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Amazon Pauses Wine Program

by Tim Elliott on October 28, 2009

Amazon Pauses Wine Shipping It’s been a long time since I’ve posted anything here so I thought I would start back with a big story that broke last Friday. As you have no doubt seen elsewhere, Amazon has put their wine program on hold. While I’m disappointed with this turn of events, I’m not that surprised given the state of the economy and the collapse of New Vine Logistics, Amazon’s wine logistics partner.

Coverage in the wine blogosphere has ranged from somewhat optimistic to outraged to, well, depressed. I have a somewhat different view on this since Amazon is really not saying that much outside of the fact that they have discontinued their wine shipping program they had been testing for the past several months. In the email many of us received from Amazon on Friday, they never said they were pulling out of exploring the wine industry, just that they would not be resuming their test program. This leaves the interpretation open to the commentator and most everyone has concluded Amazon is exiting the wine industry.

I disagree with this opinion and think that Amazon has simply pushed the pause button. At some point in the next 18 to 24 months they will again look to establish some sort of wine program because many of their current customers want to buy wine from them. The simultaneous economic meltdown and collapse of their logistics partner just means they can’t figure out how to profitably sell wine within the current environment. A lot can change in the future from IBG’s revitalization of New Vine’s business to changes in legislation that will make wine an easier product for Amazon to sell.

Mark my words; Amazon will change the wine business. They will just not do so in 2009 or 2010 as most of us thought. Once the economic and regulatory situation becomes more favorable, Amazon will un-pause their program and will figure out a way to make money doing so.