Good Grape Wine Company

December 17 2006

The “Netflix Effect” and the World of Wine

I should know by now that there are no new ideas. 

I was stuck in an airport this past week suffering through a seven hour delay, ingesting Shipley’s donuts, McDonald’s, Skittles, Powerade and other comestibles best left to guys 15 years my junior. 

Somewhere in between my sugary nutrition-less disposable food consumption and phone calls to be productive during a work day was the current Entertainment Weekly that had, curiously, a full page ad for Sunset Magazine’s Wine Club.

This was on the heels of reading the current issue of Wines and Vines magazine that gave a rundown of current wine clubs—California Wine Club, Avawines.com, Celebrations, Sunset, and several others.

Prior to this I had driven past a Blockbuster store in Houston that was shutting down with gigantic banners indicating to pay a visit to blockbuster.com.

Ah, the “Netflix Effect.”

Primed and attuned with my radar focused on wine clubs, I took a note down for a potential future blog post, “The Netflix of Wine.” I figured it might be a stretch, but what the heck--I’ve written about crazier things before.  Sometimes I write some wacky ideas just to see if anybody is paying attention.  Maybe this would be another opportunity. 

Then I got home and started reviewing the Menu for Hope III wine prize lineup to see if anybody had bid on my Cal-Mid prize offering.

{Brief Aside:  Please bid on my prize offering here.  The current bid is $10.  This is a brand spanking new book purchased expressly for this fundraiser ($30 value); a bottle of Oliver Winery Cabernet purchased expressly for this fundraiser ($20 value) and a bottle of the ’99 Heitz Cellars Martha’s Vineyard designate (at least a $130 value).  I’m inclined to bid on my own prize offering so I don’t have to send that Heitz off for $10 bucks. Please help support a good cause and bid for WB13}

While checking out the Menu for Hope III program I ran across a prize offering from a new wine start-up called Wineq.com.  They are new as in squeaking new as of this past week—Launch was December 11th.

Wineq is a start-up that has modeled itself after Netflix (a transferable business model) for the world of wine.  And, they don’t make any bones about replicating the model.  My genius idea, yeah, um, it launched on the Monday before my Thursday note to self.  Better late than never, I suppose. 

Their premise is simple:  turn the modern wine club upside down.

And, for the most part, I like it. 

In a perfect world, a wine club acts as a personal sommelier that delivers quality wines that you’ll like to drink straight to your door.  In the new millennium I’m not so sure that a new paradigm isn’t called for and the Web seems like the most reasonable means to deliver service and selection. 

Wineq does this.  They are focused on the small, boutique, artisan wines, but their model uses their site to customize preferences for shipment—the frequency, the actual wines (just like NetFlix), quantity, etc. 

So, if you want to receive 2 wines once a month for 6 months, you would queue up 12 bottles, pay your monthly fee and wait for the wines to come on your determined timetable.

I did say monthly fee because like NetFlix, they also charge a monthly service fee.  According their web site, the fees mostly support free ground shipping on orders over $35.  2nd day air is a reasonable $5.  Orders under $35 are charged a $5 shipping supplement. 

I’ll have to see this in action, but if they are able to get customers to buy into the monthly fee and forget about the shipping then that will be a masterstroke.  Research I’ve seen indicates that wine shipping costs are a tremendous online consumer wine shopping inhibitor and this serves to remedy that circumstance. 

Overall, as you would expect from a launch, the number of wineries are few, but they indicate they will be signing up at least two a month.  If they create any kind of Internet ripple, though, I suspect that will not nearly be enough to satisfy consumer lust for diversity. 

Good luck to these guys, for sure.  Anything that helps support the small winery is something I fully endorse.  But, just as Tom at Fermentation recently noted that the number of wine blogs doubled in 2006, so too have the wine related Web based businesses.  There’s likely fallout somewhere in the next 18 months as some of these businesses contract.  I just hope that some of these small wineries are cultivating multiple channels of business and spreading the love around to a lot of different places.  There are no new ideas, but winery sales channel diversification is a novel idea that most should be following. 

Check out Tim’s post at Winecast.net, as well. 

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