Amazon stops selling wine before it ever starts; Wine blogs on

logjamBack in March 2008, when word leaked out about Amazon’s possibly selling wine, Mike Steinberger asked, hopefully, whether could end the war over direct wine deliveries. He continued: “the entry of the Internet retailing colossus into the business seemed just the thing to finally break the logjam over interstate wine shipping.”

Instead, the logjam crushed Amazon (AMZN). Late Friday, ran a story that Amazon was putting its wine retailing business on hold, citing correspondence between amazon and wineries. I contacted members of the AmazonWine team for comment and they were either away on vacation reply or said that they could not comment. The Wall Street Journal got through to a spokesman who confirmed the wine trial was over.

The intractable logjam was the interstate shipping laws that govern interstate wine shipping. You can get 200 pages or so on it in my book Wine Politics: How Governments, Environmentalists, Mobsters, and Critics Influence the Wines We Drink. Or you can check out Tom Wark’s post for a more concise background on the logjam known as the three-tier system. Further, California law on unlicensed “third parties” may have affected the group’s plans.

I look forward to the final analysis of how exactly Amazon attempted to achieve a different structuring of interstate wine retail and why, sadly, it flopped. While AmazonWine kept program was kept under wraps, conventional wisdom is already blaming the bankruptcy of New Vine Logistics, which put the domestic wine component in jeopardy (imported wines were also to be available).

Given the economics of shipping wine, the company may have been targeting higher-priced bottles. In that regard, the economic backdrop didn’t help the plan as high-end wine sales have softened in the past year even though overall consumption of (lower-priced) wine is slightly higher.

In other news, ran a piece late Friday piece entitled, “Must-read wine blogs.” It’s a must-read itself and will give you some tips on some more blogs to add to your feed reader, if those good ones mentioned are not in yours already.

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8 Responses to “Amazon stops selling wine before it ever starts; Wine blogs on”

  1. Great post. If you ever want to compare notes with a French winemaker/American Importer/Florida Distributor, I’d love to talk! People need to seriously look at the many impediments between wine makers and wine drinkers.

  2. Even before the changes at New Vine Logistics, I am not certain Amazon had yet figured out the complexities of wine shipping. I was discussing the possibility of having our wineries (Siduri & Novy) work with Amazon and I inquired about how they were going to deal with the problems presented by summertime shipping. The reply was that they hadn’t figured that out yet, they would probably just ship during the summer the first year and see how it worked out. Not a confidence inspiring answer.

    Adam Lee
    Siduri Wines

  3. Nice pickup from Forbes. Congratulations!

  4. I read many of the blogs mentioned in that article, does that mean I have good taste? Congrats on your feature, Tyler.

    I’m disappointed in the toppling of this venture, perhaps it will be revisited some point later down the line. I had hoped as you mentioned, that it would generate forward progress regarding direct to consumer shipping. It says something when a company as large as Amazon is having trouble cracking the code.

  5. well, this is not surprising in the least. Amazon should have actually hired someone who had a background in selling wine online – instead of auction house experience. anyone google ms rao background? if they had, they would have realized that it’s not (yet) a viable business model. i know, i used to work in the online wine business myself and got back into brick and mortar.

  6. […] Blog | Amazon’s Exit From Wine Business Shouldn’t Hurt Wineries’ Online Sales DR. Vino | Amazon stops selling wine before it ever starts; Wine blogs on Vinography | Did You Hear That Sound? Wine Retailers Sigh in Relief Winery Website Report | The […]

  7. Have you guys used/seen Vinifera Boutique? They have a really nice website and seem to sell a really decent selection of french wines but I haven’t heard of anyone that has used them before.


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