Amazon Joining the Wine Biz
It looks like Amazon.com is entering the wine business. The world’s largest online retailer is reportedly on the hunt for a senior wine buyer that will oversee “the acquisition of a massive new product selection," according to an article in the Financial Times. The question is: how will it work? As we know, shipping wine directly to consumers has been a big issue for wineries, wholesalers and retailers in recent years, and is a much bigger fish to fry then, say, shipping books. Wine.com, the largest US online wine seller, has managed to comply with state laws that ban out-of-state retailers from shipping directly to consumers by opening warehouses in those states (10 to be exact) that buy wine from wholesalers. Otherwise, Wine.com ships wine to customers in only 26 states.
Amazon has a short history with the internet wine shipping game. The company invested $30m in 1999 in a 45% share of Wineshopper.com, a start-up that expired the following year, according to the FT. Wine.com currently sells food gift baskets on Amazon's site, but not wine.
While Amazon declined to comment on its plans for internet wine orders, the company said it will add wine and beer to a pilot fresh grocery delivery service, Amazon Fresh, that it is currently operating only in its home city of Seattle.
The point is that shipping wine ain’t easy. The article comments that “some smaller e-commerce sites have been shipping wine to customers in defiance of state laws, taking advantage of the difficulty state regulators face in identifying unmarked small shipments to individuals.”
Amazon getting involved in wine shipping could spell bad news for the wholesaler cause. Amazon could join the legions of Costco, wineries and other retailers that are working to overthrow state laws that restrict or ban them from bypassing wholesalers. It will be an interesting case to watch. If Amazon does in fact add wine to its long list of merchandise, wholesalers, retailers and wineries could have a lot more court cases on their hands.
SPIRITS GAIN TRACTION IN JANUARY
Who says spirits growth is slowing? The spirits biz had a great month in January, according to IRI, with especially strong dollar sales growth and promising volume growth. In the four weeks to January 27, 2008, dollar sales grew an impressive 7.8% and volume grew an equally impressive, although slightly slower, growth of 4.9%. As a point of reference, dollar sales were up only 2.3% in December and volume grew at a much lower rate of 0.8%.
Several spirits companies have reported that sales were slower in November and December, and we’re certainly seeing those trends in the numbers. All spirits categories performed better in January. IRI also shows evidence that while the value segment might be in decline, super-premium and ultra-premium brands continue to grow. For the year ending Jan. 27, spirits dollar sales were up 3% and volume was flat.
VODKA. Vodka dollar sales increased 9.6% in January and volume was up 7%, which is an even stronger performance then in December (up 5.8% and 5%, respectively). All of vodka’s price categories are growing, particularly in the super-premium and mid-value groups. Dollar sales of ultra-premium vodka grew 12%, super-premium increased 47%, premium was up 7.8%, mid-value grew 13.7% and finally value grew 7.3%. Volumes for super-premium and ultra-premium vodkas grew at a faster rate, up 65.5% and 13.6%, respectively.
WHISKEY. Dollar sales of whiskey grew 6.5% in January, while volume rose 2.1%. The highest rate of growth continues to come from the Irish whisky category, with dollar sales up 39% and volume up 42.5%. Dollar sales of Scotch grew 4.1% and volume declined -1.6%. North American whiskey rose 6.5% in value and 2.6% in volume.
Ultra-premium whiskey showed the most growth in January (12.3% in value and 5.2% in volume), followed by super-premium whiskey (9% and 6.6%). Premium whiskey is holding steady, while the rate of growth has stalled for both popular and economy whiskey.
RUM. Dollar sales of rum increased 9.8%, while volume was up 7.8%. Ultra-premium rum continues to show rapid growth, with value increasing by 91.3% and volume up 94.2%. All rum price segments showed growth, aside from economy rum. Dollar sales of super-premium rums rose 5.8%, while premium rums were up 10.7% and value rums increased 7.6%.
TEQUILA. Tequila showed the most growth out of all the alcohol categories, with overall dollar sales rising 13.8% and volume up 10%. Sales of the ultra-premium tequila segment rose 33% in January, followed by the super-premium segment with growth of 19.2%. Volumes were up 33.6% and 22%, respectively. Value tequilas ($9.99 and below) saw volume rise an impressive 30%, while dollar sales were up 13.4%. Premium tequila’s dollar sales, meanwhile, rose 4.5% and volume was up 3.5%.
GIN. Ultra-premium gin declined by -10.7% in both dollar sales and volume. Premium gin grew 6.5% in value and 4.8% in volume, while value gin sales grew 0.1% and volume declined -2.6%. Overall, gin grew 2.6% in value and declined -0.9% in volume in January.
WSD BRIEFS:
A WISCONSIN BILL BARRING WINERIES FROM SHIPPING TO RETAILERS, including restaurants, bars and grocery stores, passed the legislature last week and now awaits the Governor’s signature.
COSTCO SAME STORE SALES rose 5% in February for the U.S. and 3% excluding recent gas price increases. Net sales for the second quarter increased 12%.
Until tomorrow, Megan
“The power of accurate observation is commonly called cynicism by those who have not got it.”
-George Bernard Shaw
--------- Sell Day Calendar ----------
Today's Sell Day: 3
Sell days this month: 21
Sell days this month last year: 22
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: +1
Amazon has a short history with the internet wine shipping game. The company invested $30m in 1999 in a 45% share of Wineshopper.com, a start-up that expired the following year, according to the FT. Wine.com currently sells food gift baskets on Amazon's site, but not wine.
While Amazon declined to comment on its plans for internet wine orders, the company said it will add wine and beer to a pilot fresh grocery delivery service, Amazon Fresh, that it is currently operating only in its home city of Seattle.
The point is that shipping wine ain’t easy. The article comments that “some smaller e-commerce sites have been shipping wine to customers in defiance of state laws, taking advantage of the difficulty state regulators face in identifying unmarked small shipments to individuals.”
Amazon getting involved in wine shipping could spell bad news for the wholesaler cause. Amazon could join the legions of Costco, wineries and other retailers that are working to overthrow state laws that restrict or ban them from bypassing wholesalers. It will be an interesting case to watch. If Amazon does in fact add wine to its long list of merchandise, wholesalers, retailers and wineries could have a lot more court cases on their hands.
SPIRITS GAIN TRACTION IN JANUARY
Who says spirits growth is slowing? The spirits biz had a great month in January, according to IRI, with especially strong dollar sales growth and promising volume growth. In the four weeks to January 27, 2008, dollar sales grew an impressive 7.8% and volume grew an equally impressive, although slightly slower, growth of 4.9%. As a point of reference, dollar sales were up only 2.3% in December and volume grew at a much lower rate of 0.8%.
Several spirits companies have reported that sales were slower in November and December, and we’re certainly seeing those trends in the numbers. All spirits categories performed better in January. IRI also shows evidence that while the value segment might be in decline, super-premium and ultra-premium brands continue to grow. For the year ending Jan. 27, spirits dollar sales were up 3% and volume was flat.
VODKA. Vodka dollar sales increased 9.6% in January and volume was up 7%, which is an even stronger performance then in December (up 5.8% and 5%, respectively). All of vodka’s price categories are growing, particularly in the super-premium and mid-value groups. Dollar sales of ultra-premium vodka grew 12%, super-premium increased 47%, premium was up 7.8%, mid-value grew 13.7% and finally value grew 7.3%. Volumes for super-premium and ultra-premium vodkas grew at a faster rate, up 65.5% and 13.6%, respectively.
WHISKEY. Dollar sales of whiskey grew 6.5% in January, while volume rose 2.1%. The highest rate of growth continues to come from the Irish whisky category, with dollar sales up 39% and volume up 42.5%. Dollar sales of Scotch grew 4.1% and volume declined -1.6%. North American whiskey rose 6.5% in value and 2.6% in volume.
Ultra-premium whiskey showed the most growth in January (12.3% in value and 5.2% in volume), followed by super-premium whiskey (9% and 6.6%). Premium whiskey is holding steady, while the rate of growth has stalled for both popular and economy whiskey.
RUM. Dollar sales of rum increased 9.8%, while volume was up 7.8%. Ultra-premium rum continues to show rapid growth, with value increasing by 91.3% and volume up 94.2%. All rum price segments showed growth, aside from economy rum. Dollar sales of super-premium rums rose 5.8%, while premium rums were up 10.7% and value rums increased 7.6%.
TEQUILA. Tequila showed the most growth out of all the alcohol categories, with overall dollar sales rising 13.8% and volume up 10%. Sales of the ultra-premium tequila segment rose 33% in January, followed by the super-premium segment with growth of 19.2%. Volumes were up 33.6% and 22%, respectively. Value tequilas ($9.99 and below) saw volume rise an impressive 30%, while dollar sales were up 13.4%. Premium tequila’s dollar sales, meanwhile, rose 4.5% and volume was up 3.5%.
GIN. Ultra-premium gin declined by -10.7% in both dollar sales and volume. Premium gin grew 6.5% in value and 4.8% in volume, while value gin sales grew 0.1% and volume declined -2.6%. Overall, gin grew 2.6% in value and declined -0.9% in volume in January.
WSD BRIEFS:
A WISCONSIN BILL BARRING WINERIES FROM SHIPPING TO RETAILERS, including restaurants, bars and grocery stores, passed the legislature last week and now awaits the Governor’s signature.
COSTCO SAME STORE SALES rose 5% in February for the U.S. and 3% excluding recent gas price increases. Net sales for the second quarter increased 12%.
Until tomorrow, Megan
“The power of accurate observation is commonly called cynicism by those who have not got it.”
-George Bernard Shaw
--------- Sell Day Calendar ----------
Today's Sell Day: 3
Sell days this month: 21
Sell days this month last year: 22
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: +1
posted at 1:10 PM
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