Good Grape Wine Company

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Wine Sediments at the Well Fed Network is undergoing some (cue David Bowie music) Ch ..Ch..Ch .. Chan ...Changes with some new overall leadership/ownership.Because of this, I’m going to do a full cross-post of my post for this week.  It’s not up on the site yet, but the full contents of my review of two in-home wine tasting/consulting companies should be up in the next day or so.  The Traveling Vineyard and Wine Shop at Home offer an interesting business model that is part Tupperware and part bourgeoisie schtick for the growing wine customer base.  I wouldn’t do this myself and most wine blog readers wouldn’t either based on their inherent wine knowledge, but this would be geared for your supermarket shopper anyways who is curious and intrepid.  Wine Palate Pleasers Pluck Your Wallet at Home Amway, Tupperware, Avon, Tastefully Simple, LongabergerBaskets, PartyLite candles, the Pampered Chef and dozens of others will need tostep aside. There’s a new party marketingsheriff in town and it’s in the name of home wine tasting. Many a sales person does their best selling half a bottlein at a business dinner and those socially lubricated sellers can take heart—there’snow a moonlighting opportunity available. Theera of the coffee klatch convening at a friends home for gossipy chatter, somenoshes and an order form is going decidedly upscale with the burgeoning growthof several home marketing wine concepts. The TravelingVineyard and Wine Shop at Home are two business models that have designs onconverting casual wine drinkers to loyal customers. ForWine Shop at Home, born out of a 1-800 mail order business—1-800-WineShop, thedirect selling arm was an expansion of their business that was already focusedon selling boutique wineries to customers direct. Inthe case of The Traveling Vineyard, its good business as a sales channel for Geerlings& Wade, a direct wine marketer with a catalog business. Bolsteredby a network of consultants a reported 1,500 strong, The Traveling Vineyard operatedin 25 states and reached 150,000 potential customers through 20,000 tastings in2005, according to a June Wine Business Monthly article.That’sa lot of wine. Theconcept is simple enough and intuitive to anybody familiar with the Amwaycome-on of, “Have you ever dreamed of being financially independent?” Eitherhosting a party or as a consultant, the name of the game is volume—volume insales and volume in having other consultants sign on to do parties and sellunderneath you. Ifyou are the host of the party, a Traveling Vineyard consultant will come toyour home with five bottles of vino and the all of the accouterments needed fora tasting—including the invites to get them there and the glasses andevaluation forms thereafter. WineShop at Home is similar if not more lifestyle-centric offering the opportunityfor custom labels and wine gift baskets to add to their eponymous wine club. TheTraveling Vineyard also offers a wine club called Passport. TheTraveling Vineyard is an interesting concept with virtually all of the winepresented and sold made or bottled exclusively for Geerlings & Wade,according to their Marketing Director Denise Kotopoulos as quoted in WineBusiness Monthly. WineShop at Home sells smaller production wines with the occasional large volumeproducer like Coppola. Though, thoseplans are changing as this article indicates that they too hope to haveall of their own brands by the end of the year, as well. Asa consultant, you facilitate the tasting at no charge, but make a commissionoff of the wine sales that take place. In the case of the Traveling Vineyard, if there are no sales, then thebottles of wine sampled are charged to the facilitator. The more wine sold, the more afacilitator/consultant can make. And,in an era of convenience, both business models are only operating in stateswhere direct sales are permitted, with growth planned as the other statestopple their wine shipping laws. Anecdotally,the Wine Business Monthly article indicates that commissions for The TravelingVineyard can be 20% of their direct wine sales and a smaller percentage ofdownline sales for those that they recruit that consult at parties underneaththem. Thesetwo business models are interesting in that they demonstrate an obviouseducational opportunity for wine to a wide customer base that will benefit thewine market overall. But,it also begs a couple of questions. Twothings immediately come to mind that should be addressed for any wine loverthat is serious about their vinous activity. First, the quality control for education with the consultants seems tobe an area where passion can trump expertise—which is all well and good until Iwant to know the difference between a Syrah, Shiraz and Petite Sirah. Secondly,20% commissions are healthy when you consider that most retailers take, at most,a 35% mark-up from distribution. This questionis answered pretty easily when you consider that both companies are movingtowards or are already committed to private labeling. Simply put, the margins are better, but are the wines better? Regardlessof preconceived notions of in-home parties the sort that require a checkbook,both of these businesses are growing rapidly in sales and number ofconsultants. CaveatEmptor in all things, but at least you get to try the wine first. http://goodgrape.com/index.php/185/