Enter the Dragon

14 May, 2010

It’s notoriously difficult to make money in the wine trade, hence the saying that to make a small fortune, you have to start off with a big one. What convinced you and Peter Jones that there’s an opportunity??We already have access to an established online telecommunications business, Phones International, and have vast experience within the online market. We hope that this is a transferrable skill set into the world of wine. Consumer spending is increasing dramatically online and we believe we can capture a considerable piece of this emerging market through our website positioning.

The backing of the Peter Jones group of companies, my own business background [in finance], and the wine and retail expertise and experience of Angela Mount, gives us a strong competitive edge in developing this business opportunity.

How big do you estimate the online wine market could be? At the moment the online wine market is valued at around £600 million. We believe this will expand rapidly over the next five years.

What point of difference does Gondola offer consumers? While there are already several successful wine mail-order companies, I identified a gap in the market for the mainstream wine consumer, who enjoys the reassurance of established brand names, be that Dom Perignon or Lindemans. Gondola.co.uk is, to some degree, the online home of brands – consumers look for recognition in names they know and trust in other lifestyle sectors. We believe many seek the same reassurance within wine.

Can you describe the typical Gondola customer? It’s still very early days and we’ve been fortunate to attract a very wide range of customers to date, who have varying

evels of wine knowledge or involvement, but who are interested in premium and well-established wines. Like all consumers, they are always looking for great offers as well. As a result of early feedback, we are launching a new range of promotions this week, which will cover all aspects of the range, from core brands to fine wines and Champagne, providing value to our customers at every price level.

The site launched last December. How many regular shoppers do?you have now??At this stage, it is difficult to assess regular customers. However, what is most exciting is the reaction and sales achieved from the launch of our first online and affiliate activity, which exceeded our own expectations and targets by over 100%.

What marketing investment are you making to recruit new customers??We have committed £250,000 in terms of on and offline marketing investment. This figure is now likely to increase as the site and range develop, and sales continue to be ahead of our targets.

What plans do you have to develop the site??As with any site, this is an ongoing project. We are updating the site on a monthly basis, with increased range, new offers and promotions. We’re also developing some great competitions and hope to introduce a customer loyalty programme within the next few months. We are

ooking to develop the content and customer education side, by developing wine and food-matching pages, using videos of winemakers and vineyards and interactive tasting notes. We will also be developing a strategy to maximise social media.

What’s the rate of converting people browsing the site into actually placing an order??This obviously depends on the competitiveness of the offers, but since the launch, we are averaging around 5%, and are achieving higher conversion rates than this through some of the price comparison and affiliated sites.

How does that compare to the industry average??At this stage we think we are ahead of the industry average.

How have suppliers reacted to the launch and what benefits are you offering them to trade with Gondola over traditional retail channels??Wine suppliers have reacted very positively to the launch. We have had tremendous support from our early trading partners, Foster’s, Concha y Toro and Pernod Ricard. We are now in discussions with a number of other potential suppliers, as we look to develop the range in certain categories.

Gondola offers a real opportunity for brand owners at all levels to find an alternative route to market for a wide range of their SKUs, as traditional retail channels reduce the size of their ranges.

When Gondola launched, you set a target of attracting 1 million customers. How are you planning to achieve that??Initially the launch of Gondola was fairly low key. We now have the infrastructure and the team in place to drive this forward, and are effectively launching a far higher profile site and programme of activity from mid May to achieve our target.

Finally, what wine do you drink to celebrate a new business deal??Château d’Armailhac.




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