Tuesday, October 2, 2012
Amazon Pours Itself Into a New Marketplace
Amazon has decided to begin selling wines online again. In 1999, it owned 45% of the internet site Wineshopper.com. That site closed in 2009 when it did not meet projected expectations. This time, it is starting out in much small way. This time it will sell directly to customers in the Napa Valley area of California. The wines may begin shipping in as little as a few weeks. This is perfect timing considering the upcoming holiday/gift-giving season.
Once that market successfully launched, Amazon could look into expanding into other wines from all over the world and customers from any area Amazon ships to. At a recent workshop in Napa that discussed Amazon’s plans, about 100 wineries were represented.
While nothing concrete has been announced by Amazon in regard to the terms of the new marketplace, there have been a few rumors. One set of terms that was mentioned (again NOT stated by Amazon) was $40 to join the wine marketplace and 15% of sales. (That $40 fee is probably on a monthly basis just like the Amazon FBA Pro Seller account.) If this is true, the cost is pretty much in line with most existing categories on Amazon. In this case, it is believed that the wineries will be handling the packaging and shipping side of the sales (using Amazon’s discounted shipping rates), while Amazon provides access to its large customer base and order processing.
Once this marketplace is online, it will be interesting to see if FBA sellers will be allowed to sell in that category as well. Or will Amazon leave it as a restricted marketplace. Either way, this could be a very successful partnership between Amazon and the wineries at the least. It could result in increased revenues, increased sales tax revenues, creation of more jobs, and much more. As with many of Amazon’s ventures, the possibilities appear to be endless.
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