Is wine recession proof?

posted by philip in Wine

Clearly this is a hot topic, and something we think about a lot and try to infer data, based on site usage figures and other metrics.

Starting with Snooth. We saw our strongest week of traffic last week in over 4 months and our traffic has picked up over 20% in the last 60 days. We’re a young site and hardly representative of the dollars spent, so I wouldn’t use that data for anything, however, people are still searching for wine, so that’s a good start. Anecdotal evidence supports this.

Compared to the spirits industry, wine is rock solid. Users have been migrating from spirits to wine for several years now and the winery businesses are the jewels in the major drinks company’s portfolios.

“Constellation Brands, the world’s biggest wine company by volume, said three weeks ago its first-quarter profit jumped 50 percent.” That combined with UST (snuff tobacco giant), who said that it was thanks to their wine portfolio that they limited their decline in profits as much as they did, presents some solid cases for the wine industry’s health.

On the flip side, we have data trickling in telling us that on-premise sales are suffering. Is this really a surprise? When times are tight, people are clearly going to be dining out less, and probably less likely to be springing for wine at triple the retail value. The same article references “off-premise” sales (grocery stores, liquor stores etc.) seeing just a 5% decline in sales over the past few weeks. It was a short study, over a limited number of participants in a single market, but ties in with Neilson’s predictions that wine might be “recession proof”.

This is backed up by the folks at Silicon Valley Bank who said that “wine is still an affordable luxury even in a bad economy. So while wine is not recession-proof — like electricity and visits to the doctor — people still continue to consume wine even during difficult times, and our experience is that wine continues to demonstrate volume growth.”

“Affordable Luxury” - I like that phrase, and although some may see wine as a ‘necessity’, for most of us, I think thats a the sweet spot. People who are buying $80 wines, probably can weather the recession, and for everyone else, while there may be a little trading down (I may buy $10 wines, instead of $14 wines) I still foresee people drinking a glass or two to unwind at the end of a long day.

Punch down and pump over

posted by philip in Snooth

OK, so I tricked you with the title - this isnt about winemaking. I’m just a few days away from taking (and passing? failing?) my Certified Specialist of Wine and cant think of much else at the moment. Certified Specialist of Wine (CSW) sounds fancy, but it basically involves me cramming half an encyclopedia of wine knowledge into short term memory, running into the exam room, shading in my multiple choice circles as fast as I can, and before my newly found knowledge leaks out, and then forgetting 98% of it all the day after the exam.

What I did want to ask you, however, is for some feedback on Snooth. I think at this point the basic concept is coming together (at its most basic, that would be “wine website”, but more realistically, something like “a place to discover and buy wine online”), we have a lot of ideas, and a big to do list, but we’d really like to hear some stories of how you use the site.

- do you just use Snooth as a price comparison site
- research online at Snooth, but buy in the store (thats ok by the way)
- use the site to track your notes and your cellar
- discover new wines through the community and the recommendations

- or something else…

Figuring out more about how you use the site, what you like, what you dont, and what you’d like to see will really help us determine what to focus our efforts on.

Whether you are a casual passerby, or a hard core user, drop us a line, or comment on this post and give us your 2 cents. Thanks!

Standing out from the crowd

posted by philip in Wine Industry

I recently returned from a few days in Grand Cayman (trip report here - if you want to read about my stingray bite) and i was going to write about how service levels can change when you’re a captive audience (think of the microblogging service Twitter - their service / uptime levels are appalling, yet people have nowhere else to go), but while I was there I started thinking about differentiation - standing out from the crowd.

Grand Cayman is a Caribbean island, I went there dreaming of curried conch, jerk chicken, rum cocktails and key lime pie. Yet, it seemed that every restaurant touted its “extensive French wine list” and its “superb Italian cuisine”. Coming from New York, I didn’t feel like trying the local twist on Pasta Carbonara, and so, ironically, it was the places serving local food that were most visible to us.

I think its the same with wine: critter labels themselves are not distinctive, it depends on the context they are viewed against. A screwcap, or a box wine will stand out against a sea of Bordeaux bottles - each with a stencilled sketches of their Chateau. The reverse holds true too - a traditional bottle, with gold leaf and raised lettering will probably stand out against a bunch of whimsical labels and cute brand names.

And so, at the end of a tough day of lying on the beach, when I wondered into the local liquor store to grab a bottle of wine, I found myself picking up the one thing that stood out from the crowd : the tetrapak box of Three Thieves Bandit Chardonnay.

Was it good? That’s irrelevant here - it was the fact that the packing got me to buy it.

Happy July 4th

posted by philip in Snooth

We almost went a week day without posting, but this one slips in just in time! If you’re not living in the US or American then this might not mean too much to you, but to those that are: happy Independence Day!

View of the East River fireworks in NYC