A Revolutionary Time For Wine

Posted by Tom Wark on Dec 22, 2006

The Wall Street Journal’s wine guides John Brecher and Dorothy Gaiter produced a thought provoking year end article today on the state of wine and trends they see.

Among their most interesting observations is this one:

"The first isn’t about wine itself, but the selling of it. This is the
most revolutionary time in wine retailing since the end of Prohibition.
The combination of the rise of Internet sales and the U.S. Supreme
Court’s decision striking down some laws concerning direct-to-consumer
winery shipping has helped to create more of a free-for-all in wine
retailing than ever."

Spot on! This is a revolutionary time in wine retailing. The direct-to-consumer channel, be it winery-to-consumer or retailer-to-consumer, is in a state of mighty flux. Wineries are just now starting to learn how to use the Internet to cultivate a loyal customer base. Consumers are finding their choices are widening rapidly. Yet it is still important to note that we do not have a truly open national marketplace.

In large part this is due to the enormous influence the wine wholesalers across the country have on the regulatory environment. The astounding amount of influence they have purchased through "campaign donations" has resulted in remarkably anti-competitive legislation passing in a number of states, whether it is prohibiting winery-to-consumer sales, winery-to-retail sales or retailer-to-consumer sales.

2007 will be a watershed year for the prospects for consumer access to wine and a national market for wine. Lawsuits, legislation and lobbying will be the tools that either give consumers more access to the wines they want or limit consumer access to wine for the sake of preserving the state-mandated  monopolies and profits of the middle-men wine wholesalers.

There ARE heroes out there that are fighting the good fight on behalf of a nationwide open market for wine and on behalf of consumers:

Inertia Beverage Group
Specialty Wine Retailers Association
Free The Grapes
Coalition for Free Trade

Much of the battle for access to wine and against anti-competitive wine regulations will revolve around the media taking interest in the story. And the story is a compelling one: Just as the entire retail environment in America is changing due to new technologies and new attitudes by entrepreneurs, and just as the wine industry from California to Virginia is expanding choice and quality for wine lovers, the wine industry and wine consumers finds themselves in the grip of the one of the most anti-competitive cabals this nation has ever spawned; a cabal that will pay nearly any price, make any outrageous claim, foment as much inter-industry discontent as possible and buy up needy politicians at a remarkable rate.

I hope Gaiter and Brecher will keep their eye on the progress and machinations that occur during this revolutionary time in wine retailing. If they, or even their colleagues at the Wall Street Journal, exposed the desperate measures that are taken to prevent wine lovers from simply buying the wines they want, we would see an immediate response among regulators, politicians and consumers emboldened by merely reading the truth in a well regarded journal.