Constellation acquires Gary Vaynerchuk’s Empathy Wines
Drinks giant Constellation Brands has acquired Gary Vaynerchuk’s direct to consumer company, Empathy Wines, less than a year after it was founded.
Hoping to grow its digital footprint, Constellation, which owns the Robert Mondavi, Kim Crawford and Meiomi wine brands, bought Empathy Wines for an undisclosed sum.
The direct to consumer e-commerce platform was founded by New York-based entrepreneur Gary Vaynerchuk and business partners Jon Troutman and Nate Scherotter last year.
Keen to disrupt the traditional wine distribution model by cutting out the middleman, the trio bypass distributor and retail channels and work directly with sustainable grape growers to produce their own range of wines.
Among the producers Empathy works with are Shannon Ranch Vineyards in Lake County, Bokisch Vineyards and Mettler Family Vineyards in Lodi, and Marietta Cellars in Sonoma.
Empathy sold 15,000 cases of wine last year and amassed over 2,000 subscribers. Keen to offer good value, the majority of its wines cost around US$20 a bottle.
“We started Empathy Wines as a radical new way of selling wine. We want people to pay less for great wines while shining a spotlight on top-tier grape growers – the unsung heroes of the wine world,” Vaynerchuk said at the time of Empathy’s launch.
“Old school laws and antiquated business models have forced wine lovers to unnecessarily pay too much for great wine. Empathy is able to produce and ship high quality wines directly to consumers who would otherwise pay double the price at their local retailer,” he added.
As part of the deal, the Empathy Wines brand will be integrated into Constellation’s wine and spirits portfolio.
Empathy’s employees will join the Constellation team, with Troutman and Scherotter overseeing day-to-day operations and Vaynerchuk staying on in a consulting role.
Constellation will benefit from Empathy’s brand building expertise and consumer insights to built its direct to consumer sales across the company’s portfolio.
“Empathy Wines has the right team and approach to help us deliver exceptional brands and experiences to our consumers, and thereby industry-leading growth, by expediting our ability to more deeply connect with consumers and build the strongest direct-to-consumer and digital commerce business in the category,” said Bill Newlands, Constellation’s CEO.
“Our ability to understand and ‘empathise’ with the modern-day wine consumer’s behaviour, wants, and needs has been proven through Empathy’s incredible growth,” said Vaynerchuk.
“We are excited to replicate this consumer-centric approach at a larger scale, and with more infrastructure, working with leadership that is making investments in a quickly evolving category.”
Born in Belarus, Vaynerchuk moved to the US aged three and began working at his father’s wine shop in New Jersey aged 14, joining full time in 1998. The success of his entertaining Wine Library TV videos helped turn his family’s humble Wine Library store into a US$60m business.
After filming 1,000 episodes, in 2011 Vaynerchuk ceased Wine Library TV, swapping it for video podcast The Daily Grape. In 2009 he stepped away from wine to launch social media focused digital agency VaynerMedia, which provides media strategy to companies like Pepsi and AB InBev.