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I am writing to update you on recent and upcoming developments. It is hard to believe, but next year marks Liv-ex’s 20th birthday. Justin Gibbs and I started Liv-ex in July 2000 with 10 London-based members who, against their better judgement, were kind enough to give us a go. The membership currently numbers 472 trade businesses in 42 countries. We would like to thank you for your support over many years.
The last 12 months have been challenging for many of us. Brexit uncertainty, US tariffs and difficult economic conditions in Hong Kong and China have been very disruptive. Despite these challenges, the market has remained remarkably resilient. Transactions on Liv-ex are up 20% at the time of writing. Both the number and value of wines available on the platform continue to grow exponentially, offering unmatched choice and opportunity at competitive prices. At the time of writing, we have active markets in 12,000 wines with a value that exceeds £70m. All available in real time and backed by our contract.
Our considerable investment in technology, and in LWIN and Automation in particular, have been an important factor behind this trend. The 5% of customers who have now integrated their stock or web shops with our Automation services now account for 30% of trade on the platform. For these early adopters the impact on revenue has been significant with a sharp increase in new business and customer acquisition.
We have further refined our Market Price logic during the year to improve the accuracy of this benchmark across more than 200,000 wines. We have also added to our database of prices, which now contains more than 644 million price points. Users of Wine Matcher will hopefully also have noticed enhancements to its machine learning capabilities which now generate much higher and faster matching rates.
We hope that you have also started to try our new trading platform. We are currently investing in the search functionality, which we believe will give you an ability to explore the market in ways that aren’t possible elsewhere. You will be able to filter our entire database of markets and prices by cru, vineyard, appellation, region, country, price, bottle size, contract and/ or vintage. The new site is enabled for mobile and is much faster than the existing system. About two thirds of customers have already migrated across, but for those still on our legacy system, this will come out of service for the last time in January.
Next year we are going to work on streamlining our notifications and emails to deliver more relevant trading opportunities for you. We also intend to expand the number of currencies that we trade in (beyond GBP and Euro) and will be launching a new home for LWIN – the FREE universal wine identifier – together with a new family of APIs that will enable users to request LWINs and stay in sync with its database of wine descriptions and numbers in real time.
We have recently announced that we sold Cellar Watch – a cellar valuation tool – to Vinous, Antonio Galloni’s publication. We are sad to be losing this popular service, but the website – which predominantly serves private customers – has long sat uncomfortably alongside our portfolio of B2B services. We are delighted that Vinous have committed to invest and grow this service and will be continuing to license Liv-ex data to power their valuations.
We have already communicated that we will be increasing the price of our logistics services for the first time since 2013, but you will be pleased to note that we will not be adjusting prices for our trading and data packages this year.
On behalf of all at Liv-ex, may I thank you again for your support and, if it is not too early, wish you a very Happy Christmas and a prosperous New Year.
Best wishes,
James Miles
Chairman
