Wine Industry Metrics
Wine Woot Driven by Fans and Critics
by Jim Gordon
Sonoma, Calif.—The online retailer and Amazon subsidiary Wine Woot doesn’t lead the flash sales market in terms of offers; what sets it apart from other retailers is its distinct and loyal community of fans.
“Every day there’s winery participation with prospective buyers,” said David Studdert, president and co-founder of Wine Country Connect (WCC), which handles operations and winery relations for Wine Woot.
Woot offers one deal a day with special “Woot Off” offers of shorter duration and “Woot Plus” deals featuring wines from a single winery that may last for a few days. The site averaged about 22 offers per month until June, when that number catapulted to 88 offers. The site has averaged 85 offers per month through August, according to WinesVinesDATA.
Launched in 2006, Wine Woot came online in time to take advantage of the recession-fueled flash market, but Studdert takes umbrage at being compared to other flash sites. “I get a little chip on my shoulder when I’m brought into the fold with everybody else,” Studdert said. “Even though we started the space, I’ve never liked calling Wine Woot ‘flash.’”
Staying viable in a changing business
“Now six years later the economy is improving, excess supply has been largely corrected, and the space has matured and become crowded,” he said. “My guess is that the crowd will be thinning soon, and those without substance, strong regulatory footing or a positive impact for the winery will be the most susceptible.”
Wine Woot sources from more than 300 wineries, and its wine channel has enjoyed steady growth since the launch. Studdert declined to disclose specific sales numbers.
Woot provides advertising and the public face for the operation. Winery clients work with WCC to facilitate the shipping and sale of their products at prices agreed upon by the winery. The shipping must comply with a winery’s own permits (Wine Woot does not hold permits with any specific states itself), so consumers in some states may not be able to buy certain wines through the website. The arrangement ensures that every shipment by Woot and WCC is fully compliant and legal, Studdert noted.
Woot is an independent subsidiary of Amazon. The online giant approached vintners in Napa and other wine regions this fall about plans to return to the world of web-based wine retail, but so far the company has not made a public announcement. Studdert declined to comment about reports of Amazon’s latest flirtation with the wine sector.
Studdert’s introduction to the wine industry was Airborne Express, where he helped wineries ship wine. But after the 2005 U.S. Supreme Court’s Granholm v. Heald decision loosened shipping laws, he started looking for something new. Studdert discovered Woot through a newspaper profile; a year later, Woot and Wine Country Connect were in business. WCC provides the same services for Rue La La, an “invitation-only destination for a life of style” website with limited wine offerings.
WCC operates a warehouse in Sonoma’s industrial area off Eighth Street East with three full-time employees and a few part-time staffers. Studdert’s brother George Studdert is co-founder and managing director.
From Sept. 1, 2011, to Aug. 31, 2012, WinesVinesDATA recorded 444 unique offers by Wine Woot. The average winery retail price of the wines offered was $34, and the average flash price was $23, for an average discount of 31%. Woot recorded the fewest number of offers for wines with a retail price above $50.
Vocal fans and critics online
Studdert said the robust comments in the Woot forums make it a very different animal in the flash arena. “There’s an intimacy with buyers not seen in the industry,” he said, adding that Wooters can be a tough audience. Woot staffers occasionally promote a comment to the status of a “quality post,” and details about how many purchases forum commenters have made are available to fellow Wooters.
When someone with no quality posts nor history of being a regular in the Woot world comes along praising a specific wine, Wooters can be quick to turn on a suspected winery shill. “Nothing irritates Woot more than fakeness. Wooters can smell it a mile away,” Studdert said
More positive interactions occurred in late September, when a group of Wooters from Northern California used the message boards to plan a day of wine tasting in Sonoma County. Their posts included ideas on where to stop, what to have for a potluck lunch and where to eat dinner.
“There’s a physical manifestation of an online community,” Studdert said. “It’s very gratifying to see that occur.”
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