Wine.Com has taken the esoteric and somewhat archaic direct wine shipping laws into their own hands. At the very end of last year Wine.Com, took direct aim at competing online wine retailers by engaging in their own “sting operation” to flush out competing retailers that flout the direct wine shipping laws. Wine.com claims to spend millions in an attempt to satisfy these laws for their own business needs.
This was first reported in the Wine Market Report 12/27/07, where they actually published some of the letters that Wine.Com wrote to state governments detailing these non-law abiding retailers, complete with order confirmations and receipts as evidence of the wine that was shipped illegally to Wine.Com’s “sting operators” in each requisite state. The Wine Market Report was immediately credited and re-told by Alder Yarrow in his venerable Vinography blog on 01/04/08 and the report itself, was archived at the Specialty Wine Retailer’s Association (SWRA) site here.
Since Alder’s post, the issue has exploded across the blogosphere and into more traditional print magazine sites, with both Wine Spectator’s Eric Arnold and Wine Enthusiast’s Jim Gordon reporting on the issue, in their own manner. Jim Gordon had the most interesting take, with an intelligent (and a reluctant) defense of Wine.Com’s tactics and spelled out many of the issues that I have considered while trying to sort out my feelings on this event. Comments have been piling up on the comment section of the post, as well as across other wine discussion outlets across the web.
I initially posted some brief harsh comments about Wine.Com immediately after reading about this story and I still stand by those comments, but have chosen to give my rationale on my blog. Other posters have included Wine.Com executives in rebuttal and many different bloggers around the web as well as wine retailers. Some of the most interesting posts have included a very creative insult/marketing push by Winemonger and a gentleman who canceled an $11,000 order after reading about the the tactics.
While I understand Wine.Com’s frustration with other competing retailers that don’t spend the capital to legally ship to the states where Wine.Com conducted its operation (Gordon’s well-constructed argument and Wine.Com’s angle), these types of “ratting out” activities just do not sit well with my own set of ethics. Rich Bergsund (CEO) and Mike Osborn (Founder) of Wine.Com rationalize that their own activities were necessary to bring the illegal shipping of their competitors to the eyes of state alcohol regulators. Yet, using illegal tactics to point out the illegal tactics of others just strikes me as completely unethical and counter-productive, not to mention just plain asinine.
Feel free to read more about the background on this issue on Vinography, that includes much of the history of this issue since the 2005 US Supreme Court Granholm Decision, or do your own research at SWRA site and Free The Grapes! Perhaps the best silver lining that I can add to this issue is that it has *certainly* re-sparked some major discussion and debate on this important topic and issue facing the wine industry, which can only be a good thing.