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A Majestic State of Nakedness

Published:  15 April, 2015

A short blog reviewing the surprising news which saw Majestic acquire Naked Wines

The acquisition of Naked Wines by Majestic in a £70 million deal last week already seems like old news given the amount of commentary on it. Always one to be a follower I thought I’d have my say.

 

I’m writing this partly as a consumer given I currently buy wine now and then from Majestic (admittedly mainly for corporate wine tastings when working to a budget) and have previously in my youth been a Naked Wines customer. I also spent five days in Napa a few years ago with Rowan Gormley and a few of Naked Wines’ Archangels helping them taste prospective wines to bring back and retail in the UK. This gave me a up close insight into Naked and their philosophy. Clearly being different was valuable to them and the word “disruptive” seemed to keep coming up. Rowan and the team at Naked had looked at the structure of wine sales (both here and in the US) and felt they could cut out a few layers.

 

Like or loathe the Naked model what they do better than anybody else is give their customers a unique chance to discuss the wines and give feedback directly to the winemakers. Their use of social media has been impressive and their approach to “extreme customer service” seems to keep their customers feeling loved. Majestic clearly are more traditional in their approach. They do use social media but no more than people such as Laithwaites and other comparable wine retailers and it can feel a bit tired. I’ve always seen them as being a more steady operator than Naked, certainly not seeking to be disruptive but instead offering their customers a chance to purchase wine in an environment where experts are readily on hand and a lack of specialist wine knowledge is by no means a pre-requisite. They’re not without their own good ideas though; the move to free delivery on 6 bottles (whilst seeming simple) was a good way of expanding their customer base without expecting online purchasers to buy 12 bottles.

 

So how will the two companies fit together? Well, what we know already is that there’ll be no merging of wines in Majestic stores, save that Naked customers will be able to collect wines purchased on the website from Majestic in a “click and collect” system (and it certainly won’;t hurt Majestic to have lots of Naked customers traipsing through their stores to collect their wine). I think this will appeal to some albeit the delivery offered by Naked is already quick and only costs £5. Perhaps the more exciting news (certainly for Naked customers) is the potential for Naked to access Majestic’s global network of winemakers who may have capacity (and the desire) to produce wines and perform in the Naked Wines model (with the inevitable hours spent in front of a computer responding to queries and feedback from Naked customers). Surely there are talented dynamic winemakers who Majestic come across who for one reason or another aren’t right for Majestic. Suddenly these winemakers may now have a new outlet. The benefits for Majestic? Well I suppose there will inevitably be some Naked customers who stray into buying from Majestic too, but more importantly is that Majestic have filled their CEO gap left by Steve Lewis with Rowan Gormley himself. If Majestic had been stagnating slightly before I strongly doubt Rowan will allow that to continue. He’s not afraid to shake things up as he’s proven at Naked and from my point of view it’s an exciting time to be a Majestic customer.

 

Given Naked are the ones being acquired here (although there is an element of reverse takeover to this given Rowan’s new role) I thought it’d be interesting to speak to a few of the Archangels I met on the Napa trip with Naked. Geoff Fitzgerald, who confesses to buying 80% of his wine from Naked commented that he sees Majestic as being a little “tired” and sees real excitement in the potential for Naked to expand their range (and avoid some wines selling out very quickly) by accessing Majestic’s network of winemakers, a point I agree with. I also spoke to Nathan McLennan who is uniquely qualified to comment here given he is a Naked Archangel and has just started working for Majestic. He assures me his joining Majestic wasn’t a term of the deal….. Nathan commented that the addition of Rowan to Majestic’s management is a great fit with Majestic having a strong proposition but having perhaps lost direction recently. He feels Majestic need a strong and proven innovator to get them back on track which is in my view exactly what they’ve just gained.


In the meantime, the wine trade will continue to maintain a watching brief on this story which I think it’s fair to say caught most of us by surprise. Whatever you think of Majestic and Naked though it’s certainly been an interesting story to follow and no doubt it will continue to be so.

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