The first online wine auction site, WineBid, celebrates its 25th anniversary this fall. WineBid continues to grow, moving 250,000 to 300,000 bottles annually, according to the company. 

Last year was WineBid’s “biggest year ever,” CEO Russ Mann said recently. “This year, we’re already significantly ahead of last year.”

Wine Auction Market Matures

In the years since WineBid launched, the wine auction market has evolved: The market is more transparent, more diverse, and East Asia now drives the market with WineBid as well as the other major houses all having a presence in Hong Kong. 

It has become easy to access extensive information on the market for any given wine, which wasn’t the case even a few years ago. Access to data has also tempered the wine auction market: people once flipped their cult napa wines allocations at high prices but there’s less of that now because there’s more transparency 

WineBid was the first online wine auction house, but all the major auction houses now sell online to a degree or another, which has accelerated recently for obvious reasons. In this respect, wine auctions have followed the general retail trend of migrating transactions online. In 2000, Wine Auction houses realized roughly $100 million in revenue. In 2020, revenue exceeded $400 million.

The pandemic only accelerated online sales. “The world of wine and spirits was already moving online very quickly,” Mann said. 

Whereas wine auctions of the past were almost exclusively about Bordeaux, Burgundy, Port and Champagne - today, they sometimes include California cult wines but also wines from Italy Span, Germany and even Australian wines, mirroring the diversity of wines in the general market.

Authentication a big part of the business

WineBid is not a wine retailer and does not own the clients’ wine. “We help sellers and buyers connect, which is pretty unique,” Mann said. 

Collections consigned with WineBid usually start at $10,000. Screaming Eagle, Sine Quan Non and Chateau Lafite Rothschild and other prestigious labels were among the brands sold online recently to the highest bidder.

Each bottle is photographed and inspected at the warehouse. A few months ago, the staff found a bottle with a label that had been laser copied. 

“Wine authentication is a very interesting part of this business,” said Paul Walker, WineBid’s vice president for the western region.

Wine collectors reach out to WineBid to sell wine for various reasons. They may have too much wine and not enough room to store it, or their taste have changed. “Maybe they bought a lot of Napa Cab and now they want to get some Burgundy,” Mann said.

Collectors may also consign bottles of wine they are forced to sell after a divorce, according to the company. 

Buyers and sellers have become more diverse over the years. Buyers are younger, interested in wine at all price points, Mann said. 

About 70 percent of WineBid’s clients are from the United States, 20 percent are from Asia and 10 percent from Europe, Mann estimated.

Wines have become more expensive over the years, though WineBid auctions wines at all price points, according to the company. In terms of dollar value, 40 percent of the bottles are from Bordeaux, 30 percent are from Burgundy, 20 percent are California Cabernet Sauvignon and 10 percent are everything else, Mann said. There has been “really big uptick” in value in Burgundy wines. German Rieslings, Southern Rhone and Italian wines have become more popular, Mann said. 

Wines from the Pacific Northwest have received a lot of attention and have come up in value too, he said. 

Wine bottles arrive at WineBid in various ways. They may be brought to the warehouse or shipped from cellars or professional storage with temperature and humidity controls. Contractors hired by WineBid also collect the wine, particularly when it involves large cellars. 

WineBid has led auctions raising money for various organizations over the years. During the pandemic, wineries donated wines to raise money for Wine Country for Restaurants. WineBid also supported the Restaurant Workers’ Community Foundation and helped restaurants sell wine at deep discounts.

Wine and auto racing enthusiast Chuck Parsons founded WineBid in Chicago in 1996, starting with two employees, and his 10,000-plus wine collection. He later moved the company to Napa before selling it to an investment group a few years later. Since 2017, WineBid has been a division of Third Leaf Partners, an investment group focusing on the hospitality and beverage industries. Winebid.com is headquartered in Seattle though its warehouse operations are in Napa. 

Online food and beverage sales are expected to continue to grow. Food and beverage e-commerce in the U.S. totaled $18.7 billion in 2020. Online revenues are expected to reach $25.7 billion by 2025, according to Statista.