After our class during which the discussion went from charming Old World Premier Crew Chateaux Pontet Canet all the way to pragmatic, modern and somewhat controversial Maker wine, I took time to reflect on the multitude of startups and fresh business models that aim to alter the landscape of wine industry and redesign the way the wine is produced, distributed and consumed - from grapeless wine to AI driven pairings to single serving bottles to canned wines to establishing direct and personalized relationships with consumers. The future of wine in USA must be nimble and adaptive. The way we think about it in VINEBOX is 'toppling tradition, respecting the heritage, and inviting everyone to the party'. To me personally, wine production is the form of art and toppling traditions matter: wine has been produced for thousands of years, initially cultivated and spread around the globe by Phoenicians, changed in the course of history and ended up becoming the most noble and history-rich beverage in the world which as everything unique and desired has many attributes and ceremonies around it. I enjoy tasting both new and old world wines and match their distinctive qualities with specific type of soil, method of production, type of oak used all to refine my palate and sharpen my ability to recall wines. Overall wine tasting is massive learning journey for me and I can't imaging bypassing any of the 4 steps (being look, smell, taste and think).
Many companies in this day and age have found different unique way to package wine, nonetheless it feels like cans have been explosive in omni-channel, there is an objective mismatch in taste and touch which is hard to get over. I think the argument of Maker's founders regarding beer transition from bottles to cans is fair but It still seems to me that it has been easier / different because aroma component is not necessarily part of tasting experience. My question becomes when you put a nicely designed glass bottle of wine next to a can, what will consumer pick?
From venture capital perspective I think Maker Wine represents an interesting opportunity especially considering their sales and distribution channel development approach but I have my reservations over their ability to become mainstream and grow to billion dollar business simply because barriers to change consumer behaviors and preferences are sky high.
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ReplyDeleteI think Maker Wines will stay niche. Their value proposition is to make wines more accessible to the next generation. Wine consumption is decreasing among younger millennials. Novel packaging, in the form of cans and attractive design, may entice undecided wine drinkers into giving it a try. From there, hopefully they will start exploring the world of wines. That said, I agree that Maker Wines will find it difficult to scale. After all, canning can only work for a limited range of wines- wines that need to age for example will not be able to do so in a can. Given that canned wines is a small SAM and that there are many competitors in the space, it will be challenging for Maker Wines to achieve a sustainable share of the market to begin with. Their only chance would be to convince consumers that canning wines makes the wine a better one- an uphill task.
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