from the winery at their MSRP. If you’re a club member, do you not get discounts?
Wineries choose to charge more than retail so that they’re not overly competitive with their distributors but it seems pretty easy to get discounts from wineries, at least on bulk or on memberships.
I actually only know of one winery (Stony Hill) where it is cheaper to buy from the winery versus at retail. Of course this is excluding highly collectible wines that fetch premiums at auction.
It seems like the $5 might be worth paying so that you have more consistent access to the wines versus a sporadic access with a slightly lower price.
David these issues can be annoying but it may not be the wineries fault.
There are several different reasons that the wine ended up at a discount-flash site, anything from the distributor in that area went out of business or lost the ‘brand’ so they dumped it, sold a large parcel for cheap and recouped some of their investment, being just one example.
If the wine generally sells out pretty quick, I would say it probably wasn’t the winery that ‘dumped’ the wine as they would have no financial reason to.
Wholesaler may have “closed out” the wine for some reason. I am occasionally stunned by distributors liquidating stock at pennies on the dollar. Large distributors in particular will cut deals that seem stupid to me, but make sense at the larger scale on which they operate. Jack Daniels covers a lot of mistakes for the big guys…
Retailer may have decided to sell the wine on a thin margin. A winery can try to dictate a minimum price, but not much they can do on that front at the end of the day. Once the wine has left their hands, they have no control other than trying to pull the wine from that particular channel for future releases.
Put another way, if you went in commerce corner and saw the wine for sale for less than you paid, would you blame the winery?
There are so many factors involved, but I would reach out to the winery directly if you are concerned - they should hear from you as a wine club member that is potentially dissatisfied.
I know that when I offer my wines on woot for instance, I reach out to my club members and let them know in advance and offer them a similar deal to purchase directly from me if they’d like - it’s the right thing to do IMHO.
In isolated cases, I wouldn’t worry about it or be annoyed at the winery. They can’t control the price that a given retailer may sell their product. Particularly if it’s just $5/bottle.
But many wineries regularly gouge their direct customers well above retail pricing, particularly some of the big, generic ones. To those, I’d just not buy directly and buy from retail instead, if at all.
A few things are not made known: price of the wine and if free shipping applies to either the winery/club or the retailer. if the wine is $15, maybe a 33% discount would warrant at least the inquiry. If the wine is normally about $50ish I would not lose the sleep. I see it from time to time. In one instance it was the changing of the distributor that left the old distributor with inventory and they were no longer tied to the winery and could do what that wanted with the balance of stock. It did not make the winery happy but what cold they do? (it was a $39 pinot selling for $29 – a 25% discount). He who backed up the Murano did ok.
Cheers!
If I read it correctly, he is saying his wine club discount is not as attractive as this retail offer.
At first glance I may be bothered by this, but sometimes cash flow or other reasons force a winery to do a one-time purge of inventory. I’d be more bothered if I can regularly find a retail price near my wine club price. *Edit: And as others have said, a winery can’t always control what the distributor does.
Happens all the time. the VAST majority of wines that I’ve seen available for purchase at a store are usually priced lower than what the winery has them listed for. Club, list whatever… Again, this is retail I’m talking about, but with online sites we pretty much see the same.
There are several threads on this. Wineries don’t want to undercut retailers, so they charge something that equates to a MSRP, which allows for a higher markup than many retailers take. Then there are distributor deals that can add to the price difference. If wineries charged less than everyone else, why would any retailer in a state that allows DTC shipping carry their wines and look bad? $5 is really no big deal. You can say it’s the principle of the thing, which only makes you feel bad, or you can be pragmatic and not care about the small price difference, or you can contact the winery and see what they say. I’d go with one of the two latter options. You say, “Seems a crappy thing to do to undercut your customers.” Well, retailers supporting their brand are their customers, and you’re right that they don’t want to undercut those customers.
This happened to me the first large purchase I ever made from Arnot-Roberts, 2006 Syrah if memory serves. I paid X and Wine Library 4-5M later had the bottles at ~ .75X, Duncan wrote me a nice note in explanation and I got over things.
Sadly didn’t reload from WL, sure would like some more 06 A-R Syrah living up here on the beach!
Look what happened when a wholesaler unloaded a palate of Bevan wine to Costco. The winery cannot control what retailers do once the wine hits 3 tier. That’s why a lot of producers market direct and do not distribute through retail. Deep discounts offered by some places hurt brand value for the winery.
One way to look at it is if one has so much wine left over when the new vintage hits perhaps he/she is producing too much. Either that or mot marketing sufficiently.
Personally I will buy direct from mailing list to ensure I get the wines I want. Not everything shows up on retail shelves, regardless of price.
What Brian said, plus provenance. However, if it happens consistently, I change my buying patterns.
A great example is Shafer Hillside. In most vintages where it “only” scores a 95 or 96 it is easily available for less (often as much as $50 a bottle). But try to find the perfect 100 vintages and it gets harder and more expensive. Is it worth it for that to stay on the list? That is an individual choice.
I understand this is the logic that is used. I wonder how much of it is reality, though. What percentage of wine gets sold through non-wine-club-member purchases direct from the winery? In other words, what percentage of people who buy wine off the shelves in retail stores stop first and see if they can order it more cheaply direct from the winery? For example, how much less Rombauer Chardonnay would Total Wine sell if it turned out Rombauer were selling it on their website for $5 less?
Maybe as to a certain tiny subset of wines, and a certain tiny subset of wine buyers, but I’m guessing the effect is little or nothing in the large majority of cases. Am I wrong?
They might happen to notice the online pricing later. It isn’t worth taking the chance. Some customers get upset about the darndest things. Many people are likely to generalize and think that retailer must be overcharging on everything, not bothering to find out, and never go back. Many wine buyers for retailers are well aware of all of this and wouldn’t want to take the chance.
I appreciate the responses and they are well reasoned. Still new to this so I fully understand. I am adding to my next shipment and will drop a note in about this and my thoughts. Thank you all again for the responses as they have given me new perspective on this.
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