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Written by Nikitas Magel   

A Top Secret Interview with The Wine Spies

wine_darkness_sharpThey call themselves The Wine Spies.  And they're a geographically diffuse collective of top secret operatives whose sole mission is to expose and purvey to otherwise unwitting civilians "undercover deals on exceptional wines" — at the rate of only one wine per 24-hour period.  A unique strategy, to be sure, and one that has resulted in a burgeoning customer base that seems to be growing exponentially.  On learning of the organization and its modus operandi, I became deeply intrigued and set out on my own clandestine operation to gather more intelligence.  Under the condition of anonymity, and on a secure, encrypted line of communication, I spoke with the organization's lead operative and tactical mastermind, Agent Red.

NM: Without compromising any sensitive information, can you tell me who are The Wine Spies and elaborate a bit on your collective mission?

AR: What we do is to feature one exceptional wine per day, online, in usually a quantity-limited, 24-hour sale.  The wines that we choose are always the best that we can find and — with so much supply, with so many wines available to us — we're getting very picky.  Which is great.  That's good news for our customers, and hopefully also for the wineries we work with, because they can be assured that if we're showing them on The Wine Spies then we love their wine well enough to put it up.  Plus, a lot of those wineries are using our reviews in their own marketing materials.

NM: So let me see if I'm understanding this correctly: you sell only one single wine that customers may purchase at a discounted rate during a 24-hour period (expiring at midnight), after which it's no longer available, but is then replaced by a new wine selling over the next 24-hour period.

AR: That's correct.

NM: Wow!  That is definitely a very interesting and unique business model, because it sounds like what you're doing is getting (and giving) the best of both worlds.  On the one hand, you focus attention on a single wine and offer it at a discounted price, keeping the shopping process very simple for the potential customer.  But at the same time, by featuring that wine for only 24 hours, you garner a captive audience, a loyal following: once a customer has learned of your business and how you operate, it must be tempting to check your website regularly, if not frequently, to check on what's being offered on a given day to see if might be of interest.  It never gets stale; it's always fresh and interesting.

AR: That's right.  We have thousands and thousands of Daily Dispatch subscribers — we have an email that goes out every night, the night before the sale, announcing tomorrow's sale.  It's really interesting to see, using today's wine as an example, our first sale of the day actually came just minutes after midnight from a customer who was so eager to buy the wine, and afraid that they might miss out, that they jumped in that early.

NM: Now on the flip-side, doesn't this create an undue burden on you?  It seems you'd need to be two or three steps ahead of the game by having a number of targeted wines — and the logistics with their wineries' reps — all lined up well ahead of time… a 'buffer,' if you will.

AR: Yes.  In general, we schedule wines about a month in advance.  That's really our goal right now.  It used to be that we were a week in advance, then that quickly spread to two and then four weeks, as more and more wineries began beating a path to our door.  But, yeah, it's a big challenge.  Every day, we've got to execute very efficiently on each one of our tasks that's absolutely critical.  One of the great things about my partnership with Agent White is that he keeps me in check, he keeps me very focused on what he calls 'the critical path' — we have a very specific and set path through every day.  There are certain things which we cannot ignore, things that must get done no matter what.  It's a lot of work, it's a lot of pressure at times.  But the farther ahead we can get, the easier it becomes, and that frees us up to focus on other things like marketing.

NM: So, apart from the obvious fact that this whole approach separates you from the majority of other online wine retailers, how else are your sales and service different? What do you feel you offer the consumer that s/he may not find elsewhere?

AR: Consumers on the internet are a unique bunch.  They are savvy information shoppers, and they're sometimes value shoppers.  I think a lot of people shopping on the internet, in general, have the perception that things they buy on the internet will be less expensive than those things that they find in a store.  So, while we don't want to be viewed as a discount house, our discount is really there as a way to lower the barrier for a consumer to try a new wine, to lower the risk of trying that wine by putting a small discount on it.  Typically, the wines that we sell are anywhere from 20%-30% off, sometimes more; it depends on the wine and the winery.  But we want to introduce new wines to the consumer, wines they've never tried before, because it's really our belief that if they do try some of these wines, they will fall in love with them.  And in falling in love, they'll want to buy more.  And that's actually a benefit to our wineries, because once that consumer has tasted that wine and wants more of it, they can't buy it again through The Wine Spies, but have to go back to that winery's website and make those follow-on purchases through the winery itself.  So the wineries really benefit, as well.  Plus, we've had feedback that those follow-on orders have resulted in literally thousands of dollars in sales for them.

NM: This entire business model, similar to the practice of espionage after which your company is themed, sounds frankly quite risky.  Why did you choose to go with the approach of offering a 24-hour deal on only a single wine per day?

AR: Only because I thought it would be a successful model, and also a novel one.  I think novel is good.  Of course, novelty is not: we didn't want to be perceived as cartoonish; we were careful with that in our style, the look that we'd chosen for the site.  And we certainly use a lot of humor in our wine reviews. Our 'Mission Reports,' for example, are sometimes fictionalized.  But the core of them — the core of the reviews, the review part of the reviews specifically discussing the wine —that's 100% real.  When we review a wine, we do so on five criteria: look, smell, feel, taste, and finish.  And we use those words, rather than words like 'nose' or 'palate' that are sometimes confusing, especially to new wine drinkers.  We wanted to keep the language a lot more approachable and a lot more accessible, by using very plain words.  We wanted to keep the reviews fun and lighthearted and yet be completely factual.  It was our intention to educate and introduce [wine jargon] eventually, but from the beginning we wanted to keep things really accessible to wine drinkers of all experience levels.

We did a survey of our customers after about a year in business, and we were very gratified with the results.  The chief take-aways from our survey were that we're doing a great job in finding consistently wonderful, high-quality wines; we're doing a great job in thoroughly describing those wines; and then finally delivering wines that match those descriptions when people get them home and drink them — which is a really important thing.  A review of anything — be it a movie, a play, a book, or a gadget — can be very subjective.  And when you get into wine, things can get super-subjective, so we have this goal of keeping things very honest and plain, without dumbing things down to those higher-end wine consumers who are used to using more high-fallootin' language.  So we have to try to strike a balance.  And I think, at least according to our customers, we've really achieved that goal.

NM: Can you divulge some of the mystery behind The Wine Spies — specifically, the intrigue of how it all began, and the rationale behind its name?  And how does that all relate to how you personally became involved in the wine business?

AR: I was a beer drinker most of my adult life.  That was about the extent of my imbibing pleasures.  I was an infrequent wine drinker and when I did drink wine, it was [just simply] red or white, and I didn't really know much more than that.  But when I lived in Sonoma County, I had occasion to drive by a lot of wineries, and there was one winery in particular that I would drive by, because it was on the way to the state park that we would frequent.  It had an unusual name, and it was small and looked non-threatening — as compared to some of those gigantic castle-looking ones.  So, I decided to pop in.  And there in this little barn-like tasting room, I tasted through some really incredible wines, and had kind of an epiphany about wine: I realized that there was so much more to wine than just 'red and white.'  Essentially, I had my wine awakening there.


At the time, I was running a company that sold toys and games online.  [As a bit of background,] I've been in the commercial internet since the heyday, the very beginning of the commercial internet.  I had a web-development and strategy firm in the late '90s and early 2000, then got out and sold my company before the bubble burst.  But since then, I've worked on various projects, the most recent of which was the online toy and game site.  When I sold that, it was immediately apparent what was next; I knew I would getting into the wine business.
And I knew also that I would be doing this with my friend Agent White, who was a long time friend and a former contractor that I had hired when I ran my web development company.  He and I became fast friends way back then, in the late '90s, remained friends, and always knew that one day we would partner up on a business.  So I brought this idea to him — the idea being to sell one wine per day — and at that point we didn't really have a notion of brand or angle or spin.  We very quickly came up with a number of names.  And when we thought, "Okay, what is it that we're actually doing?… We're going to get out there, into the wine world, and we're going to uncover these gems of wines that are not widely available, that are not on the supermarket shelves."  That was another thing that I'd realized: you can go into Safeway or any other big grocery store where there's a ton of wine; but for every bottle that's sitting there, there are dozens and dozens more that you'll never find in a Safeway that are probably infinitely more interesting.  So, we threw out a bunch of names, and had an "ah ha!" moment when we threw out "The Wine Spies" name, and from there the brand name all came together.


We also looked at our own interest in wines.  Agent White had already been a pretty experienced wine drinker.  We're both under 40 [years of age], just barely; I'm about to turn 40.  Looking at those people who are in our age category, and younger, showed us that there are a lot of younger wine drinkers there.  So, in designing the brand, we thought we'd design for the so-called Millennial generation and slightly above.  But what we found was that we were actually serving wine drinkers of every age range, of every experience level, and that our brand, coincidentally and luckily for us, had a universal appeal.  It wasn't trying to be so tragically hip and cool that it would only appeal to a Millennial generation.  I think people that consider themselves aficionados or slightly snobby wine drinkers quickly realized that the substance of what we were offering is really what mattered.  And the spy thing is a lot of fun.  We have a lot of customers who give themselves agent names, and interact with us daily, who really are quite into the theme.  So it's a lot of fun.  When I'm talking to people, I am only Agent Red; I don't identify myself by my real name.  One of the cool things about that persona is that it's immediately disarming, which is great.  I tell them that I'm "Agent Red calling from The Wine Spies…" and then it's laughter, which is a really cool thing.  It's a great way to open a conversation.  Sometimes people are a little more serious, but in general, it's received in the spirit of fun.

NM: You've mentioned a bit about Agent White.  Of course, without revealing any top secret identities, what more can you reveal about him, your other partner operatives, and where they all fit into the larger organization?

AR: The Wine Spies are comprised of myself, my partner Agent White who mans the L.A. office, plus another full-time agent up in Sonoma County, Agent Grenache, who handles all our logistics and fulfillment.  And then we have two other part-time agents — Agent Blush and Agent Sparkle — both of whom do wine review and the occasional wine mission.  Along with Agent Grenache, Agent White and myself are the primary operatives.  And I'll just explain what our main roles are.  Mine is of the primary intelligence officer for finding new wines; I'm the one out there calling on wineries.  It used to be a much more difficult process to locate wines [to sell], but more and more wineries are beating our door down, now that they've come to know us.  We've been selling wine for almost sixteen months now, and we've established a great reputation as a serious sales channel.  I'm also doing most of the wine reviews; I would say about 75% of the reviews are written by me.  Occasionally, Agent White will also review wine, primarily the ones that we feature on our International Selection Sunday, where (every Sunday) we present a wine from somewhere other than the U.S. — often France and Italy, sometimes New Zealand, Australia, South Africa, etc.  Other than that, his primary function is that of the guy with the green visor and the sleeves rolled up; he's the guy who's doing all of our compliance-reporting, the accounting, taxes, and reconciliation.  Now, another thing I'm doing is the photography — I'm running around photographing the wines, which is fun.  I've never been a photographer before, but we've actually had two wineries offer to hire us to do all of their bottle shots.  And most of the bottle shots you see were done by me.

Agent Grenache in Sonoma County is the guy responsible for picking up the wine after the sale is over — picking it up from the wineries or the wineries' warehouses, dragging it back to our facility there, and doing all of the consumer fulfillment on those wines.  Come January, I will be back up in Sonoma County.  (We relocated from Sonoma to Monterey for a short period because Agent Sparkle was pursuing her graduate studies here, at the Monterey Institute of International Studies — where, coincidentally, a lot of actual recruiting for intelligence agencies is done.  Occasionally, they'll have a CIA or FBA or NSA Day.  And quite often she'll see guys in suits and sunglasses — the typical hollywood image of the government agent — vetting potential recruits by interviewing fellow students right there on campus.  She's overheard a couple of interesting conversations.  And whether or not she's been recruited herself, I'm not at liberty to discuss.)  Finally, Agent Blush, on the rare occasion that we feature a rosé wine, will make an appearance and  do the review of that wine.

NM: Life imitates art, I guess… or business, in this case!  And speaking of the business, I think it's interesting that you focus almost exclusively on the sale of California wines.   Given how vastly under-represented and under-marketed California wines are outside of the United States, can you tell me if and how you've taken into consideration (either now or in the future) the selling of California wines to international customers.

AR: Yes, that's a great point, and that's something we're been very mindful of.  And not only are California wines under-represented outside of the United States, but outside the state of California as well.  If we look at the makeup of our customers, we're shipping great quantities of wine to states like Florida, Ohio, and Illinois — they just can't get a lot of California wines out there.  Now, in looking at the international scene, we see a lot of opportunities, to be sure.  Is there an opportunity for an entity like The Wine Spies in different countries?  Yeah, maybe; we've been approached by a couple of interesting foreign groups, and have engaged in early discussions about firing up The Wine Spies in those different countries.  It's going to take a little more research.  But I think, in general, California wines are severely under-represented.  Agent White just was in Japan and Korea, and was shocked at the California wines that were there — those wines are of super-low quality, and at super-high prices!

NM: From your perspective as a savvy undercover agent in the intriguing business of wine, what are your thoughts on the increasing integration of internet technology into the wine industry in general?  And how does that apply to The Wine Spies, specifically?

AR: Well, there's this whole notion of 'wine 2.0,' which, in my opinion, began when 'web 2.0' started to become a buzzword.  People started declaring companies like mine and others as belonging to a category called 'wine 2.0.'  Whether that's true or not, I don't know.  I think there are some companies that are certainly more innovative and creative in their uses of technology than traditional wine retailers or even many online wine retailers, and I applaud them.  I think I'm in really great company.  There are retailers out there that some might call my competitors and other companies that are doing things in social media.  I think it's virgin territory, largely.  I think there's still a lot of experimenting to be done, and I think it's really great that there are a lot of companies that are willing to experiment.  Now, again, back to us… whether we are a 'wine 2.0' company or not, I'm not quite sure.  Personally, I don't like such labels, and prefer not to be pigeon-holed with what could be a limiting term.  We don't do as much in direct social media on our website as we could, but we've also wanted to keep our model very simple.  And we've been very successful with that model.

NM: Any plans for future changes to The Wine Spies that you're at liberty to divulge?

AR: Yes, you will see change.  And that change will come incrementally.  We don't want bombard, we don't want to do a giant new release.  We will continue to tweak and adjust, and really our focus will remain on the quality of our wines, the quality of our reviews, and — internally, from an operational standpoint — the quality of our execution.  Now, I'll get back to where we're going by explaining first where we've been.  We self-funded this company, and in less than nine months, have paid ourselves back, paid back the loans.  And then a month after that, we became profitable.  So, to achieve those two milestones — becoming debt-free and then profitable within a year in business, where most businesses take a couple of years to achieve — those were huge indicators that we have a winning formula here.  And that just drove home the need to really continue this very critical path that we follow every single day, and to stay on that path through every part of execution, to make sure that we're doing everything right, and that we're taking good care of our customers and good care of our wineries.  And then the milestone that came after that is that we started putting money in the bank.  Which is another incredible milestone for a company, to actually have a cash reserve.  So, from the beginning, Agent White and myself had a commitment to each other, to our mutual success, and to really focus on profitability… not doing things the 'old web' way.  We'd decided we were not going to go for outside money — at least not for a long while, not until we really established the company.  We did everything organically.  And that led to profitability, pay-off of the debt, and actually being able to pay ourselves a salary while putting money away in the bank.  Those are huge things that will contribute to the value of our company, should we ever seek outside investment.

Now, to answer your question in a way that's more meaningful and more practical, as to where we're going in the future, I can only say that we have some interesting plans that will be rolled out incrementally, and they're very exciting.  The rest, at this point, is top-secret.

NM: Fantastic!  Now, hopefully, your answer to this next one won't be quite as secret: What are your thoughts about the future of the wine industry in general?  Where do you see the most significant changes being made in the industry today?

AR: A lot of people have postulated that Amazon will be a real driver for change in the wine industry, specifically with regard to all of the regulatory issues that are really bogging down the industry.  Whether that's true or not, I can only hope that they are.  I do think that, in general, there is definitely more of a movement towards a consumer-direct model, where wineries are selling directly [to customers].  Now, I don't know what to call an intermediary consumer-direct model — maybe that's what we are — where the winery is reaching out to new consumers through us.  Again, we're very unique from any wine retailer in that we're willing to give away that second and third sale; all follow-on sales, right now, belong to the winery.  It's our purpose to do the initial match-making: introducing our customers to new wines, getting them to fall in love with those wines, and then when they want more, to buy it from the wineries.  And that's a real turn-on to the wineries; it's a benefit for them in working with The Wine Spies.  Yes, we're leaving money on the table; yes, we already have relationships with the wineries and could easily make those follow-on sales.  But we wanted to do something different.  And not just on the consumer side, but on the winery side — in support of their consumer-direct efforts, in support of their growing their efforts that way.  Because that's the way that side of the industry is going, and should go.

NM: And on the subject of consumers, what advice would you have for those who are interested in wine, but might be a little bit confused as to how to learn about wine in general and discover what they like in particular?

AR: I think what you must do as a consumer, is to find a trusted source of wine recommendations.  Find that one (or few) that really clicks with your own palate.  Not everyone's going to have the same taste.  It's truly a subjective product — one of the most subjective products that I can think of — and everybody has their own personal preferences for flavor and feel and taste and aroma.  There are so many components to a wine, that not everybody is going to love reviews [from the same reviewer].  I know plenty of people who would never buy a wine recommended by Robert Parker.  And yet he is a big driver of wine sales in the nation.  So, I think consumers really need to dabble, and find that one reviewer or sample of reviewers that they can consistently rely upon to create recommendations.

Of course, also, a good thing to do is to tour wineries… but that's not always possible.  I think one of the reasons for the success of The Wine Spies is that we try as much as we can to bridge that gap between being there — having that in-winery experience, which is unrivaled — and buying online.  When we started this company, we shopped all our competitors.  And not only did they do a really bad job of describing and selling a wine, but in delivering it: the bottles were dusty and full of fingerprints, and with labels that were banged up… it's just not a pleasant experience a lot of the time.  So that's also been part of our focus… we take a lot of care with our shipments.  And we put fun into every shipment: each box is stamped with "Top Secret Wine Shipment" right there on the the outside of the box.  Inside, we throw in whatever freebies we can, we wrap the bottles in tissue paper…

But to get back to your question, I think customers need to find a trusted source [of recommendations] and I don't think they should find just one.  I should think they should dabble until they've honed in on one(s) that they can feel comfortable have consistently delivered quality wine recommendations.

NM: One last question.  Your final mission is on a desert island, and you're allowed wine from only one single varietal and/or region.  What would it be?

AR: {laughing} Oh, I'm glad you didn't nail me down to a specific wine…

NM: {laughing} No!  That wouldn't be fair of me!

AR: Okay, otherwise, I would have cried!  Okay, I'll give you the one varietal and region.  I'll say… California Cabernet Franc.

NM: Wonderful!  And unexpected!

And it's with those two words that I can't help but describe, as well, my overall experience in interviewing the sly and elusive Agent Red of The Wine Spies.  For more information, there's no better source that the website for the organization itself, The Wine Spies.