Rethinking Online Sales For Premium Wineries: NakedWines.com In The COVID Era

Food & Drink

“In this game of pivoting, it’s a pivot for us.”

That’s Ana Keller of Keller Estate Winery in Sonoma’s Petaluma Gap, describing her experience this past year with NakedWines.com, a crowd-funded online retailer that in normal circumstances wouldn’t have been a sales channel that she or her family’s winery would have explored.

But that was pre-COVID, before “normal” circumstances became anything but.

It’s a long-held tenet in the wine industry that brands are built on restaurant wine lists. However, with the on-premise channel essentially non-existent for much of 2020, and now into 2021, Keller and many other wineries have had to consider other options to sell what has become excess inventory. Though these wineries had in fact followed the traditional rules, built their brands in restaurants, and relied on their success with sommeliers and on-premise buyers for significant portions of their sales, that system and that in-person marketplace has seen unprecedented disruption during COVID.

So what’s a winemaker to do?

Part of the answer lies in alternatives offered by quick-on-their-feet retail businesses, including NakedWines.com. In April last year, the company announced a $5 million support fund for winemakers impacted by COVID-19. “The fund,” the announcement read, “is immediately available and will be deployed to purchase stock that was previously destined for channels such as restaurants, tasting rooms and traditional retail stores, is available to independent winemakers all over the world.”

Testing the Waters

It’s an appealing opportunity, but jumping into business with NakedWines.com wasn’t a decision that Keller took lightly. She bought a few cases of other wines that the company sells and admits candidly that there were some she did not enjoy. “It is a beginner’s palate,” she said, “and some were a little sweeter.” Some people she spoke to were “horrified” that she’d consider selling wine through the Naked Wines channel.

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Nonetheless, Keller already knew of several great wineries who have been selling through NakesWines.com. She continued to learn more, and kept weighing the pros and cons.

Potential Downside: Diluting the Brand

Why would Keller Estate’s regular customers continue to pay $60 for a bottle of their El Coro Pinot Noir from the Petaluma Gap when a different Keller Estate Pinot Noir from the Petaluma Gap, this one named Casa, sells for $28? Or $18 to Naked Wines “angels,” as the company calls their subscribers?

The danger of diluting the brand is an immediate and obvious concern, but Keller offers an interesting counterpoint. “We can keep doing small lots of the best of our best wines, because selling more Casa wine is helping us offload some of the costs. Casa wine helps me make even better Keller Estate. For Keller Estate to keep going, we needed to grow,” Keller said.

Upside: Consumer Feedback

“We lost a lot of customer acquisition techniques and strategies” during COVID, Keller said. Working with Naked Wines has been a great way to spread the word. She referenced their SEO analytics that showed people going to Naked Wines’ website then coming to Keller Estate’s. That has been a very big upside to the experience. Another is near-immediate feedback from everyday consumers.

Keller also learned that there are new consumers everywhere.

“Feedback from consumers is not something you rarely get from the premium market,” she said. “We learned a lot about all the different kinds of consumers,” such as how they drink their wine (pool side, etc) and how they describe their wine (more about the atmosphere than the wine itself).

There’s still, and always will be, a place for the $60 bottles of wine — Friday night meals, for example, or anniversaries or holidays. But not necessarily for your Tuesday night tacos. That’s a more casual space to experiment if your budget allows. That back and forth is also, for Keller, “the fun part of wine.”

Final note: I conducted a mini-experiment to test the $60 versus $18 comparison, and poured samples of each Keller wine for friends within our COVID pod. We blind-tasted the 2019 El Coro and the 2019 Casa and yes, we could each tell that the El Coro was the finer, more “occasion” wine. Knowing that we could purchase the Casa as a regular weeknight wine, however, was a special bonus.

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