The Commoditization of Wine: A Shift in the Wine Industry Pt. 2

Costco, as a major retailer, has played a significant role in the commoditization of wine. Here are some ways in which Costco's business model has contributed to this trend:

1. Bulk Sales and Low Prices: Costco is well-known for its bulk sales and offering products at discounted prices due to its high purchasing power. This approach extends to their wine offerings, where they sell wine in large quantities at lower prices. By offering wine at a lower cost, Costco encourages consumers to view wine as a more accessible and affordable commodity.  Not an agricultural product--let alone artisinal.  

2. Private Label Brands: Costco has its own private label wine brands, such as "Kirkland Signature." Private label wines are produced specifically for the retailer and often offered at lower price points. This reinforces the perception of wine as a commodity, emphasizing price and value over unique characteristics or terroir.  Frequently, grapes that did not make the cut for a major brand's wine get sold to co-packers for private labels. 

3. Limited Selection and Consistency: While Costco offers a broad range of products, including wines, their wine selection is limited compared to specialized wine shops or boutique wineries. This approach promotes a consistent and uniform wine shopping experience, further contributing to the perception of wine as a commodity rather than a diverse and nuanced product.  

4. Focus on High-Volume Wines: Costco tends to focus on high-volume, well-known wine brands that are widely recognized and often mass-produced. While this can be appealing to a broad customer base, it can contribute to a homogenized perception of wine and may overlook smaller, artisanal wineries.  To invoke sentiment from Part 1 of this blog, if we all keep reaching for the same wines everything will eventually taste the same.  So much for limited production wines.  

5. Emphasis on Consumer Ratings: Costco often displays ratings and reviews for their wines, using external scores and accolades to help consumers make purchasing decisions. While this can be helpful for consumers, it also places an emphasis on numerical ratings, potentially overlooking individual taste preferences and contributing to the standardization of wine appreciation.  Does a 90 point rating even mean anything anymore?!

6. Limited Wine Expertise: Costco's staff may have limited wine expertise compared to specialized wine retailers or sommeliers. While they may provide assistance, the focus on low prices and high-volume sales may overshadow the education and exploration of wine nuances.  

It is important to note that while Costco's approach has contributed to the commoditization of wine, it also serves a significant market segment, making wine more accessible and affordable for many consumers. Inclusiveness is wonderful.  However, for those seeking a deeper connection to wine's diverse and artisanal aspects, other specialized wine shops and wineries may offer a more curated and personalized experience.  At the risk of sounding shamelessly biased, shop with independents.