More troubles at Lot18

[J_Galang]

@M A T T H A R T L E Y

Todd -

thought you might enjoy this:

http://www.os-fashion.com/vcs-think-my-boobs-need-an-algorithm/

Maybe we can get some VC funds for this…

Seinfeld - The Bro

[ToddFrench]

@M A T T H A R T L E Y

Todd -

thought you might enjoy this:

http://www.os-fashion.com/vcs-think-my-boobs-need-an-algorithm/

[Eric_I_r_m_s_c_h_e_r]

I never pulled the trigger on an order. More often than not I would be enticed by the offer email only to find out those offers weren’t available to ship here. That’s obviously not their issue, just offering my 2 cents.

[MarkAse]

So I do feel like I should at least chime in here-

I think the newspaper wine clubs can do ok, if you’re looking for something more like a Trader Joe’s alternative. Some of our competitors do a better job than others to be sure, but the real selling point there in terms of the newspaper clubs seems to be price.

As for Lot 18 and moving to a subscription model…I can’t agree more, even if I had 50x my current number of customers I’d need all of 2 customer service reps willing to pack some boxes for an hour or two a day to have enough hands to run the thing.

Their list is certainly bigger than mine by a exponential amount, but I also haven’t burned through 50M to get there while giving away ownership stakes to do it

[Jon_Troutman]

@gene keenan

@Todd F r e n c h

@gene keenan

I totally agree with you: it happens 100’s of thousands of times a year maybe more. VC’s are looking for the big payout, a modestly successful and growing company is not of much interest. You also might not be connected to the right people.

Yeah, it’s probably 99.999% about the connections. Seems funny, however, that so many VC funded companies fail, and that money just goes away. I’m sure some payouts are good, but are the sufficient enough to overcome the many losses?

I have friends that are serial startup founders. They jump from one failure to another living off of some investors money. Regarding payback: Like anything, for some it is and for some it’s not. KPCB, US VENTURE, SEQUOIA, and others have done well. On average though VC has done poorly. LOT18 to your point is one reason why…

Let’s not forget our board-contributing friend of Benchmark Capital!

[G_D_y_e_r]

@gene keenan

With a recovering economy, I can see the surplus market drying up and the Lot18’s of the world going the way of the Dodo bird. I’d say it’s not just wine though: I don’t see how all these “deal” sites can survive particularly when bigger players with more muscle like Amazon are entering the market.

This is part of the issue, but not all of it. The market is simply getting saturated with wine flash sale sites. And while they used to do a deal per day or week, now they tend to do multiples daily.

When there were a few players and a big glut of wine, they were really efficient at helping to re-balance a system overloaded on supply. Now it’s just another avenue to sell wine, usually at moderate at best discount. There just isn’t enough glut for every deal to be a real deal.

I’m sure a handful will survive. Woot is part of amazon, so they will likely be one of them. But the model has clearly gone from liquidation to a parallel retail outlet in most cases.

[Eric_LeVine]

Here’s a question. What percent of your purchases (think across all categories) are made at outlet stores versus regular retail? There is always a place for an outlet store, since there is always excess inventory to move. However what is the norm and what is the exception?

[Ken_V]

@Corey N.

@Todd F r e n c h

@Matthew B

They’re now at half the total employees as a year ago. Over the last 4 months or so, I’ve noticed fewer and fewer bottles on wine flash sale sites worth hitting the buy button (with exception of lastbottle).

Lot18 Sours on Flash Sales, Lays Off 25 as It Shifts to Subscriptions - Tricia Duryee - Commerce - AllThingsD

Are there any non-winery based wine clubs you enjoy (such as the WSJ, NYT)?

I called it almost two years ago - http://www.wineberserkers.com/forum/viewtopic.php?p=579832#p579832

Simply not a sustainable business model - once the funding runs out…

And I called it 10+ hours before you did: http://www.wineberserkers.com/forum/viewtopic.php?p=579832#p579466

I called it before either of you by never buying anything from them.

[ToddFrench]

@Eric LeVine

Here’s a question. What percent of your purchases (think across all categories) are made at outlet stores versus regular retail? There is always a place for an outlet store, since there is always excess inventory to move. However what is the norm and what is the exception?

Also, it’s an interesting retailing conundrum, as you are trying to sell a luxury/premium item at an outlet price - difficult to paint the picture properly, being attractive with pricing while preserving the value of the brand.

[Ian_Dorin]

@Todd F r e n c h

@Eric LeVine

Here’s a question. What percent of your purchases (think across all categories) are made at outlet stores versus regular retail? There is always a place for an outlet store, since there is always excess inventory to move. However what is the norm and what is the exception?

Also, it’s an interesting retailing conundrum, as you are trying to sell a luxury/premium item at an outlet price - difficult to paint the picture properly, being attractive with pricing while preserving the value of the brand.

The issue isn’t so much maintaining the price, but whether or not it’s actually a brand. That’s the real defining line since 2007.

I can tell you from all of the various ways we move wine, their is virtually no such thing in this business. And when it comes to certain brands (mostly Napa names like Caymus, Cakebread, Far Niente, etc) if you don’t have the most competitive price, you are likely to lose a customer over it.

[MarkAse]

Interesting Ian-I noticed on Wine Libraries site that you guys note yourself as having discounts.

We don’t…different models to be sure.

Competing with Lot18, Groupon and others has been a real chore over the past few years to be sure

Are you up for a forum fantasy baseball league?

[Ian_Dorin]

@MarkAse

Interesting Ian-I noticed on Wine Libraries site that you guys note yourself as having discounts.

We don’t…different models to be sure.

Competing with Lot18, Groupon and others has been a real chore over the past few years to be sure

Are you up for a forum fantasy baseball league?

It’s more of a state wide thing. Very different things going on in NJ.

I would love to do a fantasy baseball league, but promised the wife I would only do one this year.