Jeff Stai On Amazon.com's Wine Program
Jeff Stai (El Jefe) of Twisted Oak met with Amazon representatives last Thursday, and here is his report (left as a comment on a previous Amazon-related post):
OK, so I am reporting back Sunday (just back from a very successful two-day tasting event with the TAPAS organization.)
Pretty much everything has been covered by other comments in the several posts on this. They are going for smaller wineries, and the wines will sell for a minimum of $12. The winery commits to selling the wine, Amazon comes and picks up the wine and deals with everything else - including compliance paperwork, shipping problems, etc.
Fans of the Amazon Prime program will be pleased to know that Prime will also apply to wine shipping - and only a two-bottle minumum order! [Yippee! - Editor]
It won't be 45 states but rather 27 states in the initial rollout. One possible barrier to entry for some wineries is that the winery must pay all regulatory fees for label registration in those 27 states (Amazon estimates that to be about $400 per label.) That is a startup cost and the yearly renewals will be less. Amazon does the paperwork. Note also that if a winery is already registered in a state, another registration must be done since it is a new 3-tier path. And, a winery must commit to all states that Amazon will ship to - you can't pick and choose states.
Thanks, Jeff. You're the best. One question: How do wineries who want to participate in this program get in touch with Amazon? Or is it "Don't call us, we'll call you?"
A couple more questions
1. If you met as part of a group, any reactions from other wineries?
2. Will Twisted Oak be participating? In what way?
Thanks again, Jeff!
Posted by: Mike Duffy | August 11, 2008 at 01:15 PM
I had a long conversation with Amazon as well...and everything you said Jeff was what I heard, except for the smaller wineries thing. My contact told me that they are not gate keepers, and that anyone who wants a page on Amazon can have one. Also, never heard anything about the prices starting at $12.
Posted by: Cheryl | August 11, 2008 at 03:23 PM
That's actually a good question - Amazon contacted our local wine assn. for the meeting. I would expect that they will be contacting other regional groups as they can. Amazon has quite a task getting everything in place by the end of Sept. and I would imagine they are trying to limit the workload.
Reactions from other wineries relates to the statement I made about a "barrier to entry" for smaller wineries. What I meant was that some smaller wineries might see the $400 per SKU as a barrier, meaning it was more than they would be willing to pay for entry into this program. That was at least the reaction from some wineries at the same meeting. As Cheryl pointed out, any bonded winery can have an Amazon page if they want one. (The $12 min price was given in a response to a question, and was not part of the presentation.)
We hope to be one of the first wineries launched with the site - stay tuned!
Disclaimer - all of the above is what I thought I heard about what I thought they meant. Interested wineries should seek this info directly from the source.
Posted by: el jefe | August 12, 2008 at 10:48 AM
That's actually a good question - Amazon contacted our local wine assn. for the meeting. I would expect that they will be contacting other regional groups as they can. Amazon has quite a task getting everything in place by the end of Sept. and I would imagine they are trying to limit the workload.
Reactions from other wineries relates to the statement I made about a "barrier to entry" for smaller wineries. What I meant was that some smaller wineries might see the $400 per SKU as a barrier, meaning it was more than they would be willing to pay for entry into this program. That was at least the reaction from some wineries at the same meeting. As Cheryl pointed out, any bonded winery can have an Amazon page if they want one. (The $12 min price was given in a response to a question, and was not part of the presentation.)
We hope to be one of the first wineries launched with the site - stay tuned!
Disclaimer - all of the above is what I thought I heard about what I thought they meant. Interested wineries should seek this info directly from the source.
Posted by: el jefe | August 12, 2008 at 10:50 AM
I also was told that the wines would be sold for a minimum of $12. It was not in the presentation I heard yesterday, but was said in response to a question. Does this mean they will really hold it to $12? Also, they said that customers will be able to post comments about the wines they have purchased. Who will moniter this and make sure that people are not bashing wines? I mean, not everyone has a sophisticated palate and I'd hate to see a winery get dinged when they don't deserve it. Or will the posts be limited to positive comments only?
Posted by: Me | September 05, 2008 at 10:54 AM
Amazon reviews can be positive and negative, so I doubt there will be any monitoring (although, a winery will want to pay attention to reviews and comments).
Do sophisticated wines not taste good? :)
Posted by: Mike Duffy | September 05, 2008 at 11:04 AM
No, but people without a sophisticated palate may think a wine is bad when it is not, or more importantly, might open a bottle that is corked, not know it, then say that the wine is horrible. People will read that and not know that the particular person is Hobo Joe from the Pike Place Market, or from under the Goerge Washington Bridge. Amazon says that they will assume responsibility for bad wines, but HOW?
Posted by: me | September 05, 2008 at 11:50 AM
Does anyone have the Amazon buyer's ( or the buyer team) contact info?
Posted by: Amy | September 13, 2008 at 09:52 AM
Michael Gelven, CWE
Senior Buyer, Wine
701 5th Ave.
Seattle, WA 98104
(707) 319-2137 cell
(206) 226-9065 office
mgelven@amazon.com
Posted by: me | September 18, 2008 at 04:37 PM
What states are exempt regarding amazon wine?
THANK YOU
Posted by: JACK D'AGOSTINO | September 21, 2008 at 08:01 AM