Wine retailers that fail to modernise are in for a ‘bumpy ride’

The drinks industry is “way behind the rest of the e-commerce market” when it comes to technology, according to Virgin Wines’ Danny Cooper. What will happen if it fails to catch up?

Danny Cooper joined Virgin Wines in July 2024 and now leads digital transformation at the company as its chief information and digital officer.

His previous experience spans meal kit retailer Gousto and online fashion retailer Net-A-Porter, meaning when he joined Virgin Wines last year he entered the drinks industry with fresh eyes.

Coming into the wine industry as an outsider was “a bit of a shock”, Cooper admitted at the DB Conference last week.

Speaking during a session titled ‘Next-gen retail?’, he said that “there are definitely pockets of technology around that can really elevate the industry”. However, considering the drinks industry as a whole, he warned “it is way behind the rest of the e-commerce market”.

He continued: “For example, 15 years ago we launched the Net-A-Porter mobile shopping app, and I am yet to see a really good, strong, solid mobile shopping app that competes at that level with that kind of quality in the drinks industry.”

Cooper argued that wine retail and the broader drinks industry are “massively behind” in aspects like data insight and understanding of consumer behaviours.

This doesn’t count for all players. Karen Coates, COO for The Wine Society and fellow panelist, said the cooperative retailer has undergone a “massive transformation” over the last five years, driven by a focus on the data.

“Drilling into that data to understand what your consumer is all about is so, so, so important,” Coates said. The knowledge gained from this process has shifted how The Wine Society interacts with its members depending on which sub-groups they fall into.

Some, particularly older members, still like to receive information in print, while social media is becoming more important for younger generations.

“One size does not fit all,” Coates stressed. And a better understanding of data and technology is paving the way to better customer care.

Fellow panelist Charles Waud, MD of Waud Wines, which acquired Handford Wines last year, said social platforms have become an important part of the story for his business.

“We’ve sold a huge amount of wine, in reference terms for us, by Whatsapp, because I think people do look at their phones and you can’t ignore that little message,” he said.

AI is another part of the tech story for the wine retailer. Waud said: “There’s been elements of AI we’ve introduced [and] I’ve been so impressed how effective it’s been.”

Virgin Wines’ Cooper is adamant that technology is the vehicle to bring wine retail into the future. But businesses shouldn’t be using technology for the sake of it.

“The customer experience really has to count, how you connect with your customer, the messaging, the brands, how you uphold brand values, all of those things are really crucial, and doing that through the lens of technology equally is just as important,” he explained.

The Wine Society is asking the question: how can AI play into our space?

Coates agreed that the most important element of this is to use AI and technology to create an “additive experience” for the customer, rather than an impersonal one. “For our members and our relationship with them, it’s a very personal experience,” she said.

The fourth place on the panel was taken by Jonny Inglis, co-founder of Winedrops. Inglis agreed that improving the customer experience needs to be at the heart of any retailer’s use of technology, whether it be social media or artificial intelligence.

“I think good social media marketing has to start with themes or USPs, like the customer problem that you’re solving for,” he said. “When you start from the customer’s perspective, you end up with better creatives that perform better on social media platforms.”

Cooper acknowledged that technology is an “expensive investment” for any business, large or small. But he warned that “the future is coming, and you can’t stop that future”.

He said: “There will be a future a few years from now where customers don’t go on to Google to search for wine, they will ask an agentic AI to go and find the wine that they want.”

He warned that “if the industry doesn’t get onto that train, is going to find it a very bumpy ride”.

Indeed, in his view, the biggest threat will come from supermarkets; businesses which have “the money and the clout to be able to do that”.

If wine retailers don’t keep up, they are at risk of being left in the past.

On this point he was sure. Cooper said: “There really does need to be a recognition in the industry. You do need to modernise. You do need to accept the fact that consumer behaviours are changing.”

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