One of the country’s most successful internet marketers of wine is jumping into the spirits game. Wine.com, which distributes wine in almost all of the United States—and is fairing well with millennials—has opened its warehouses to sales of stronger alcoholic beverages.
The company launched spirits sales in New York and Florida last month and will be selling in New Jersey as of this month. Plans for September are to start selling higher-proof tipples in California.
I recently interviewed Addie Wallace, Wine.com’s San Francisco-based director of new business strategy and insights about the company’s move into spirits sales.
All responses have been edited and condensed for clarity.
Liza B. Zimmerman (LBZ): Why did you decide to launch spirits sales? Why was it a natural progression for Wine.com?
Addie Wallace (AW): We’re excited to now offer spirits on our platform. The decision to enter this market was an easy one for a few reasons. First, our customers were asking for it. In addition to drinking wine at home, they also enjoy mixing their own cocktails and until now they had to shop at two separate retailers to do that. Now they can meet both needs with convenient, one-stop shopping on wine.com.
Second, in addition to customer demand, there has been a general expectation that we would sell spirits. Consumers are trained to shop for wine and spirits together because almost every brick and mortar retailer offers both. And now we do too, with the ease and convenience of shopping online.
Lastly, the spirits business fits the operational infrastructure we’ve built for wine. We use the same distributors, warehouse processes and packaging, which makes execution relatively simple.
LBZ: What other states will Wine.com roll out spirits sales into?
AW: In terms of our state footprint, we launched New York and Florida in July and will be launching New Jersey and California in August and September, respectively. With just four states we already have one of the largest national footprints for spirits online.
LBZ: Will you be focusing on private label or selling known brands?
AW: We’re taking a similar approach to our spirits assortment as we’ve taken with wine. We do not carry any private label products (in spirits or wine) and take pride in offering a large assortment of quality products from both well-known brands, as well as boutique, artisanal producers.
Today we offer the largest selection of wines in the world and expect to mirror that in the spirits category very soon. In order to offer this breadth, we specialize in long tail products that are not available in your everyday liquor or grocery store. For the consumer it is tremendously valuable to have a single place where they know they can find what they are looking for, be it something special with limited allocations, or to discover something new and different. In spirits specifically, this means we will carry many of the rare and limited-edition spirits coveted by mixologists in addition to the big-brand names.
LBZ: Will you specialize in any specific type of spirits?
AW: We’re not specialized in any particular type of spirit, as we are going to focus on all of them: whiskey, vodka, tequila, mezcal, gin, rum, brandy, cordials, liqueurs and more.
LBZ: How competitive will pricing be?
AW: Aggressive pricing is also an important aspect of our strategy. When combined with StewardShip, our free shipping program, this will make us the least expensive source for spirits in the market, among online and brick and mortar retailers.
LBZ: What percentage of your total sales do you expect spirits to eventually account for?
AW: It’s still very early, so it’s difficult to say exactly how big this business will be, but we expect spirits to be a meaningful source of growth going forward.
For many brick and mortar retailers, spirits accounts for up to half of their revenue so we know this is a huge opportunity. We look forward to further serving our current customers who enjoy both wine and spirits at home, as well as meeting the market demand for spirits as a stand-along category.