There’s a Corner on the Internet For Every Wine Drinker
Unlike the latest gadget, wine is not launched in intervals, with updates from 5 to 5S, or PS3 to PS4. It’s not the latest iteration, but rather, the old wine that is better. Instead of coming from heavily marketed brands, good wine often comes from tiny wineries in California with little to no mainstream name recognition. By definition, mass producing wine lowers its quality.
Enjoying wine is also an expensive sport. To add insult to tragedy, the ability to enjoy the more expensive wine is an acquired taste. Madeline Puckette, a certified sommelier who runs wine education site Wine Folly explains that as a wine drinker develops his or her palate, preferences will veer towards the more complex Old World wines.
Wine, with its enthusiastic and perhaps elitist consumer base, has lived quite comfortably in its small niche on the Internet. But one company, Lot18, sees the opportunity in appealing to mainstream wine drinkers who perhaps work around a tighter budget.
“There’s plenty of people who want to get into wine,” says Mike Whipple, who leads wine tours and dining experiences in San Francisco. He explains that it used to be something only people who were sophisticated drank, but is becoming more accessible. With the Internet’s ability to give exposure to “long tail” products, the small, family-owned wineries should be able to be found by wine drinkers near and far away. But so far, the wine industry has not been friendly with the open web.
Wine Versus the Free Market
The Internet connects buyers and sellers directly. But due to legal regulations — mostly around shipping or delivering wine in certain states — wine is most often accessed through intermediaries and stores that never seem to have what you’re looking for.
Some wine startups have had success with adding a layer of curation to the wines they offer.
Gilt Taste, a vertical of Gilt Groupe, hones in on the premium lifestyle and sells products that appeal to that type of consumer in verticals — so wine is one of its many products. Its price point ranges from prosecco for $14 to Petrus for $2,800, and typical wine customers are females under 40, says Jeffrey Meisel, wine and spirits consultant to Gilt.
“First sip I was astounded at how bright and lively this wine was. The acid was brilliant with the flavours coming from the pomegranate and strawberry axis. … The finish was *long* and primarily mushroom with a hint of smoke.”
However cost-conscious, the site still appeals to more experienced wine drinkers.
Lot18, a flash-sale site for premium wines, also achieved some success by offering a curated selection of wines at a discount, but found that selling only premium wines did not allow for the growth it’s aspiring towards. It first added food and travel verticals, then shut them down; its expansion into the UK was also reversed.
The problem, explains CEO Jay Sung, is that the company hit a ceiling: The average bottle price was $30, users were 2/3 male and the typical customer was an investment banker. That’s a limited market — fine as a vibrant business, but not satisfactory for a funded startup that requires growth.
The average price of a bottle of wine in the U.S. is $6.22. There’s a lot of bottles sold that would never make it onto these premium wine sites.
Sung says, “We would go and offer $300 cabernets and they would sell out instantly. But the thing is, normal people don’t drink $300 cabernets.”
However, merely introducing wines at a lower price point would not fully address the issue.
The other problem with these “normal” wine drinkers is that they don’t know what they’re looking for. Anyone who’s been baffled by the tasting notes in wine shops will agree. Puckette explains that the more people drink wine, the better they’re able to put into words what they like and don’t like — therefore, they’re able to pick it out of a list on a web page. So even a site like Wine.Woot, with the thoughtful descriptions posted by fellow wine drinkers, won’t really help the amateur wine buyer decide what to purchase.
How Wine is Discovered
Buying wine is a risk — and more pronounced when it’s expensive wine. This is why most bottles sold were first discovered by drinking a glass at a restaurant or visiting the winery.
Wine tasting is easily the most popular form of culinary tourism, and aside from technology, is the “other” thing that the Bay Area is known for. In a typical wine tasting you’ll be served wines from lightest to heaviest, a mix of whites and reds, and if you find something you like, you can purchase a bottle, or more likely, a case. Most wineries offer wine clubs with tiered pricing, and each month or quarter they’ll deliver you a selection of the wines they have available.
This is different from a Wine of the Month club, the first of which was started in 1972. Both The New York Times and the Wall Street Journal offer wine clubs (low-tier average bottle price is $15 and $12.50, respectively) through partnerships with wine providers.
You might also discover wine at a restaurant, at the recommendation of your server or, at a nicer place, via the sommelier, who will ask you questions about your personal tastes and what wines you’ve liked in the past. At a good wine shop, a sales associate might help you pick out a bottle. Otherwise, Puckette says, most people will choose based on price or varietal (which is unhelpful if you’ve only heard of six varietals).
The 100-point system used to rate wines can provide a metric for quality, but what wine intrinsically lacks is a feature set, says Sung. You can’t compare wines on a grid like you can iPads and Kindles.
Finding Your Personal Taste
Web-based businesses constantly disrupt one another. When we want to find something, we turn to Amazon or Google, initially for books and information, respectively. But the next tier has to do with discovery. For example, Goodreads is the foil to Amazon, while Pinterest is the foil for Google — each wants to give you what you’re looking for, before you know what it is.
This would be an especially difficult problem to solve with wine. As mentioned, it has no features, no data points — nothing to construct an algorithm.
Then again, neither does the human mind. But psychologists effectively use the Myers-Briggs test to help people talk about decision making and thought process in order to make recommendations on things like careers or conflict management strategies.
When Lot18 discovered another wine startup called Tasting Room, which sends its customers packs of sample-sized bottles of wine created with a special machine, Sung realized there was an opportunity to merge technology and the wine knowledge of the Lot18 staff.
The Smart Wine Subscription
The founder of Lot18, Philip James, has come up with every imaginable type of business model specific to wine, Sung says. (James is also the founder of Snooth, an earlier wine ecommerce site). But one model that’s gained popularity elsewhere on the web, from Dollar Shave Club to Birchbox to its copycats in other verticals, is subscriptions.
Interestingly, it’s a model that worked well with wine long before the Internet. But Lot18 wondered if it could map out the tasting data points of wine to create a wine club that harnessed the algorithmic powers of our other favorite web products.
A lot of consumers don’t know what their tastes are, and they also don’t know what bottles of wine out there taste like,” says Sung, “So we said, why don’t we create a really innovative experience where we use these assets from the Tasting Room and build kind of wine club 2.0, which is the first wine club that’s built on your actual taste preferences.”
Once Lot18 purchased the trademarks and machine from Tasting Room (its previous business is winding down), it acquired the ability to bring a wine tasting to your living room. This wine tasting — six 50 mL bottles, two whites and four reds — precedes a “smart” wine club in which the wines you receive are personalized to your tastes (a case of wine, 12 bottles, is delivered quarterly). The name of the service is Tasting Room by Lot18 and it is currently in beta (the existing flash sale site at Lot18.com will remain).
Is 50 mL enough to taste a wine? At wine tastings and restaurants, the serving size is typically one to two ounces, and 50 mL is just under two ounces.
After the initial tasting (at $10 for the tasting kit), you’ll complete a tasting and rating experience on the wines. Then you’ll receive a card that tells you what kind of wine drinker you are, called a WinePrint (complete with a “pithy, one sentence phrase you can use to describe your wine tastes,” Sung says, when you’re at a wine store or restaurant). This is the Myers-Briggs side of the concept.
But with each case of wine you receive, you can continue to rate wines so your recommendations get smarter as you go.
It’s the Pandora of wine, Sung says. “The one thing missing from the personalization experience on the web for wine is the ability to actually taste the wine. And that’s the thing that’s specific to the wine industry, of our product, that we really can’t achieve digitally.”
But whether it can avoid Pandora-style weaknesses is yet to be seen.
Algorithm, Do No Evil
Have you ever had friends over for a party, only to realize that even your best Pandora stations weren’t suited for the crowd?
It’s the same with wine. There’s even a term for the type of wine you’re supposed to bring to a party: “crowd-pleaser wine,” Puckette says. For whatever reason, reds are more often available at parties (my theory: because they don’t require refrigeration). A wine that has less tannins and more fruit is likely to be appealing to a wider range of wine drinkers.
It seems Tasting Room’s algorithm could cause wines to become too suited to your personal tastes to share (not a huge problem), or worse, one bad move on a rating card could cause recommendations to turn sour. As a relatively inexperienced (but enthusiastic!) wine drinker, I know I’ve had tasting moments of, “Did I like that, or maybe I hated it? Tin foil and … raspberry?”
Another startup, Winestyr, addresses the issue by choosing wine by occasion. The site sources hard-to-find craft wine directly from wineries and recently launched a web app that will recommend three wines based on who it’s for, varietal, occasion and price point.
It feels a bit like Facebook Graph Search. The most thrifty price range available is “under $20,” so the wines on the site, to many people, will be considered premium.
Whipple notes that it is possible to find great wines in a lower price range. The key is to find wines from less “trendy” regions, such as Lodi rather than Sonoma, where a family winery (Bogle Winery is one he recommends) might be able to pay less for the land and pass on those savings to you, the buyer.
Blush, a mobile app, does something similar to Winestyr, but pulls in your personal tastes, such as how you like your coffee, and instead directs you to local stores that carry the wines it recommends.
The laws are still not friendly to these wine ecommerce innovators, but each is working to make buying wine better and easier (for example, Tasting Room by Lot18 is not available in New York at launch, but will be soon). Buying wine online is not yet a perfect experience, but it’s definitely heading in the right direction.
Do you belong to a wine club or purchase wine online? How do you discover wines that you like? Tell us in the comments.
Image courtesy of Flickr, smallkaa, Lot18, Winestyr