Wine's future may lie online

The wine industry is missing a huge opportunity to forge deeper relationships with consumers using new technologies such as Web videos and wine blogs.

That was the blunt message delivered to wine industry executives in Napa on Tuesday by a young, outspoken New Jersey wine retailer who said the industry needs to embrace change or die.

"Ninety-nine percent of the people in the wine business are really blowing it," said Gary Vaynerchuk, director of operations for the WineLibrary, a Springfield, N.J. wine store with a popular interactive Web site.

Vaynerchuk told more than 300 industry executives at the Wine Industry Technology Symposium that he has helped grow his family's small wine shop into a $45 million enterprise by aggressively adopting the latest technologies.

The store's e-commerce Web site has expanded to include blogs, reader wine reviews, and something called WineLibrary TV, which features videos of Vaynerchuk talking in a highly personal, in-your-face style about a range of wine topics.

Vaynerchuk launched the feature because he feels the industry has too long bowed to a handful of elite critics whose opinion means nothing to the average wine drinker.

Most people lend more credence to the opinions of other consumers, something wineries and other segments of the wine industry have been slow to recognize and face.

"Now everyone has got an opinion. Everyone's got their two cents. Every single person you cross paths with in this industry you need to fear, and you need to embrace," Vaynerchuk said.

Interacting with customers

He wasn't the only one preaching the potential new technologies have for changing the way wine businesses interact with consumers.

People are writing so much on the Internet about products that their ramblings today surpass the words generated by all other traditional media, said Max Kalehoff, vice president of marketing for BuzzMetrics.

Kalehoff's company, which was purchased recently by media research giant Nielsen, analyzes what people are talking about on the Internet.

"The fastest-growing media are not those that are created by journalists or by academic institutions or corporations. It's media that people generate themselves, people like you and me," Kalehoff said.

The importance of such "peer-to-peer" reviews to consumers' purchasing habits has grown significantly, he said.

In 1977, 67 percent of consumers cited worth-of-mouth recommendations as the single greatest factor they relied on in deciding whether to buy something. Today, that number is 92 percent, he said.

The proof is everywhere. Five of the top 10 references to Santa Rosa's Kendall-Jackson wines on search engine Google are consumer-generated references, he said.

About 73 percent of people who shop online leave comments behind to share their thoughts and experiences with other consumers, Kalehoff said.

The implications of these trends for wineries and myriad other businesses is that consumers expect the company to respect and engage them about their opinions. And that makes it more important than ever to have top-notch customer service, he said.

Embracing change

Criticism of companies and their products are now front and center for everyone to see, and companies should welcome this online discussion instead of fearing it.

"It's time to start thinking about the customer service department as the new media department," he said.

Some wineries become so paralyzed by the idea that someone will post something negative about their wines on their Web site that they don't add such functions to their site.

But smart wineries that are making good products should realize that they have nothing to fear from an occasional jab from consumers, Kalehoff said.

Vaynerchuk agreed. Wineries that are complacent and unwilling to engage new consumers in their own language will soon find themselves left behind.

"Get out of your comfort zone and embrace change," he said. "If you are scared, you are going to lose, and losing sucks."

You can reach Staff Writer Kevin McCallum at 521-5207 or kevin.mccallum@pressdemocrat.com.