A huge discount, good PR?

by Eve Resnick on July 20, 2009

in General

Want a Barolo, Penfolds’ “St. Henri” Shiraz or a Roederer Cristal 57% down their regular prices? Go to a few sites just opened to surf on the new (unfortunate) wave of overstock: winestilsoldout.com or thewineliquidator.com. On winestilsoldout, the sale rarely exceeds 8 hours – about a working day. That’s why many high-end or luxury wine brands consider it doesn’t hurt their image or pricing: “It’s such a short time window,”told Giacomo Turone, a sales executive for Palm Bay Imports to Los Angeles Times writer Patrick Comiskey, who has moved more than a dozen hard-to-sell Italian wines through the site. “It doesn’t undermine the price positioning of the brand in the long term. It’s not on their Web site for months — it’s on for eight hours.”

This is a comforting thought for the winemaker but is it true for the consumer? Consumers – even those who love expensive wines – are sensitive to price bargains. Is there not a risk to make them “addicted” to some high discount web sites? If consumers know that they get their favorite wines at half price or high-end wines at a huge discount, why would they buy it full price at their wine store? Why would they pay a high mark up in restaurants for the same bottle?

Discounting heavily a wine is not good for its image. Of course, times are hard for all wineries but thinking ahead is of importance. Let’s hope this sad situation won’t last too long…

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