Slurp CEO unveils ambitious online expansion planBy Patrick Schmitt
Slurp CEO Jeremy Howard has added a service for UK beer enthusiasts and plans to roll out his web-based wine retailing operation into new markets.
He described the UK as "the most developed and competitive online wine market in the world,” when speaking to the drinks business last week, adding: “Building an online wine business in the UK is like doing all your training at base camp at Everest, if you can make it here, you can make it anywhere.”
Having created what he described as a “profitable” online wine retailing business in the UK with slurp.co.uk, he is now enhancing the online brand’s presence in the Far East with slurp.asia, which, “although not a major platform yet,” is sourcing fine wine in Hong Kong and selling first growth Bordeaux to buyers across Asia.
“What I have in mind is a family of brands that are all called Slurp but tailored to the local market,” he told db, adding: “We are probably starting with France this year.”
The proposed site will be called Slurpvin because “Slurp doesn’t mean anything in French,” and will offer a range of well-known or celebrated wines that aren’t widely available in France.
“It will be a well-presented French language site offering wines that the international press are writing about, such as Penfolds, d’Arenberg or Greywacke, and I am sure there is good demand there.”
Continuing he said: “There are 83 million people in France and provided people are happy distributing the wines I am sure we can build an interesting niche market – even if we are only known for selling wine that is made outside France in France.”
As for the retailing of other alcoholic drinks, slurpbeer.com went live on Friday to offer a range of over 1,500 specialist beers, complete with critics’ reviews, because "existing online retail platforms just don’t justice to the exciting, high quality products available,” according to Howard.
He also hopes to add slurpspirits to the range. “There are 2,000 vodkas available in the UK alone,” he explained, “and so there is a huge opportunity for internet retailing because no single shop can ever offer even a tenth of that.”
Speaking further of the Slurp strategy, he said: “Whether it’s wine, beer or spirits there is an explosion of products and that lends itself to online retailing.”
This is because, he added: “You can’t fill a whole shop and still be profitable but online you can sell a smaller quantity of a much broader range of products.”
Slurp.co.uk currently serves more than 25,000 customers with a range of 6,500 products, “which is increasing all the time”, and while a “large proportion” of the range is held in the company’s west London warehouse. “If it’s not, we can get the product within a day or two through our integrated supply chain,” Howard told db.
Speaking of further opportunities in the UK, he said: “The UK wine market is worth around £14 billion and around half of that, £7bn, is sold through the supermarkets. Then there’s £3.5bn which goes through the independent sector – from Majestic and Laithwaites to cornershops – and another £3.5bn through the on-trade.”
Of this, the online wine market Howard believes is worth between 10-15% of the £3.5bn “independent sector”, so over £350 million, and, he said, “it’s showing 25% growth.”
“There is no question online is where the growth is in wine,” he stated.
However, Howard stressed: “This is not new demand, it is coming at the expense of other areas, so it’s no great shock to see the demise of Threshers and Oddbins as internet retailers like us rise quickly.”
Indeed, the IMRG Capgemini e-Retail Sales Index results showed that £5.2bn was spent online in all sectors during April, with alcohol experiencing the highest growth – sales rose 20% on the previous month and 55% year-on-year.
As the data analysts report, the strong online growth in alcohol sales was driven by the bank holidays, the Royal Wedding and almost ceaseless sunshine.
IMRG Capgemini – which doesn’t report total volumes for alcohol sales online – also recorded an average order value of £174, which is the highest “basket value” since November 2007, before the start of the recession, and nearly double that of April 2010.
the drinks business magazine will feature more on Slurp and CEO Jeremy Howard’s strategy in a future edition.
Patrick Schmitt, 20.05.2011