Inside Gratsi: How a Boxed Wine Startup is Revolutionizing the Industry

Three years ago, a group of wine industry outsiders took a bold step into the sector by offering premium, non-vintage and non-varietal wines priced at $40. The bold part? It’s boxed wine.

Boxed wine has never had a stellar reputation among even casual wine drinkers, but meeting sustainability goals has winemakers rethinking the entire process, including how wine is packaged.

Gratsi Wine’s unconventional approach has proven successful; the Washington-state brand says it is on track to sell more than 200,000 cases this year.

Gratsi’s marketing strategy—centered around connection and community—has played a significant role in its success. Inspired by the simple Mediterranean lifestyle, Gratsi aims to bring the essence of slow mornings, quiet towns, fresh food and great wine into the homes of its customers. The company utilizes captivating storytelling and vivid imagery of Mediterranean destinations across its digital platforms, offering recipes, music, movies and books to inspire and connect with consumers. Additionally, products like Gratsi glassware and a recipe book enhance the immersive experience, encouraging customers to savor life mindfully.

In 2023, Gratsi Wine expanded from its direct-to-consumer model into retail markets, beginning in Connecticut, where over 1,000 cases were sold in April. As of June 3rd, the company has expanded its retail presence to Delaware, Maryland and Washington, D.C., continuing its growth and reaching new markets.

Gratsi founder Stephen Vlahos recently shared more with Forbes about market expansion, innovative strategies, challenges and future plans for the winery.

We launched as a direct-to-consumer company during Covid, and the box was a perfect way to ship wine to customers as a 9-liter case of boxed wine is one-third of the weight and one-fourth of the size of a 9-liter case of bottles. To us, DTC is a totally different competency than launching retail. We wanted the retail launch to be focused and limited, really figure out how to convert customers in person versus online, and then scale.

We have always seen Gratsi as a large-scale commercial grocery product, so we wanted to pick a broadly representative American market and not a unique large metro like New York or Los Angeles. Connecticut was perfect for us because of its great food scene and diverse immigrant culture, and it was an avatar for the rest of the country.

Initially, we encountered resistance from distributors and retailers because we were the first to market a $40 box of wine on a large scale. So we proposed: just place it in the store and we will attract customers through tastings and events. Customers in Connecticut began purchasing the wine in substantial quantities, convincing our distributor to expand our reach. It’s crucial for us to be in markets that reflect the American consumer broadly, not just confined to major metropolitan areas.

For us, the prime considerations for our wines are quality, taste, and the price-to-value ratio. We aimed to stay open-minded about the wine’s origins. Our top objective was to find the best wine at the best price. After sampling wines from various regions, we fell in love with Washington state. We found the wine to be exceptionally tasty and reasonably priced. We had a desired profile in mind, without any bias towards a specific varietal.

Our goal for the wine was to evoke the essence of young European table wines—meaning no oak treatment—resulting in young, fruity, and dry wines that are easy to enjoy with or without food. Additionally, we believed that the bag-in-box format, if executed correctly, held significant market potential. It’s ideal for home consumption; it just needed an excellent wine and brand to legitimize the category.

Our wines are grown and crafted using certified Sustainable Washington and Washington salmon-safe standards, which signify a commitment to high-quality fruit, environmental stewardship, and healthy communities. These standards encompass natural intervention practices to the greatest extent possible, including minimal spray treatments, the natural suppression of weed growth through competitive row crops like wheat, the elimination of harmful vineyard runoff, water quality protection, enhancement of native biodiversity on vineyard sites, and fair wages and safe working conditions for workers.

And Gratsi wines are clean and keto-friendly thanks to being zero sugar and only using all-natural ingredients. Many wines are fermented dry and have very little to no residual sugar at the start of the winemaking process. However, due to the use of low quality and inexpensive fruit as well as poor winemaking practices, these wines then require sugar and a host of other additives to be added back into the wine to make a finished product that is palatable. This leads to a wine that is not clean drinking and contains considerable amounts of residual sugar. Gratsi uses only the highest quality fruit from vineyards that use sustainable growing practices and never adds sugar or unwanted additives to enhance color or flavor.

Our entire team has a deep love for and fantasy of living the slow, simple Mediterranean life. We find creators who we personally find interesting and look for recipes, playlists, travel guides and general content that we personally love. Then we just try to share it with our customers.

The biggest challenge from the beginning was converting the $12 to $30 per bottle customer to start buying boxed wine. It has been a slow grind, but once customers trade in the bottle for the box, they stay. It seems that the tide is turning and customers are starting to adopt the premium boxed wine as a full time replacement for their $20 bottle.

As customers are focusing on how much they spend at the store, the box is a clear cost savings mechanism. Plus, the boxed wine packaging is so efficient, it allows us to have a bigger budget for the wine itself. Once customers pay half the price as they would for four bottles and the wine is superior, it’s game over.

Our team is full of wine lovers, but no one is from the wine industry, so we have taken a very elementary, common sense approach to our strategy. Do we love this brand? Is this our favorite wine to drink? Do we like the way that it tastes and how it makes us feel the next day? We were really blown away at the contrast between American and European wines, in regards to the residual sugars and additives. We just said, let’s make a wine that reminds us of a pitcher of European table wine that you would have at a cafe in Sicily. If people like it, great. If not, that’s okay, too.

We feel very confident that we know how to successfully activate a market. Our plans are to expand into more than 15 states by 2025 and all 50 by 2026. It’s time for Gratsi to hit the mainstream at scale. We do not have plans to expand our offerings as we feel we cover the spectrum for our customers. It’s possible that we offer smaller volume packaging, but it isn’t in the short-term plan for the business.

Internally, our team has a fantasy of living the slow life in the Mediterranean and the name is paying homage to this lifestyle of the slow, simple life. “Grazie” means thank you in Italian, but that spelling was too expensive for us to trademark. The domain name of “Gratsi” was very reasonably priced, so Gratsi it is.

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About the Author: Chris Lehoux

Meet Chris Lehoux, an experienced wine connoisseur and dedicated blogger with a deep passion for all things wine-related. With years of expertise in the industry, Chris shares insightful wine reviews, valuable wine tasting tips, expert pairing advice, and captivating tales of vineyard visits. Join Chris on a journey through the world of wine, where every sip is an adventure waiting to be savored!