Naked Wines raises sales forecasts after shoppers crash website

Naked Wines is having to routinely test grapes for smoke damage in California as worsening wildfires linked to the climate crisis cause problems for growers.

Nick Devlin, chief executive of the online wine retailer, said it was taking the extra step due to the increased “frequency and intensity” of wildfires, which have affected growers in the US and Australia this year.

The company could not take the risk of buying “compromised fruit”, Devlin said. “It is not good for us and it’s not good for our winemakers in the long term.” Smoke damage, or smoke taint as it is referred to in the industry, resulted in wines that tasted “incredibly unpleasant”. The smokiness was at the “cigarette-ashtray end of the spectrum, rather than an enjoyable campfire”, Devlin said.

Devlin’s comments came as the company increased its sales forecasts for the year as shoppers flocked online to buy wine in response to the pandemic. The clamour for its Christmas deals even crashed its website.

The retailer said last week it had sold 40,000 of its luxury Christmas boxes in 24 hours. They include foodie treats such as olive oil and craft gin as well as wine. The surge in traffic overwhelmed the site, which was down for about an hour.

Sales at Naked Wines increased 80% in the six months to the end of September as more customers signed up for its wine deliveries – and existing ones, called “angels”, bought more. That surge had continued into the winter months, prompting it to upgrade its sales forecast. The company now expects annual sales growth of between 55% and 65%.

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Sales were up 80% to £157m at the retailer, which last year sold off its high street arm Majestic Wine. Despite the big increase, pre-tax losses widened from £5.4m to £8.1m.

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The bigger loss was blamed on a £4m hit relating to the sale of Majestic Wine stores in Calais. The value of the business collapsed after the government dented the lucrative booze cruise trade with less generous duty free allowances after Brexit.

Dan Lane, a senior analyst at the fintech firm Freetrade, said the share price of the “wannabe Ocado-for-wine” had almost doubled this year as it delivered the nation’s “lockdown libations”.

“The real test is hanging on to customers who flocked to the service during lockdown,” he said. “There are signs that we’re quite happy for this shopping habit to stick around … with monthly order rates rising and their flock of angels growing.”



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