The internet's portion of winery revenue jumped to 16.2 percent in 2020, up from 8.6 percent in 2018. Photo: Karolina Grabowska/Pixabay
The internet's portion of winery revenue jumped to 16.2 percent in 2020, up from 8.6 percent in 2018. Photo: Karolina Grabowska/Pixabay

Buying wine online is a pandemic-era shift that's poised to stick around

By The Washington Post Time of article published May 15, 2021

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INTERNATIONAL - Pandemic restrictions are beginning to ease, and we may soon feel more comfortable returning to our favourite restaurants, wine bars, wineries and stores.

But what about all those "pivots" we made last year - will any of those become permanent aspects of our everyday lives?

One new habit likely to stay with us: buying wine online. Some venture capital investors sure think so.

"Covid was a great awakening," both for consumers and wineries, says Paul Mabray, a longtime e-commerce advocate for wineries. "How often before the pandemic did you order groceries or restaurant meals to be delivered to your door? Or wine?"

The pandemic had us turning to our phones or computers to buy wine from wineries, from local retailers for curbside pickup, or for home delivery through apps, such as Drizly.

The internet's portion of winery revenue jumped to 16.2 percent in 2020, up from 8.6 percent in 2018, says Rob McMillan, executive vice president of the Silicon Valley Bank and a leading analyst of market trends in wine. McMillan will release his annual report on direct-to-consumer, or DtC, sales on May 25. Tasting room sales, traditionally the biggest portion of the DtC channel, declined because of decreased tourism. We were staying home, after all.

"Digital sales have ramped up, and there is every reason to believe they will continue at a high pace," McMillan wrote in an email.

Mabray is hoping to tap into that increase in e-commerce as CEO of Pix.wine, a new digital wine sales and media content website set to launch in June. He describes it as a "discovery platform" that will act as "the Google of wine," connecting consumers to wineries.

Mabray dismisses as "hooey" the algorithms sites use to suggest wines based on how bitter you like your coffee. Pix will "watch what you click on and what you search for, to learn who you are and what wines you like," Mabray says. Sort of like those banner ads that seem to know your every thought.

Pix, based in Napa, Calif., with 18 employees, is funded by wineries and retailers, as well as some professional investors, Mabray told me. It will be going up against established wine commerce sites such as Wine.com, Wine-Searcher.com, Winestyr and Naked Wines, all of which recorded strong sales growth last year. Sippd, a new app with apparently more modest ambitions, aims to point users to wines they will like on a restaurant list and help them buy it at retail.

And then there's Vivino, the app that began as a way for wine lovers to record and share their own tasting notes (and show off their collections), and evolved into an online marketplace to connect retailers and wineries with consumers.

Vivino boasts more than 200 employees and 50 million "community members" - up from 29 million in 2018 - spread over 18 countries, according to Theis Sondergaard, Vivino's co-founder and chief product officer.

Earlier this year, Vivino secured a whopping $155 million in Swedish venture capital, bringing its total to $221 million since its founding in 2010. The company aims to use that funding to enhance and expand its wine recommendation software and sales platform.

Vivino users "taste and rate a lot of wines, even the lowest shelf in the grocery store," Sondergaard told me in a Zoom interview. "The voice of this community is pretty spot on when compared to how the experts rate wines."

Ratings are one to five stars, and users may enter their own tasting notes. The software mines these ratings and descriptions for keywords such as peach, oak, fruity, earthy and mineral. The more ratings and descriptions you enter into the app, the more it learns about you and your preferences.

"Don't call it artificial intelligence," Sondergaard implored me. "It's machine learning." He was also OK with "data mining."

For the consumer, Vivino's best feature is its ability to scan a label or restaurant wine list using your phone's camera. It's lightning-fast and accurate in recognizing all but the newest or most obscure wines and makes rating wines a cinch. When you scan a label for the first time, the app gives you a percentage score of whether it thinks you will like the wine, based on your own ratings and the consensus of the "community." This new Match For You feature has tried to steer me away from a few wines I really liked, but perhaps I haven't been using it long enough for the app to get to know me.

Online orders also helped many retailers stay in business during the past year, when in-store shopping was limited or banned. Michael Sands, president of Calvert Woodley, a major retailer in D.C., says many customers enjoyed the experience.

"You can put an order online at 10 at night, then pull up to the store the next morning and you don't even have to get out of the car," Sands explained. Online sales and curbside pickup helped compensate for lack of foot traffic last summer. And now, even though some customers come into the store to pick up their orders, "curbside pickup is here to stay," Sands says.

The Washington Post

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