This is part of a series on the Naked MarketPlace, a new initiative from my UK importer that allows any winemaker on earth to sell wine to members of their site. This first post will explain the basic premise of the MarketPlace. Future posts will explore how exactly the marketplace works and how it might affect the future of the wine business. I’ll specifically be looking at my first experience placing 100 cases of my Proprietor’s Reserve 2006 on sale through the Naked MarketPlace.
What is the MarketPlace?
MarketPlace is a platform like ebay or groupon that allows wine producers to “pitch” their wine to the UK market. It’s not EXACTLY like ebay or groupon, but it has a lot more in common with those style websites than with traditional wine importers. Traditional wine importers buy wine and resell it, assuming a large amount of risk, marketing costs, storage costs, and so on. The Marketplace puts producers in direct contact with a group of final consumers and wine doesn’t get shipped until its all presold.
The MarketPlace launched at the London International Wine Fair in May 2011.
Specifically, the site allows producers to put a wine on sale at any price and offer it to the UK market. If enough people buy the wine at that price, than Naked Wines (the importer) pays for the wine and brings it into the UK, sending it straight onto the consumer. Naturally, Naked will be charging a commission and some of their overhead (excise, transport, etc), but all that is made abundantly clear when the producer goes through the pitching process. If I pitch a wine at 2 euros per bottle, the site will tack on all the charges and commission and change the currency and display the final consumer price. So I’m paid the 2 euros I asked for and I see the final price offered to the customer.
If a wine fails to sell its minimum amount, then something else happens. Throughout the bidding process, customers at Naked Wines have two options: “Bid current price” or “Offer a lower price”. This second haggler’s option allows a person to speak up if they would have bought the wine at 1 pound less per bottle. If a pitch is unsuccessful, the producer can look at the lower offers. And hopefully, the producer will realize what price point the wines need to be in to make a splash in the UK market. I’ll look more at this specific aspect of the marketplace later on.
Who shops at the marketplace?
Naked Wines has a rather large customer base (175,000 drinkers). And we’re not talking one time buyers. Naked has customers who are paid members of the site. They pay 20 pounds per month and get that money in cash back on future purchases in addition to certain member-only discounts.
These members are all encouraged to take a look at the deals offered in the marketplace and they will hopefully all bid on the steals they find there.
Who will sell on the marketplace?
Literally anybody can access the marketplace producer platform.
I imagine that producers who already have a track record on the site will be eager to use this platform to move lots of wine at a smaller margin than what Naked Wines normally takes. Essentially, as Naked cuts its mark-up down to a 10% commission, it’s left to the customers and producers to haggle over the savings. That means a little more money for producers and a little less cost for the customer. Having a proven track record on the site guarantees a certain level of quality for wine on the marketplace.
On the other hand, producers who have absolutely no track record might also benefit from this. They’ll have to fight a little harder and maybe offer the wines at a lower price to get things started, but these producers will eventually build up a reputation. Alternatively, they can send a few dozen sample bottles which will be given to the most vocal members of the Naked Wines customer community in the hopes that this will start some buzz on the site. I’ll address this in more detail later too, as early experience make me slightly hesitant about the potential to build up a reputation.
No more whining
Essentially, the most important development regarding the Marketplace is that wine producers no longer need to depend on traditional importers. If you think you make great wine and all you need is a chance to be on the UK market (there are a lot of us in that boat saying “If only an importer would give me a chance”), you now have that chance. Pitch a wine on the marketplace. See how things go.
Frequently Asked Questions
There are some FAQ on the naked wines site.
Of special interest to my readers, here is the winemaker section of the FAQ:
Q&As for winemakers
Who are Naked Wines?
Naked Wines is an online wine retailer who supports independent winemakers from around the world – with over 150K customers. On average, we ship over 10,000 bottles of wine a day.
What’s Group Buying and who is it for?
Naked MarketPlace is an online farmer’s market where winemakers can pitch and sell their wines directly to UK wine drinkers – at a price which works for everyone. Winemakers name their price, based on selling a minimum number of cases – and wine drinkers can either accept the price and bid OR they can suggest a lower price (which the winemaker may or may not accept!).
What are the costs?
There is NO cost for pitching your wine to our 150,000 customers. Simply 20 minutes of your time to upload your product on our website! We charge 10% commission if the pitch ends successfully – and if the pitch falls through, we won’t charge you a thing.
What are the risks?
There are no risks. You set the price, you set the volume. If enough customers want to buy your wine, great – the deal is done. If not, you walk away.
Who decides on volumes and prices?
As above, you’re in control and you set the price and minimum and maximum volume. Customers can bid to pay a lower price, but it’s up to YOU whether you accept or not.
Once I’ve uploaded a product, can I change my mind and remove it?
No, once it’s live you cannot remove your pitch. BUT if you’ve made a mistake then please email us at email@example.com and we can help.
Can I change the price and volume once a pitch is live?
Customers can reject your price and suggest a lower price. IF you agree with their suggested price, you can accept their new price BUT you can’t change prices yourself once a pitch is live. You can’t increase or decrease volume either.
Does Naked Wines provide technical support and selling advice?
Yes. If you need any help or advice you can contact us on firstname.lastname@example.org
How long does each pitch last for?
Seven days. It will end automatically after this time – whether you’ve reached your minimum number of orders or not.
Can my agent (or someone else) manage or set-up a pitch on my behalf?
Yes. Although this is NOT the place for agents to offload dodgy old stock that they can’t shift – as customers simply won’t buy it.
Can I set-up more than one pitch?
Yes, you can sell as many different wines as you like.
Can I mix up wines in a case?
No, your pitch is for 6x one type of wine.
Will it affect my brand and can I work with other retailers in the UK?
You can work with as many other retailers as you like – and charge whatever price you like elsewhere. Group Buying is NOT a traditional retail channel, so you’re not compromising your brand in any way. In the same way restaurant prices and retail prices differ for the same product, Naked MarketPlace prices differ to normal shop prices.
How can I drum up excitement about the product?
Make sure you upload interesting product information and a good picture! It’s also a good idea to chat to customers on the website. We will email you every time a customer asks you a question and explain how to reply. You can also ship our customers free samples if you want them to try it. We have a group of customers called Archangels who are a very powerful sales force – and will spread the word!
When will I get paid?
Once the deal has ended, you need to deliver your wine to and our hub in your country within FOUR weeks. Once delivered, we will get the wine chemically analysed to make sure it’s EU compliant. As soon as we’ve got the certificate, you will get paid within 10 days. If the wine doesn’t pass the test, we will return it to you and you won’t get paid. N.B. If you don’t stick to the deal and deliver the wine on time, we won’t want you pitching any more wines in the Naked MarketPlace – as we don’t want to let customers down.