I just don’t understand the business model or why you would ever buy direct from the majority of wineries. In the last month I have received several order forms/releases where the wine is at a 15-20% premium to what I can purchase the current vintage at the local store. There is nothing more frustrating than to purchase wine direct and then find it in retail for quite a bit less. Example, Paul Hobbs To Kalon 2009 is $275 plus $9 a bottle shipping from the winery and locally I can get the 2008 for $225. Are people just fishing for the 99-100pt? Is it the need to be the first to get the wine? It would seem that being on a list would allow an individual to get a much better price. Why else be on a list?
Why else be on a list?
Good question. The only wineries I buy direct from are not available retail.
First, I can’t believe anyone would pay $275 for Paul Hobbs to Kalon. Anyway, there are a variety of different reasons to be on a list. Scarcity is probably the biggest reason. Some ppl want bragging rights, some ppl like the wine, some ppl flip…but it all revolves around the idea that the wine is difficult or impossible to get in retail. If the wine is readily available after release and cheaper, then you’re right, there is no reason to buy direct. In fact, kinda dumb to buy direct if the wine is cheaper elsewhere and easy to find.
Provenance? Fostering a relationship with the winery, winemaker, etc.? Easier access to limited wines and large format bottles?
Well . . . . I guess this depends upon the specific winery, but here’s what I expect others to say about why to purchase directly from a winery, even with this situation:
- You are assured of better provenance from the winery
- You are supporting the winery directly
- These are ‘isolated instances’ and we have no control over it’
- By purchasing from us, you are able to get things that you wouldn’t normally get - like 100 pt wines
Blah blah blah . . . .
Wine club members should be treated like kings and queens - period! These should be considered your best customers and should be very well taken care of, and should NOT be taken for granted.
There is always the possibility of seeing your wines at retail lower than what you offer them to your wine club members due to atypical circumstances, but I would certainly pick up the phone or email those wineries and let them know how you feel about it. Without doing so, they may simply feel that there are ‘no issues’ and continue to do the same in the future.
I know with my brand, on the few occasions that my wines have been offered on Woot or somewhere else, I let my club members know in advance - and give them the opportunity to either match that price or offer them a better price . . .it just seems like the ‘right’ thing to do.
Interested to hear other thoughts on this.
Cheers.
Working for a retailer which often sells back vintages for less than the current release, I see an interesting side of the business. We get angry calls from wineries all the time because of our pricing, while other wineries buy from us to refill their library. The reality is that the market speaks for every wine that leaves the cellar door. Some wines are desirable on the open market and the price can skyrocket from mailing list price, while many can’t support even 50% of the original winery asking price.
Short of a very select group of wines that sell above mailing list price - that list is much smaller than it used to be - mailing list/club members are paying for the opportunity to have direct contact with the winery, go to club events, have full access to the winery’s catalog, etc. Buying directly from the winery (especially in Napa) is almost never a great value proposition.
One thing that often gets forgotten is that there is a class of wealthy person who regards running around trying to save $25-$50 (or whatever) a bottle simply not worth the time or effort compared to having a favorite winery’s wine show up automatically. I am not saying they are right or wrong, simply that they value different things.
When I ran a very large restaurant wine program a few years ago, I remember reading threads about restaurant pricing and how much it sucked and thinking about the type of guest who would come in and without thinking throw down $200-$500 a bottle, again without concern. Some of them seemed to regard the high price as part of their enjoyable wine experience. Not how I would roll, but that person exists.
Many people don’t regard the thrill of the chase or bargain-hunting as a pleasure. For wine geeks who love it, that can be difficult to comprehend.
It is good to hear you are proactive. It is totally understandable if there is an occasion where the wine is blown out and found at retail for less. I actively buy directly from multiple wineries but have also dropped quite a few after being burned. It seems that there would be a big incentive for the wineries to have a loyal mailing list : selling futures at discounted or wholesale price gives operating capital and loyal mailing list clients are an excellent source for referrals/advertising.
What triggered this was the RM offering today and the decision to buy was an easy one.
The problem with that rationale is that mailing list customers can be fickle, esp on lists that have been made by glowing reviews. If the scores drop, the mailing list people can drop and, if you’ve been selling at a discount and thus competing with your distributors and retailers there might be bad blood there. It’s a delicate balance.
I can see other reasons aside from price to be on a mailing list, mainly assurance of getting the wine. If the wine is readily available at retail for list or below, eh. But some lists sell out and the wines aren’t around at retail or aren’t around for less that list (flippers, etc). I don’t buy the provenance argument - as long as shipping to the retailer happens during cool weather I can’t see the extra few steps adding much risk and, frankly, I’ve read enough horror stories of wineries shipping, on purpose or inadvertently, during fall heat that provenance doesn’t really hold much weight as a reason to buy from the list.
I think there are an assortment of reasons, usually a few but not all of which apply to each given winery-customer relationship:
** you get lower prices than retail (e.g. Screaming Eagle, Quilceda Creek, Kosta Browne, Rhys, Saxum). There are relatively few in this category anymore, but there are some where it would cost substantially more to buy the wines at retail or auction than directly from the winery.
** you want to buy larger quantities and/or a wide selection from that producer and you want the convenience of not having to cobble it together from assorted retailers (as Jim Coley explained)
** impulse decision while visiting the winery and swept up in the moment
** want the secondary benefits of being a direct customer (free tastings, tours, winery events, barrel tasting, getting to hobnob with the winemakers, being treated like royalty when they visit, etc.)
** wineries where there is little or no retail availability of the wines except directly from the winery (e.g. Scherrer, Dehlinger, Arcadian; plus lots of very small wineries without much retail distribution fall into this category even if they’re not necessarily in high demand)
** particular fondness for the small side projects of a larger winery (e.g. quirkly little rose or oddball blend they make one barrel of each vintage), or for small quantity luxury cuvees and SVDs, in either case that never make it to retail and sell through to direct customers and out of the tasting room
** some wineries have great customer service (e.g. credit you for corked bottles with no questions asked, happy to swap out wines that you don’t care for)
** customer doesn’t want to think through all the offerings and wines and is just happy to receive a mixed shipment from a winery they like X times per year
** customer perceives that he or she is “supporting” a particular winery or owner, maybe someone they are fond of personally or believe stands for something they want to support
** bragging rights (“I’ve been on the Screaming Eagle and Sine Qua Non mailing lists since the early 1990s . . .”) or showing off to friends when you take them to the winery and everyone treats you like you’re special
There are some other reasons people give that I suspect are rationalizations / covers rather than actual reasons; “provenance” is foremost among these. The idea that your case of Ridge wines directly from Ridge are any better in condition than the same case of Ridge new releases being sold at K&L or Hi Time is just silly, in my opinion. Okay, if it’s the difference between old library releases versus winebid, then just maybe, but how often does anyone really make that tradeoff?
But I think many customers, if they are in wine club of Winery X, and every time they walk into their local wine shop they see the same wines from Winery X languishing on the shelves at the same or lower prices then they are paying, will reconsider their wine club status, unless they consciously just do it for convenience or for winery extracurriculars.
There is no need to make that trade-off. Buy from a retailer that has a provenance guarantee so if you encounter a cooked bottle, you can send it back.
what kind of awesome place is this!? Wish there was a retailer who would take back the corked btls of burg I buy.
Cooked, not corked - provenance has nothing to do with the infection of TCA. Corked is a winery issue, which becomes tough to rectify if the retailer has no contact with the distributor (older wines). We always encourage customers to contact California wineries with corked bottles.
Not all wineries have national distribution. If it weren’t for mailing lists I would never get to see the Saxum’s, Turley’s, and Marcassins of the world due to regional availability.
Of course mailing list work for smaller wineries with little or no retail, that went without saying. Just surprised to see how companies like frank family, larkmead, morlet, realm, and the list goes on…can offer wine to the mailing list for more than what you can purchase it at retail. As for the argument that mailing list are fickle and chase numbers, first is make good wine and you will not have a problem and secondly if your prices are appealing then you will have a sizable waiting list.
Key is being able to collect 100% of the profit instead of having a distributor and retailer. Maybe others know but my guess has been that if there is a $50 bottle at retail the winery received @ $25 for that bottle. Sell it to your mailing list for $30-35 and your profit is greater and the mailing list is happy.
It’s hard to see the point of being on a list to pay a premium.
However, in most cases (non-cults, non-mailing list wineries), the wineries charge full list price so they don’t undercut the retailers because they are dependent on the normal distribution channels for most of their sales. They’d have a hard time getting distributors or retailers if customers could buy directly at cheaper prices.
Not sure where you live but realm, Frank Family etc are kind of smaller. They don’t necessarily have great local retail presence around.
Mailing lists customers historically HAVE been fickle and number chasing, ESP. when they got on the list because they saw a high score. IOts easy for you or I to say ‘just make a good wine and you’ll be fine’ because it’s not our businesses at risk.
Of course they want to collect as much f the revenue from a bottle as possible. But if you sell to your mailing list at that price they’re happy and distributors might well not carry you. So when the mailing list goes soft because of scores or, oh I dunno…a major recession… you’re screwed.
You may be right for wines sold at K&L, less than 25 miles from Ridge, but for those of us half way across the country, provenance is a real issue. I’ve seen how wines are handled by the 3-tier system here in Texas and it’s one reason I won’t buy wine from a retailer or restaurant in this state. The improper handling is appalling and the risk of getting a cooked wine is just too great. I realize FedEx or UPS aren’t ideal, but at least I have some knowledge and control over the conditions the wine is exposed to during shipment.
This is an interesting discussion that I was just talking about the other day with a friend.
I don’t think the tough Cults are applicable to this discussion. Screagle, Saxum etc… Sorry, but most retail stores aren’t carrying these anywhere close to release price.
But the original poster brings up Paul Hobbs.
I’m on the list and have ordered in the past and I must admit… it sucked when I paid $85 (plus shipping) for a single block Pinot, only to get it to my house and roll in to The Wine Exchange 2 days later to see the same exact bottle for $74. Yeah, it’s probably only $20, but I can be a cheap bastard times, especially when I don’t see any value filling the price gap.
Did I stop ordering? No… I like mags and I can’t get them anywhere else so now I try and focus on those.
…I tell you what burns my backside?, when I buy a bottle direct at a winery, only to see the exact same wine and vintage at CostCo 3 weeks later at 60% of the cost I just paid. That KILLS me. Duckhorn has done that to me a few times.
I have plenty of friends.