Naked Wines sees sales surge as lockdown boosts wine sales

With restaurants and bars shut due to pandemic-induced restrictions earlier this year, the online wine seller recorded a surge in sales and even had to temporarily suspend orders in March after unprecedented traffic on its website.

The firm has raised its full year sales forecast as a result of the huge demand.

The group said many customers did not know they could order wine online, to be delivered to their door, until Covid-19 motivated them to look, and they are now embracing it.

Naked Wines is preparing for a bumper Christmas as people resign themselves to having to stay indoors over the festive period.

The firm said that over 40,000 Christmas Deluxe Christmas Collection cases were pre-ordered within 24 hours of launch, with three cases being sold every second during a one hour period.

Customers snapped up the cases, which included a number of luxury freebies such as a craft gin worth £39.99, Noble Isle hand wash and lotion worth £39.99, craft cider worth £9.99 and Extra Virgin Olive Oil.

This caused an unprecedented threefold surge in traffic, which resulted in the site going down for an hour, before being restored to full service.

The firm said its Christmas cases sell out every year, but early demand has been higher than anticipated.

The group operates an unusual model, whereby investors or "Angels" pay a direct debit of £20 a month. They can then deduct what is their account when they buy a crate of wine.

Analyst Jonathan Pritchard said: "Naked Wines' interims showcased a superb second quarter (sales up around 85 per cent) and we would guess that the third quarter has seen more of the same so far.

"Covid-19 has created perfect conditions for Naked to thrive, so do these stellar numbers actually matter to the big picture? Very much so.

"Existing customers are spending 80 per cent more, but the retention rate of new Angels is sky high (95 per cent). Naked also believes the US wine drinker has finally cottoned on to the presence of an online option."

The company now expects sales growth of 55 per cent to 65 per cent for the current year, compared with an earlier forecast of 40 per cent.

The business, developed by Majestic Wine, said that the positive trading momentum has remained into the start of the second half, adding that the company was “mindful of significant levels of political and economic uncertainty".

Naked Wines reported a narrower first half adjusted loss before interest and tax of £3.2m, compared with a loss of £4.5m a year ago.

It posted revenue of £157m in the 26 weeks to September 28, up from £87.5m a year earlier.