Wine and all its Webs

People in the technology and Internet business often talk about what the next thing is after the Internet. The wine industry has been greatly impacted by the Internet and will be as greatly impacted by the next step in digital marketing and communication. Wine business has been represented on the Internet since the beginning of the dot com craze in the late 90s. One of the big flops was It is still in business, but in their third or fourth incarnation or business model change.

Back at the height of the dot com craze, the url was sold for 2.9 million dollars. That’s just for the site name, making it the fourth highest amount paid for a url. The name was purchased in 1999 by Virtual Vineyards, a wine web retail site owned by a software developer and his brother-in-law, Master Sommelier, Peter Granoff. The concept for Virtual Vineyards was to broaden the sales of small producers (production of about 5,000 cases in total) that were being pushed out of distributors and big-box retailers in the early 90s. I remember that time of the wine industry—when Kendall-Jackson and Gallo were fighting for shelf space in every wine store. So what has changed since then? Plenty and yet not a lot.

Wine brands are still kings in retail stores. Kendall-Jackson and Gallo have bought many properties throughout the wine world and market them fiercely. And sells big brands, lots of them. The number one wine on the site is Cambria Pinot Noir, Julia’s Vineyard. Number 56 is Kendall-Jackson Vintner’s Reserve Chardonnay. Cambria produces about 55,000 cases of the Julia’s Pinot Noir and Kendall-Jackson produces about 2,000,000 cases of the Vintner’s Reserve Chardonnay (both wineries are owned by Jess Jackson). To me, a small production winery is less than 10,000 in total production and even that is huge compared to Long Island.

But ever since the beginning of Virtual Vineyards, wineries and marketing gurus have been trying to figure out how to use new technologies to promote and sell small production wines. It seems to always come back to power—power of the distributors, importers, big wineries, big wine corporations and wine critics. The Internet was supposed to give the small guy power, but in the wine industry, it hasn’t. I’d love to see the way we look at wine flipped on its head, where the consumer is king, not the producer or wine critic. Since the Internet hasn’t been able to crack this cycle, maybe the next wave can with things like mobile apps, social communities and the like. Current examples include websites like Winesearcher, Snooth, CellarTracker and apps like Drynks, Cellar, iWine, Twitter and probably thousands of others. But there still hasn’t been a “killer wine app.” That one application that everyone uses as the standard, the way Robert Parker and The Wine Spectator became the standards for wine reviews or the way Zagat has become the standard for restaurant reviews. Right now, it looks like “big industry” will continue to control the wine industry, with big distributors having the most control and the consumer and small winery lagging far behind. If any readers come across any type of platform, website, facebook, twitter or phone app that they think could be the next killer wine app, please let me know.