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Written by Nikitas Magel   

Event Display Bottles

An Interview with the CEO of Wine 2.0

Wine.  Technology.  They're industries that aren't normally associated with one another in casual conversation.  After all, they do tend to attract people with respectively different mindsets and values: one with its artisanal passion for craftsmanship, the other with its methodical drive for development.  But with their common tendency towards creativity, the two unlikeliest of bedfellows have come together to engender some of the most compelling changes in the areas of wine sales, marketing, and media.  Concurrently, a new generation of consumers is utilizing hardware tools and web-driven services in innovative ways to learn and communicate about their common passion for wine.  Arising from these phenomena was the coining of the term 'wine 2.0' to refer to companies and organizations oriented around the intersection of the two.  One such company, boldly adopting the term as its own name, is Wine 2.0.  It's a venture that has taken the idea of combining the two industries one step further by coordinating events that bring them together in a social context with the goal of "blending the line between wine and technology."  The result is a synergy from which the wine trade and its consumers are increasingly benefitting.  Speaking on behalf of his partners Chairman J. Smoke Wallin and Director Jeffrey Playter, I met with Wine 2.0's CEO Cornelius Geary to discuss their collective vision for this venture as well as his own thoughts on the future of the wine industry in the context of technology.

NM:  What is Wine 2.0?

CG:  The genesis of Wine 2.0 occurred when my partner and I started RadCru and realized that there were other smaller companies like RadCru that needed a vehicle to promote themselves.  We saw Wine 2.0 as a platform to communicate and connect with each other as well as our competing companies, many with whom we've become friends.  It was named as a way to delineate between the concept of [what we thought of as] wine 1.0 — the 'wine.coms' of the world who've remained in the traditional domain of online wine sales and marketing — and what we felt were the new opportunities and new business models that came about after the dot com crash.  Essentially, we're an event marketing group working with wine brands and other companies who share this newer vision, to help get them in front of consumers and the wine trade, and to get people tasting and talking about wine in the context of fun and innovative events.  At the same time, we're tying it all together online through social media tools like Facebook, LinkedIn, and Wine 2.0's own social website in order to facilitate a wide network where everyone is represented, can communicate, and gets together for face-to-face meetings.

NM:  How is the Wine 2.0 model different from others in the domain of event-planning?  What is it that makes you guys unique?

CG:  I think the difference lies in the type of person who comes to our events: a younger, hipper, very highly educated consumer who's a lover of both wine and technology.  Also, these events are not your stiff and traditional wine-tastings; they're experiential, entertainment-oriented events that people come to for the wine and the camaraderie that goes along with communicating about wine.

winetwo_shakeNM:  You mentioned that essentially what you're doing is bringing wine and technology together.  Do you believe that this "blending" of the two is the general direction that the wine industry is going, or do you think that this is something more in the domain of a specific subset of the wine industry?

CG:  I think that wine producers — the smart ones — understand that they can go online and build their brands, make more money marketing through those channels, and gain more awareness among consumers using online marketing tools.  There could be fifty different types of companies that are doing different things online. But that direct connection with the consumer and the potential sale it holds, I believe, is the number one priority for wine brands in the U.S.  The smarter wineries are focused on getting connected directly with their consumers.

NM:  Is Wine 2.0 primarily a business-to-business entity, then, or do you think it holds equal interest to consumers?

CG:  I think it's both.  We have a very strong B2B side and for our events we're incorporating a trade component, so half of an event will be confused on the trade-tasting aspect — getting people to taste the wines — and then we have a consumer side where we're getting people who are also interested looking at these new technologies and these new wine brands.

NM:  To what extent do you feel that you're doing these things in a way that will implement change on the business side as well as the consumer side?

CG:  It's all in facilitating and providing the opportunity.  There are the distributor-based companies that are going to be use traditional means of wine distribution who don't necessarily need to the direct-to-consumer model, though they can participate in it.  But then there are the wineries for whom acquiring those customers directly is extremely important, especially (as is the case with most) if they don't have full distribution throughout the U.S.  For them, getting face time with some of those customers is of huge interest, as is having as many of those customers as possible opt-in for their email lists while at an event.  We provide a great deal of opportunity for those brands to connect with those consumers.  Tying that in with the traditional trade route, we have sommeliers coming in and tasting wines at an event who might end up bringing some of those wines into their restaurants.

NM:  So, if we were to boil it down to one central concept, or even core value, it sounds like what Wine 2.0 is all about is connectivity: you're connecting different domains of the wine industry and you're also connecting consumers with those entities.  Plus, it also seems that you're doing it in a way that's fun and interesting.

CG:  I think so.  The companies that are participating in our events are on the leading edge.  They're innovative brands on the technology side, cool brands on the wine side, and they all get it; they see this as a great opportunity to connect easily with both trade and consumers.  And then tying it in with an online presence, they can find a whole other group of people who couldn't otherwise come to an event.  It creates a big circle of opportunity for everybody to participate.

NM:  Tell me a bit about the events themselves.

CG:  The event management side is essentially setting up an event and managing it, dealing with both the consumer attendees and our winery and other trade partners.  We do a couple of things very differently [than a typical tasting event].  First off, we don't like our wineries tucked behind a long table — instead, we do cocktail-style tables, so they're actually among the crowd of people and in the party, rather than behind behind a table looking out at a party.  I think it really changes the vibe of the event: it pulls them in, they communicate, and they become part of the party and not just someone stuck pouring wine at an event.  The wineries that haven't been to our prior events are not used to that; it's different for them.  But I think at the end of the night, they really appreciate being much more in tune with the consumer.  Now, what we do on the display side for the wine 2.0 companies is provide them with a traditional table for them to actually demonstrate their products.  At past events, for example, we had WineSnob demoing their iPhone app, or Ning demoing their social networking tool.  We'll have around 20 or 30 companies demoing their products at these events.

winetwo_groupNM:  Wow!  So, it sounds like a Wine 2.0 event is actually a hybrid between a tasting event and a trade show — but in a very heavily social atmosphere.

CG:  Exactly.  That's a good way to put it, especially for the "Wine 2.0 Expo" events, which are the tasting and trade opportunities where we have the wine 2.0 companies and consumers all in one space.  We actually have three other types of Wine 2.0 events.  The "Wine 2.0 Experience" events we actually embed into other established events and find a whole new demographic of people that are part of another group, and we help our winery partners get in front of them.  At those events we're less of a technology player and more of a marketing entity where we're essentially bringing wine to the party.  Then we have "Wine 2.0 At (your business school)" events, where we partner with leading business schools to provide an opportunity for alumni and current students to come together in the context of wine.  They're a highly educated, elite customer that wineries want to connect with, so we give them the opportunity to get in front of them and collect customer data.  And finally, we have "Wine 2.0 Reserve" events, where we provide an invitation-only type of opportunity for our brands.

NM:  And what's been the reception on the part of consumer attendees in general to your events?  Do you get a sense that there's a clear understanding and appreciation on their part for what you're trying to achieve with them?

CG:  I think you have several levels of consumer involvement, really.  There's the traditional, but still cutting-edge, wine connoisseur who has to hunt to find out about our events — we're not part of the traditional places where those people go.  Then there is a lot of people who are getting into wine for the first time, a younger demographic, 25 to 35 [years old].  We have a lot of technology employees who are working at Google or Microsoft or Sun Microsystems, the big companies especially here in the Bay Area, or the innovative start-up companies like Technorati or Digg, where they're coming out to socialize — one of them might have have the next opportunity for the Wine 2.0 space.

NM:  I think you'll agree that the new generation of consumers and producers view the sales and marketing of wine with a perspective very different from the previous generation.  For one, they've fully embraced the use of online tools & technologies, many of which are being used in newer forms of wine media.   Given this, I get a strong sense that there's some friction between traditional wine media (primarily newspapers and magazines) and new wine media (blogs and social media, as well as print media that embrace those tools).  What is your take on all this?

CG:  I think that the wine industry on multiple levels — production, distribution, consumption — is twenty years behind everyone else.  They're all amazing people; they do what they do very well.  But they're not trying to change the status quo and shake things up.  Conversely, there are 70 odd million Millennials, just a bit smaller in size than the Baby Boomers, who are hitting the market now and they have an affinity for wine and an understanding of these technologies.  And we're there to help them to get into the marketplace, to understand what the opportunities are for them as consumers, and to provide them with ways to stay informed about wine — with wine tasting events, information about the online components that they need to socialize around wine, and exposure to the cutting edge brands that are going to be the leaders twenty years from now.

NM:  Part of what you're doing, then, is facilitating open dialogue in a language in which the Millennials are fully fluent.  On the other hand, as you mentioned, a lot of people in the trade, primarily on the production side, speak that language very haltingly, if at all.  They're far more likely to be traditional in their thinking and usage of media platforms and marketing tools.  How do you get these people on the trade side to begin embracing wine 2.0 methodologies?  How do you propose they starting speaking the language?

CG:  I think that they need to start by deeply evaluating what it is they want to do.  Do they want to maintain their business in the way they've run it for the last twenty years?  Do they want to see a competitor of comparable quality, one who understands the technologies and can adapt to newer marketing methods, come onto the scene and begin to take that business away from them?  I think Wine 2.0 is a convenient discussion point for so many things that are going on in the wine marketplace: things like using Twitter and Facebook for customer aggregation, or using e-commerce companies for building a website and managing direct-to-consumer and direct-to-trade sales.  The technology is here and it's improving; the consumers are younger and smarter and they're using that technology more and more.  It's in the trade's better interests to get on board with that, too.

But to be honest, there are really two levels of interest in all of this on the production side.  There are high end and high profile producers who just don't care about any of this; they're as successful as they could ever have hoped and they don't need anything else right now — right now.  Then there's another level just below these ultra premium brands who still need help selling their wine.  They might not be technically savvy, but they know that they need to evaluate the [market]space and find opportunities.  Those are the ones that I'm interested in helping, the ones who are showing the interest.  We get dozens and dozens of emails every week from winemakers looking for suggestions on what they could do, partners we could provide them with, or help in understanding where they need to go in this space.

NM:  Let's say a producer reaches out to you for guidance in make an impression on Millennials, but simply doesn't relate to the heavy use of online technologies or understand the details and lingo that go along with them.  What do you tell them?

CG:  I tell them: Be cautious and dip your toe in the water.  Facebook is a great place to start: set up a brand profile, a group for your brand, and organically just begin promoting it.  It's not going to change anyone's life overnight.  But it will provide you with brand recognition as well as opportunities to see what the technologies are like.  And it's free; it doesn't cost anything.  Through that, you'll see what's out there — the wine 2.0 companies, the wine bloggers, the companies that are on the move within the space.  You'll find ones that you can identify with and whose model you understand, and they can help you.  Take Facebook right now, with its millions of users: what would it take to get a comparable audience in print media or television or radio — for free?!  And now multiply that captive audience by however many various online platforms there are with different user bases.  Using all the technologies to broadcast your brand to the masses online is the distributed approach that the smart guys are going to take.  If I were a wine producer, honestly, I would hire a 21-year-old to be my online marketing manager.  I would have them saturate my brand on as many viable platforms as possible, incorporating video and services like Twitter, aggregating as many friends, family, customers, and fans as possible into a movable, massive, online audience for the brand.

NM:  Would you say this all more or less hinges on changes in interstate direct-to-consumer laws?  Do you think any of it — the new tools and technologies, the news ways of reaching consumers — would still be as important were it not for those changes?

CG:  I don't think it would, not at all.  Of course, from a brand-building perspective, it would still be effective — Yellowtail could still add another 10,000 cases to their sales with a Facebook app.  Fine.  Great.  Woo-hoo.  But what we're talking about here are small producers who make under 1,000 cases of really phenomenal wine, but who can't get on the radar in 40 states!  Why shouldn't they have the opportunity to sell their wine?  Companies in wine 2.0 exist because of these barriers to sale.  And thankfully, these barriers are coming down, for the most part.  Wine is really an agricultural product that in most cultures is celebrated with the family; people grow up having wine with their families.  In the U.S., we have a great opportunity now to have that type of lifestyle and then to move it ahead.  The changes are going to make the pie bigger for the whole wine industry and that's going to be a good thing for everybody.  It'll take time, though.

NM:  How can Wine 2.0 help consumers who live in states that are still experiencing the remnants of a prohibitive retail model and therefore don't have a lot of choice in buying wine?

CG:  I think we'll help by promoting companies that are facilitating and vitalizing the direct-to-consumer model.  But overall, let me put it this way: it's only the 3rd inning of a 9-inning game.  A lot of the barriers are coming down (and some new barriers are coming up), but most states see the opportunity to 1) collect more tax and 2) provide their constituents with more consumer choice.  With that comes creativity and new opportunities for wine 2.0 companies to find the magic bullet that changes it for everyone.  There's still at least another ten years before we really start to see significant change for the wineries.  Our focus with Wine 2.0 is to provide a platform for those companies to be discovered, for those cutting edge wineries to promote themselves and identify with the consumer, and for the consumer to come out and taste those wines and discover those companies.

NM:  Your baseball analogy is quite apropos: it is too early to tell.  There's simply no clear picture on how the cards are going to fall.  After all, so much of what we've discussed has developed only in the last five, perhaps seven years.  And the interesting thing is that we've got technology on the one hand, wherein a great deal of change occurs with blazing speed, collaborating with the wine industry on the other, where relatively very little change happens over a long period of time.

CG:  There's a little Don Quixote in all of us on the Wine 2.0 side.  These are people who are really creative and love wine, who realize that the wine industry is a very large and slow-moving beast, and who think that if we could make that animal a little bit leaner, smarter, and quicker, then it would improve things.  But it is happening; I have no complaints.  On so many levels, we've moving forward and innovation is happening.

NM:  One last question, oh Man of La Mancha: What's your desert island wine? — single varietal and/or region.

CG:  New Zealand Pinot Noir.  And maybe New Zealand Sauvignon Blanc, too.

Our conversation on Wine 2.0 and its position on the broader landscape was yet another reminder that a critical mass of talent and vision is gathering in the emerging domain that intersects wine with technology.  As a result, increasingly positive, inspired, and creative change is coming about in how professionals in the wine industry think of marketing and selling their products, inducing them to question old assumptions and consider new possibilities.  Wine 2.0 is one company doing its part to facilitate these efforts in moving the industry forward, with its emphasis on bringing people together — all in the name of wine.  To learn more about the partnership opportunities and upcoming events dedicated to "blending the line between wine and technology," visit Wine 2.0 online.  To connect with other people sharing this interest, join the Wine 2.0 social network.  end