Direct-to-consumer wine company, Naked Wines Australia has reported a sales increase of 42% to reach $84.2 million for FY21, coupled with record high customer retention and repeat purchasing.
The business has been driven by major trends including the online shopping boom and strong stance to support local, according to Naked Wines Australia managing director, Alicia Kennedy.
“The pandemic has expedited and democratised people’s comfort with buying online with greater flexibility on where people work and their ability to take deliveries,” she told Retailbiz in a recent interview.
“We have also observed a real understanding on the impact of every dollar spent with a strong desire to directly support local businesses and producers who were by far the most exposed during this time. Further, consumers are leaning into independent makers and our business sells independent Australian wine, which has benefitted from strong consumer support.”
Since inception, it has been Naked’s mission to disrupt the wine industry for the benefit of its customers, winemakers and people, and the pandemic has served to underscore the value of its business model in connecting winemakers and consumers.
“It has been truly inspiring and motivating to have such an impact on independent winemakers who were more reliant on tourism and hospitality, and who have been hit hard by the recent import tariff action,” Kennedy said.
“We were able to use our position to help beyond connection to customers. Our $5 million COVID Relief Fund offered much needed support to 36 winemakers, many of whom saw their sales to restaurants and tasting rooms disappear overnight.”
When asked about the biggest lesson learnt through the pandemic, Kennedy believes COVID-19 has accentuated the wine industry’s challenges and validates Naked’s business model.
“Our people have done extraordinary work in supporting independent wine producers and building our platform, but what we’ve seen is the power and possibilities that you have with a community of over 130,000 Angels (subscribing customers) backing not just Naked but our independent winemakers.”
As for her advice to fellow ecommerce businesses: question and evaluate the way business has been done in the past and do it better.
“We’ve got a simple mission and model here at Naked – ‘Better Wine at the Fairest Prices’ by backing the best Australian and New Zealand winemakers. I think models like these could become common across many categories and ecommerce players have none of the baggage of big retail so they can move much quicker,” Kennedy said.