May 19 2007
The news of the week in the online wine world has to be the Winelibrary acquisition/partnership with Cork’d, a wine tasting note site launched last year. It might be an acquisition. It might be a partnership. Who knows? What is known is that Gary Vaynerchuk from Winelibrary isn’t afraid to take a risk.
Fact is he could continue to sell in a Wine 1.0 manner while letting his star burnish an image from a marketing perspective in the Wine 2.0 world. So, it takes a lot balls to try and marry the two in a manner that hasn’t been done. Lost in the noise of the ongoing evolution in the Wine 2.0 world is the fact that “free” isn’t a business model, so, perhaps, taking the community aspect of a tasting note site and merging it with buying opportunities via a large online retail wine presence is a way to leapfrog the old guard (Wine.com) and the new guard sites (appellationamerica.com) into truly a next generation site that provides value.
Interesting to me that a wine direct marketer like Geerling & Wade hasn’t tapped into the online community to a greater degree in order to mobilize a community of online wine drinkers into customers—they ship to all 50 states and could have been doing something like this and operating on the cutting edge for months, if not for well over a year.
For now, perhaps it takes a young visionary guy like Gary from Winelibrary to see opportunities, and more likely, to see risk as the cost of doing business and but a small factor in building success.
For a round-up on the blog posts I’m aware of discussing the acquisition, see the below links:
Hivelogic/Cork’d Co-Founder Dan Benjamin
Simplebits.com/Cork’d Co-Founder Dan Cederholm
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This is a huge opportunity - and the marriage of review potential with buying power is massive. If one looks at how Amazon utilizes user reviews and personal lists to boost sales - the opportunity certainly exists in wine. This week I’m going to take on the London wine-fair, which is basically 1,500 wineries strutting their stuff in a space the size of two football fields. The cost of participation is significant, and what’s even bigger is the sheer anonymity of it all. Having represented a few brands myself, I’ve seen the frustration that comes when you see that you don’t get any return on attending a wine fair. Namely because you can’t sell the wine there and then - and by the time the guy you got excited about your brand has left the room, he’s already gone through the innebriating sip-spit-sell-sell routine 50 times, and is not likely to remember much the next day.
I think that a lot of wines are like indie bands. They’ve got a small following of regular attendees - and they haven’t quite gotten close to getting a big record deal. Ultimately the differentiation then between sell out wines and ones that don’t get to the shelves, becomes arbitrary.
The whole situation is reminiscent of the music industry before MySpace, which has just acquired the rights to sell music from the site. I wonder if we’ll start seeing online concerts from people’s garages where you can buy tickets to watch online.
Now that Gary’s got Cork’d - the opportunity exists to mary consumer participation with consumption. Ultimately your observation that Gary’s taken the Wine 1.0 model and made it a lot bigger is too true. Gary’s a super-salesman who hand sells wine - and before WineTV he won hearts and minds one customer and one wine at a time. Now he’s able to do multiple wines and win over hundreds of customers each episode, five times a week, 52 weeks a year. Unfortunately - the system ends up perpetuating itself - and its a case of either being on WineLibrary TV/ or more often, not being on WineLibraryTV. Gary may not yet be Wine 2.0 - but he runs the risk of becoming Parker 2.0… and I think that acquiring Cork’d will make WineLibrary less autocratic and Garycentric… and will instill a more democratic vibe. The community aspect is missing.
We live, or rather - drink in interesting times…