Amazon Gets Into Wine – AGAIN! (Updated Sept. 27)

Amazon is getting back into the wine business in time for this year’s holidays, according to Washington State sources close to the mega-online retailer who spoke to Wine Industry Insight on condition of anonymity.

Indeed, Napa and Sonoma County vintners who attended meetings this week are non-communicative because of non-disclosure agreements they had to agree to in order to be part of the new Amazon Marketplace for wine.

Similar to the existing third-party marketplace for other products (sold and shipped by some 2 million independent vendors) Seattle-area sources tell WII that Amazon wants to have the system for Napa and Sonoma up and running in the next four weeks.

Amazon has flirted with the wine industry for several years, but pulled back in October 2011 mostly over compliance and legal liability issues.

Update, Sept. 27: Amazon has been very specific (so far) that vintners participating in the Marketplace program must handle their own shipping and compliance.

WII has learned that Amazon has had talks with several major compliance and shipping organizations, but has not reached any definitive agreements and has not offered those sorts of assistance to participants.

DISCOUNT SHIPPING AND PROMOTIONAL INCENTIVES

Amazon is requiring a $39.99 monthly fee to be part of the program plus a 15% commission.

“Amazon is using its muscle with UPS and other delivery companies to provide low fixed rates to the vendors,” said one source close to the program. “I think those will be lower than any single vintner could get on their own.”

Amazon has promised special online promotions of wine through Christmas as well as its other product search and rating systems.

There are promotional incentives as well that will be offered to participating vendors such as rebates or discounts on credit card fees.

AMAZON CONTACT INFORMATION (UPDATE)

Numerous vintners from around the state have emailed Wine Industry Insight asking for an Amazon contact number.

Unfortunately, WII does not have don’t have any specific contact information it can pass along that wouldn’t reveal a confidential source. The best course would be to contact someone from a vintner’s association in Napa or Sonoma County.Our apologies, but any specific data could get Amazon sources in trouble.

COMPLIANCE & SHIPPING ARE VENDOR RESPONSIBILITY

WII’s Seattle source said that the new program was prompted by the Calif Alcoholic Beverage Control Commission’s 2011 ruling (California ABC issues its long-awaited advisory on Third Party Providers) that allows unlicensed, third-party vendors to promote wine sales just so long as they are not selling them directly themselves.

See 9/27 update on this in the lead of this article.

AMAZON SCHEDULE OF FEES FOR WINE MARKETPLACE AVAILABLE

Amazon’s fee schedule for their Wine Marketplace is available to Wine Executive News subscribers who can click here to view the fee schedule.

Subscribe to Wine Executive News now, and get the schedule plus original articles along with everything else on the premium site every day, including original documents like this one, spreadsheets,and source materials for just $13.99 per month.