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16 WINES&VINES December 2016 WINE INDUSTRY NEWS S an Rafael, Calif.—In 2011, Wines Vines Analytics began tracking what was then the relatively new trend of third-party websites selling wine at deeply discounted prices for a short amount of time. Many of the wines being sold for between 30% and 50% off retail were well-known brands that were a hit with consumers on the hunt for bargains. Flash sites also proved a popular dumping ground for wineries and distributors stuck with held-over inventory from the recession that began in 2008. When Wines Vines Ana- lytics, which compiles data for the regular Wine Industry Metrics reports, began track- ing offers by the websites, the number of flash offers was growing by double digits every month. The conventional wisdom then was that as a product of the recession, the websites would soon falter, or the number of their offers would drop as the excess inventory of wine was sold. By 2013, however, that hadn't happened, and while a few smaller sites had disappeared and one leading website (Lot 18) had to reorganize itself, the amount of wine being offered through such websites had only grown. In September 2012, total flash offers were up 11% compared to the previous year, and in September 2013 they grew 17% to reach 559 such offers. September 2014 was a quiet month, and the offer total fell 34% from 559 to 371. The 12-month total number of offers, however, remained 18% higher than the previous year. In September 2015, the offer total shot up 88% higher than in 2014 and was 25% higher than in 2013. The Wines Vines Analytics team captures flash offer details as they are made public. All 17 flash websites are tracked, and each wine offer is reviewed and tied to the source winery. Wines Vines Analytics only tracks offers for domestic wines. The regular Wine Industry Metrics reports are also only focused on the U.S. wine industry. Each month the flash section of the met- rics reports contain the monthly total com- pared to last year and the rolling 12-month total of flash offers. For the first time since Wines Vines Ana- lytics started tracking offers, the monthly flash offer total has been regularly lower than the previous year. The monthly total was 6% lower in January, 18% lower in Feb- ruary and dropped in every other month except March, when it grew by 1%, and in May, when it was up just 2%. As growth in the number of flash offers slowed, all the other industry metrics have shown solid or robust growth. The volume and value of direct-to-consumer shipments has grown steadily through 2016 and was up 26% in September compared to Septem- ber 2015, with $82 million in sales. Total domestic wine sales in all channels also have grown steadily and were up 3% to nearly $3 billion in September. In the 12 months ending Sept. 30, nearly all of the 10 major flash websites offered fewer wines than they did in the same period ending Sept. 30, 2015. (None of the flash sites shares sales value or volume.) Invino, which has continued to offer the most wine of all flash sites, has made 9% fewer offers this year. Last Call Wines made 9% fewer offers; Wines Til Sold Out (WTSO) was down 11%, and Wine Woot's total offers fell by 22% Does the decline in offers indicate that the excess inventory of wine has finally dried up? Has the flash market proved as short lived as the name implies? Not all of the major sites have made fewer offers, however. Since it all but abandoned the flash market a few years ago, Lot 18's offer activity has steadily increased and rose 10% over the previous year. Last Bottle Wines' offers increased 26% from 399 to 504. Another key point is that offers are not sales. The websites could be reducing the number of offers to match sales volume, or they could be paring down the number of wines they sell based on those with a proven track record of selling. Wineshopper, which was purchased by Wine.com about a decade ago, also ceased offering wine this year. Tony Westfall, founder and president of Invino, said the company's revenues are up 20% this year. "Feels like (offers) should be pretty consistent though, but quite honestly, I don't consider us a flash site. We have Cel- larThief for that, and it's not really a metric I track," he said via email. Invino and CellarThief are both part of Sonoma, Calif.-based Good Company Wines, which also offers online wine stores, fulfill- TOP STORY Has the Sizzle Left Wine Flash Sales? TOTAL FLASH OFFERS PER MONTH 1,000 900 800 700 600 500 400 300 200 100 0 Flash Offers n 12 months ending October 2014 n 12 months ending October 2015 n 12 months ending October 2016 November December January February March April May June July August September October Source: Wines Vines Analytics.