home Finance, General News Wine Sales on the Internet: a “crucial channel” and Great Potential

Wine Sales on the Internet: a “crucial channel” and Great Potential

Online Wine Sales
A man tasting wine at the Vinexpo wine fair in Bordeaux, June 15, 2015 – Jean-Pierre Muller AFP

Selling wine online has become a “crucial channel” for distribution …

Selling wine online has become a “crucial channel” for the distribution of wine and even if purchases are made mainly in wine shops or in-store, the internet has a high growth potential, say the authors of a study published yesterday, Monday in Bordeaux.

According to the fifth international study of the best websites selling wine, produced by the Kedge Business School of Bordeaux, the wine online market is constantly growing since 2007 and increased by 36% in 2014.

Some 9% of wine purchases are made online this year in France with more than 387 e-commerce sites, specialized or not, who made a billion euros in sales. The current projections expect a 50% increase in 2016, to 1.5 billion euros.

In the US, the leading wine market in both volume and value, selling online is worth $ 1.5 billion, for a 4% share of the sales online market.

Grégory Bressolles, research professor at the Kedge Business School and author of the study, “2015 was a turning point.” “The market can not be decrypted only by the angle of the online wine merchants.  It no longer depends on them, their strategy, their tender.  It now depends on buyers and their behaviours, “he said.

An opinion shared by Matthew Lesne, co-founder of Small ball site selling wine online through a subscription system: “There is everything to do, and that’s good: the world of wine needs to be shaken. The new customers knowledge is greater now and knows what he likes “to be able to make appropriate comparison and negoitiation”.

Competition and lack of profitability

The French 387 online retailers surveyed in the study have various different profiles.  39% of them are only selling online such as  privée.com or Cdiscount, then your market leaders, the major specialists such as  Vinatis, Wine and co and then the small niche players (only one region, foreign wines, organic, etc.).

The larger companies who own physical high street stores and are online, are Nicolas and Lavinia, having a 32% market share.

The supermarkets account for only 2% of the market plavce but a large share of turnover. However, they “see e-commerce as a competitor channel their stores and not as a strategic at present” said the study.

The bankruptcies of the companies 1855.com or chateauonline.fr have aroused  dissatisfaction with many customers who never got their orders and has also damaged the image of the sector and left some doubt about his future.

For Mr. Bressolles, “the online wine sales market will be dominated by sites with a large database and those that may be based on a physical presence on the high street”.   “Traditional physical shops have not yet found the optimal model” and “pure players of wine are likely to be the victims of the concentration process of the market” in full structuring, he analyzes.

Not surprisingly, the site amazon.com ranks first in the charts of the 5th International unveiled Monday followed by the Chinese site jiuxan.com and the spanish sites laviania.es and lavinia.fr.  Of the 21 French sites selected, sale-privée.com retains its number one spot but is being challenged by wine-indépendant.com, a direct sales website created in only four months by a network of independent winegrowers from all over France .

“We have been makers of wine for over 35 years and we realize our limitations, we needed this new site to offer a new service for customers lost in our rooms, our new customers – mostly young and connected,” said Cédric Coubris, Vice President of Independent Winegrowers of Gironde, also indicating the willingness of the network to grow in Europe.

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