Wine.com Launches Third-Party Marketplace to Take on Amazon
In a preemptive measure, Wine.com opened an online marketplace on Monday for third-party sellers to sell and distribute their wines amid reports that Amazon is planning to launch a similar business later this year.
The marketplace, which has been in beta for some months, allows wineries to list their wines for sale in 20 states. Participating sellers must deliver their goods to a Wine.com storage facility; Wine.com handles all shipping, warehousing, compliance and customer service. Subscribers to Wine.com’s $49-per-year free shipping service — its version of Amazon Prime — will not have to pay anything extra for Marketplace wines.
Michael Osborn, founder and vice president of merchandising at Wine.com, said that the Marketplace opens up new opportunites for smaller wineries that do not sell wholesale, and give shoppers the ability to purchase selections typically only sold in tasting rooms.
Amazon is expected to launch its own third-party Marketplace for wine sellers before the end of the year. The online retailer invited around 100 wineries to an event in Napa, Calif. in late September to introduce them to the program. Wineries will be able to list their products through Amazon, but like other Marketplace sellers, they must handle shipping and compliance on their own. For that service, Amazon is charging wineries a $39.99 monthly participation fee, plus a 15% cut of every sale, according to Sonoma’s Wine Industry Insight.
A spokesperson for Wine.com expressed confidence that the company’s offering would be superior to Amazon’s, both for customers and sellers. Unlike Amazon, Wine.com will be handling most backend logistics operations, and also promises to ship wines from multiple sellers in one box — a necessary convenience for buyers, since orders require an adult signature. It also appears that wines sold through Amazon’s Marketplace will not be available for free shipping through Amazon Prime.
Amazon’s major advantage is, of course, its size. According to a Forrester research survey released in July, 30% of online buyers say they start their shopping search at Amazon — twice the number who start with Google. Wine aficonados may see the advantages of Wine.com’s subscription shipping service, but for the more casual or incidental buyer, Amazon is more likely to fit the bill.
Image courtesy of Flickr, isante_magazine