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Comment: Knowledge is the secret sauce of wine

When Majestic recently opened the doors to its latest store in my local area of Crouch End it very much highlighted the renaissance we are seeing… View Article


Comment: Knowledge is the secret sauce of wine

When Majestic recently opened the doors to its latest store in my local area of Crouch End it very much highlighted the renaissance we are seeing in bricks and mortar wine retail because it joins a crowded market including Humble Grape, Crouch End Cellars and Bottle Apostle who each have shops in what is a pretty small shopping area of North London.

While these businesses have each been confident about opening physical stores there has certainly been less confidence in the online channel for wine. In recent months there has been a meltdown at Naked Wines with the online-only business issuing multiple profit warnings, bringing back its founder Rowan Gormley, and giving its CEO the chop.

Among other things the company has suffered from the cost of online marketing to attract new customers while losing existing shoppers from the inevitable churn. The situation had been particularly acute in the US. Meanwhile, online-only rival Virgin Wines has also encountered difficulties, including a fall into loss as a result of inflation and issues with the implementation of a new warehouse. It is incredible how many retailers suffer at the hands of new distribution centres. It’s enough to make management turn to drink. If only more people in general were turning to the vino it might help the online-only wine retailers!

It’s not to say this is a wholly polarised scenario – with physical stores enjoying good trading and online suffering badly – because in recent weeks we have also seen the demise of the high street business Oddbins chain that closed its final handful of stores following a protracted decline over many years. It suffered from a failure to embrace a batch of increasingly important elements such as a multi-channel model, ranges tailored to individual locations, passionate employees, and a hybrid approach that mixes retail with on-the-premises consumption.

The likes of Majestic along with the many top class independents that have sprung up have each adopted elements of this mix although not all are required for success. But where there is a commonality is with the focus on telling the story of wine. This is undoubtedly where the real value of physical retail comes into play. Nobody has to really spend more than £8 in reality for a drinkable bottle of wine but a quality wine shop with passionate, knowledgeable employees can upsell to more expensive bottles as long as they know their Assyrtiko from their Nebbiolo and understand the needs, aspirations and affluence of their individual customers.

Recognising this as being a crucial ingredient in the secret sauce of wine retailing Majestic is doubling down on bricks and mortar through the roll-out of a variety of store sizes including a compact format as seen in Crouch End. The plan is to open a new shop each month over the next few years and to push through this strategy the company has just created two new roles to bolster its property capabilities. Stuart Williams joins from Travelodge as director of estates and acquisitions while Andy Latham has been promoted to the new position of director of format development and new store operations.

Alongside this the company has a programme for its employees to undertake wine exams so everybody has a full understanding of what is being sold. This might not exactly sound like rocket science but it is probably the key differentiator between successful and flawed wine retailing.

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