Austrade media release

18 March 2009

With the UK market putting the squeeze on Aussie wine producers a world-first approach has been taken to get our boutique, smaller scale producers into the British limelight.

Austrade’s Senior Trade Commissioner for the UK, Kylie Hargreaves, said a crowd-sourced, live-Twittered wine auction, with A$100,000 budget was hosted by UK internet ‘farmers market’ site, Nakedwines.com in partnership with Austrade and the SA Government.

“On-line sales are one of a handful of areas in the UK economy that are actually showing strong healthy growth so we felt this was a great approach to getting our smaller producers into the marketplace,” said Ms Hargreaves.

"The event, covered by UK national press, had a great hum about it, lots of expert wine tasters mixing comfortably with the average wine drinker. It's a great model helping to bring new wines direct to interested UK consumers while enabling Australian wineries to duck the enormous purchasing power that the UK supermarkets use to force enormous discounts onto our wines.

Naked Wines who recruits on average 1000 customers a week, was started by Rowan Gormley, the former owner/ founder and MD of Virgin Wines - one of the UK largest online wine retailers.

“When we wanted to buy $100k of the best wines nobody had ever heard of, Austrade made it all happen for us. They found the wines, handled communications with the winemakers, even poured for us at the tasting! We could not have done it without them”

“This is the future for wine. Customers get to pick the wines they like, at a price they are prepared to pay and the winemakers get to sell their wines at a price they consider fair,” Mr Gormley said.

“The process is fast (we did in an hour what normally takes months) and more importantly, it is free. Winemakers can focus on making great wines, rather than wasting their time, money and a huge amount of CO2 selling them. So customers get boutique wines, chosen by themselves, for the same price they would pay for mass-produced supermarket plonk.

Customer Alex Vidovic enthused that it was a fantastic and eye-opening event to experience.

“Part flash mob, part social networking and part online auction all rolled into one. It seems crazy that this hasn't been done before - it's the next best thing to visiting three dozen wineries in one night and picking products straight from the cellar."

Winemaker Dave Johnson of Greedy Sheep Winery in Western Australia was one of the fifteen winning winemakers said being chosen felt like winning the lottery.

“I got woken up by a call at 3.30am, I was online by 4am and by 5am I had an order for $12,000. Now that's the way to do business!”

A recent report from Euromonitor shows that per capita in the UK people spend £270 via internet retailing per annum. While the figure for Australia is AUD 80. Figures issued by suggest Britain imports 1.6 billion bottles of wine per year. Britons spent £ 3.3bn on wine in 2007.

There were 15 winning wines from the 100 tasted. The winning winemakers who won a slice of the $100,000 order were:

Tasting and auction details- how did it work?

The objective of the process was to find the hidden gems – the quality wines that the wine trade has missed – and the price which works for wine drinker and winemaker.

• 50 wines from over 20 independent winemakers, which are not generally for sale in the UK.
• Naked Wines invited its 50 most active customers (ie those who rate wines and winemakers online) to taste the wines
• Customers able to chat to the winemakers by twitter, but not told the price of the wines.
• 3 rounds of tasting; Round 1 – to eliminate any wines that are faulty; Round 2- every wine e scored for quality on a simple 5* rating to find the best wines in the tasting regardless of price; Round 3 – the top 5 or wines will be tasted again and this time customers will be asked to specify the price they would be prepared to pay for the wine
• The best 5 wines and the price the consumer is prepared to payis determined so  the winemakers were invited to review the price they wanted to charge for their wine, up or down.
• Armed with this information A$100,000 was allocated between the winning wines, with the biggest slice going to the wines with the biggest gap between the price customers are prepared to pay and the price the winemaker is prepared to sell for
• The auction - for one hour the 5 winemakers were able to increase or decrease the slice of the A$100,000 they get, by changing the price they are asking for their wine
• When the auction closed the price and volumes became binding on both parties. 
• Naked Wines will issue a purchase order to formalise this Winemakers deliver agreed quantities to Naked Wines' agent. Payment will be made within 14 days of bill of lading
• 14th May, 2009- The wines arrive in the UK and are available for sale at Naked Wines, at the price the customers agreed to pay.

ENDS

Media contact

Samantha Mattila
Senior Media Adviser
Tel: +61 2 9390 2388
Mob: +61 434 567 673

For further news and information from the Australian Trade Commission (Austrade) visit www.austrade.gov.au//mediacentre.

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