Picture from Penny Haywood Calder
Wine lovers have their own individual preferences. There are those who go for the whole experience, making sure that the temperature is just right, savouring the bouquet from the cork and giving (say) a red wine just the right amount of air to make the flavour perfect. Such people may also pay a premium to buy their wines in specialist stores which stock named vineyards with exclusively looking labels.
Wines from a supermarket
Others, by contrast, are happy to let the supermarkets make the choice for them. They go for the products made in the vast wine producing vats of California or South Australia. They’re happy with a bottle with a screw top and a price that means that they’re paying about the same for the drink as for the ready-meal on a week night. There’s no snobbery about it.
The newcomer on the bloc however fits none of those stereotypes. The 150,000 people who’ve joined Naked Wines in the past few years aren’t just consumers; they’re investors as well with a say in where the money goes. In return, they get discounts on the wines they buy and the chance to meet the wine makers on a regular basis.
The idea came from the mind of a South African born entrepreneur called Rowan Gormley.
Naked Wines Home Page
His background is in finance, not the drinks industry. He first trained as an accountant and then as a venture capitalist before going to work for Richard Branson. Virgin Money was his brainchild. But he saw wine as a potential opportunity before the turn of the century, setting up the business that eventually became Virgin Wines (after Branson bought it).
That company runs on a standard model. Like the supermarkets, it employs agents to trawl the world for the best wines at the best price and then selling the result to consumers.
Rowan Gormley
Founder of Naked Wines
Naked Wines operates on very different business strategy. It doesn’t just buy wines; it actively supports independent wine producers, investing some quite substantial sums to allow them in some cases to leave secure employment. But the key is that it’s in effect crowd funding the whole process and giving the consumer a real say in the process.
The company is now supporting 105 wine makers in 65 places around the world. While it started in the UK, it’s spread its influence and membership (members are known as “angels”) to places such as the USA and Australia. Each of those “angels” pays £20 a month which means that, with 150,000 of them, the firm has £36m to invest in a year. And as CEO Eamon FitzGerald points out, “the more angels we get, the more investment we can put in and the better experiences we can give to our angels.”
Eamon FitzGerald
CEO Naked Wines at the tasting in Edinburgh
He believes that good thing about the model is that, “because we support independent producers and your money goes directly to the wine maker, it means that the customer has a direct link with the vineyard. It’s less about the grape variety or the brand and much more about the juice inside the bottle. The angel’s money is spent on quality rather than marketing, the cost of cork or fancy packaging. In our model, only three things count – grapes, talent and time.”
The company has a policy of bringing the wine makers and consumers together by organising tours around the UK. The latest of these has just been to Edinburgh where some 500 “angels” came to meet the producers at Murrayfield. Everyone’s at great pains to stress that one of the best experiences for a wine drinker is to share a glass with the person who actually made it. And it’s clear the wine makers also like to meet their consumers face to face.
Benjamin Darnault
Wine Producer
Take the French producer Benjamin Darnault. He works in the south of France, in the Minervois region. Some three years ago, he saw an announcement that Naked Wines were looking for wine makers to work with them.
“The founder came out to see us,” he said, “and we showed him round the project I had, sourcing grapes around the area. They invested in me, allowing me to buy in the wine and ordered large quantities, enough for me to start buying more wines and producing great wines at great value.”
He doesn’t have his own vineyard. Instead, he works with many small producers, advising them as a consultant and then buying their output turning it into magnificent all too quaffable blends of red and white. He insists that “I don’t believe I have my own recipe for good wine; there’s no magic thing except for looking after the little details, getting the best fruit and having patience.”
Felipe Garcia
Wine Producer from Chile
Felipe Garcia from Chile has been supported from 2009. He and his wife had been employed by one of the large wine producers but had started around 2006 to produce our own product. As he told me, “we presented our project to the media and had a lot of success. But (our employer) got a little jealous and fired us in the middle of 2009 – exactly at the time Naked Wines got in touch with us. They asked, now that we were free, could you make wines for us and there was only one answer.”
A similar story some from Rod Easthope, a New Zealander based in Hawkes Bay on the east coast of North Island. He’s been making wine since graduating in 1992 and until about 18 months ago had been the chief wine maker at Craggy Range. It was then that Rowan Gormley approached him, asking him to make wines on the side under his own name.
Rod Easthope
New Zealand Wine Producer
“That didn’t really fit with the way my existing employer worked” he said. “But a week later, Rowan called back and told me that they wanted me to make so much wine that it was worth me leaving my job to do it. It’s been great having the investment behind me, being able to pay for the wines on the day we take delivery of them. I think that taking out a lot of the trade between the grower and the consumer has been quite incredible. It’s daunting, even brutal, at first. Consumers as individuals aren’t always spot on but as a mass they’re very sensitive to quality.”
And he’s convinced that meeting those consumers is a vital part of the process. “!We always see a great pick up in the wines after trips like this. A lot of people already know us and just want to make contact. There’s nothing like meeting people in person.”
That’s a view shared by Benjaim Darnault and Felip Garcia. “It’s important for us to meet the consumers,” explained Mr Garcia. “The business model of Naked Wines is unique as they give the decision power to the people. In this tour, you have the chance to meet about 500 people each day and these are real consumers, not potential ones.”
Vineyards at Hawkes Bay
“Coming to an event like this we get a lot of feedback,” adds Benjamin Darnault. “It’s very rewarding. Most of the wine makers around the world never get the chance to meet the consumer – they meet the buyer or the agent for the supermarket. Here you get genuine people who really appreciate the wine and we’re here to give back what they’ve been investing in.”
And the business model appears to be a success. Earlier this year, the company announced its first operating profit, growing its sales by 54% last year. That’s a year ahead of plan. As Eamon FitzGerald points out, “When we first started, the critics thought we were crazy. They said we’d never beat the supermarkets on price. Well we’ve done than and managed enough customers behind us to allow us to match those prices. They said we’d never get serious wine makers to work with us. Look around the room we have some big hitters who left good, secure jobs with the big wineries to become specialist producers. And finally, they said we could never make any money. We’ve proved them wrong on that as well.”