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Terroir + marketing: a Danse Macabre


I went to a tasting today at Epic Roadhouse, the newish Kuleto restaurant with the stunning view of San Francisco Bay and the Bay Bridge. The tasting was of some current releases and barrel samples of various wines from a very well known Napa Valley Cabernet house, which I’m not going to identify no matter how much you hope I will.

I’ve given very high scores to this winery’s Cabs and have a great deal of respect for them. I’ve walked their vineyard in the hills above Napa Valley and witnessed how perfectly tended it is. The wines are extraordinarily fine and, by Napa standards, not very expensive. So it’s not like I have an axe to grind here. Just a point to make.

At one point the head of the winery explained how they used to vineyard-designate their top Cab made from their estate vineyard, but no more, because (and I paraphrase) “We want to make the best wine we can every year, and sometimes that requires blending out the estate vineyard with grapes from other vineyards.” Fine; I get that; I agree. Then we moved on to another wine, a barrel sample of a new proprietary blend. That wine, he said, will be exclusively from the estate vineyard, and will be the top wine it can produce, capturing the essence of the vineyard’s terroir. They all were very excited about it, he added.

Well, whenever I hear about a block or barrel selection from a vineyard that’s exciting and will capture essence, etc., my reporter’s skepticism is aroused. Sounds like language to justify a super-high price. So I asked, “How much will this new wine cost?” The guy hesitated, then said, “We haven’t set the price yet.” But if it doesn’t cost more than the regular Cab, I’ll buy you a bottle at full retail.

Think about the contradiction the guy made. First, he said they reserve the right to blend out the estate vineyard to make the best wine. Then, in the next breath, he said a wine that’s likely to be their most expensive is going to be exclusively from the estate vineyard, in order to capture its terroir.

Hello? Is it just me, or are these two statements mutually exclusive?

Well, actually, yes, if you’re talking about sheer quality. But no, if you’re coming from a marketing and sales point of view. Because the truth is that a gullible public is happily willing to pay more for a block or barrel selection, or something else that suggests exclusivity, than they are for a wine that was blended for balance, which may have a more general appellation. Which gets us back to the title of this post.

Danse Macabre

In medieval times a Danse macabre was a morality play to demonstrate the allegorical idea that we all must die, even the most virtuous among us. I use the term here to suggest that you might have the greatest vineyard, the best-tended grapes, the most talented winemaker, the best state-of-the-art winery; but Death, now in the figure of a marketing manager, is going to lead you to the same place as everyone else: the afterlife known as The Market, where everything — truth, contradictions, lies, terroir — is the same.

  1. File this one under “Bullshit” – as in: they’re dishing it out by the shovel full…

  2. Dr. Horowitz says:

    Did the more expensive wine taste better? Was your EP higher from the more expensive wine as Plassman et al. (2008) suggest? It sounds like other factors like the marketing manager were not controlled for in this case.

    That’s an interesting analogy. Do wine clubs and direct shipping save wines from the chupacabra?

    I admire how journalists strive for objectivity, but any good marketer knows that consumers are not completely rational. Our brains have rational, emotional, and instinctive components. People would like to think that they are rational, living in today’s information age in the midst of the digital revolution, but thousands of years of evolution have made it tough for people to ditch the emotional and instinctive parts of their brains that they use to buy wine.

    It’s fun to see what wineries do to try to create the Faberge eggs of wine, and to what how consumers fetishize these wines in return.

    Sorry in advance if any of my posts on Monday upset anyone. I’ll read them tonight.

  3. Dr. H, Actually I far preferred one of the less expensive wines. That most expensive wine was not particularly to my liking although, in its defense, it was a barrel sample, and could change dramatically once it’s bottled.

    What is an EP, who is Plassman, and what does “chupacadra” mean? Are these things I should know?

  4. Dr. H

    The fMRI study from Stanford/Caltech (in its discussion) pointed out that there is a way to assess sensory information in a rational and objective manner.

    This requires some practice. It’s like clinical work: you may have personal feelings about your patient but that does not change the true nature of their condition. For some, it takes some work, but it can be very zen-like in some aspects. (it can also be six-sigma – like as well).

  5. Dr. Horowitz says:

    Oops, I forgot to give Plassmann a second “n”. It’s the Stanford MRI wine price study.

    I think you’re safe from the chupacabra. They’re more common in Central America.

  6. Dr. Horowitz says:

    Arthur, yes, an experiment is a way for researchers to objectively study something (if it’s done right).

    But, the something being studied in Plassmann et al. 2008, the dependent variable, is EP (experienced pleasantness). If you are saying that EP is a rational brain process, then I need an explanation of how the following is a rational brain process (from Plassmann et al. 2008):

    “We found increased activation in the left
    mOFC and the left ventromedial prefrontal cortex (vmPFC).
    Another cluster was found in a superior part of the vmPFC
    adjoining the rostral anterior cingulate cortex (rACC). We also
    found increased activation in the dorsolateral prefrontal cortex,
    visual cortex, middle temporal gyrus, and cingulate gyrus.”

    I think that human behavior is so multifaceted that marketers will never be able to treat consumers like widgets. Six sigma is great for managing a manufacturing line, but not for making your customers think and feel that they should buy an expensive wine.

  7. Dr. H

    I have a copy of the full paper and have commented extensively on the blog threads where this study was *MIS*interpreted.

    I should start by saying that I earn my daily bread analyzing functional brain imaging for the purposes of psychiatric and behavioral diagnosis and treatment. Since all I do is brain, it adds up to a lot of brain scans. The orbital frontal regions mentioned are not specific and are parts of multiple circuits including the limbic system, attentional and executive function, etc etc. The Cingulate Gyrus is also multifunctional in all its regions. Nothing is specific in the brain – it’s about committee and not chairman. There is no grandmother cell and there is no singular region of the brain solely responsible for any singular function.

    That being said, the key part in the discussion (by the authors of this study) that everyone overlooked was that while there was a correlation between the suggested price, EP and orbital frontal region activation, the regions responsible for registering and recognizing aromas (and flavors) were not affected by suggested price and their activation did not reliably correlate to EP.

    The authors concluded that there must be a top-down modulatory process of the raw data which affects the EP. That modulatory function is not necessarily requisite and if the same study were performed with experts in organoleptic assessment, the results would be quite different – especially if one were to ask the participants to state EP and for a quality judgment based on deductive assessment techniques practiced by the court of master sommeliers.

    I agree that 6Sigma is not for marketing (but it can bring efficiency to customer service, hospital care, etc). I was saying that the deductive process of organoleptic assessment can be 6Sigma-like.

  8. SORRY, but here is the passage I had in mind:

    “Importantly, we did not find evidence for an effect of prices on areas of the primary taste areas such as the insula cortex, the ventroposterior medial nucleus of the thalamus, or the prabrachial nuclei of the pons. A natural interpretation is that the top-down cognitive processes that encode the flavor expectancies are integrated with the bottom-up sensory components of the wine in the mOFC, thus modulating the hedonic experience of flavor, but that the flavor expectancies generated by the change in prices do not impact more basic sensory representations. Interestingly, an analogous mechanism has been proposed for pain placebo effects (7). ”

    “Our results suggest that the brain might compute EP in a much more sophisticated manner that involves integrating the actual sensory properties of the substance being consumed with the expectations about how good it should be.”

    “Furthermore, the neural findings also provide some clues about the mechanisms involved. In particular, it seems that price changes modulate the representations of experienced utility but not the encoding of the sensory properties of taste in the primary gustatory cortex.”

  9. Dr. Horowitz says:

    Interesting. I guess the rational, emotional, and instinctive classification is not appropriate when you start talking about specific brain parts.

  10. What we consider reality, awareness and consciousness are the product of multilevel functioning. It’s a synthesis born of interconnected parts working independently but producing a top-level highly integrated construct that we call awareness. That does not mean it’s inaccessible.
    Instinct is sub-awareness functioning – a lower order of cognition of you will. It’s averbal because we do not attend to it regularly. But that does not mean that it can’t be verbalized. One just has to pay attention to the raw data and recognize when it is being modulated.

    My brain hurts…

  11. Arthur,

    Had the study involved only professional (daily) tasters such as Steve, Voss, Robinson, Parker, Laube or expert buyers would your conclusion rather than brain parsing have been more evident to researchers?

    These are people who taste dozen+ wines at a variety of price points every day therefore are not only good tasters but the concept of the impact of label, price point etc. are certainly not on the active radar during the actual taste.

    I’d relate the tasting pros to playing third base and always nailing a runner at first (even if the hitter is DiMaggio, Rose or…DRC).

    Am I too far off base?

  12. Hi Kathy,

    I am not sure I understand your question.

    If you’d like to discuss it in more depth, you can contact me through the email on my blog.

  13. Thanks, Arthur (will read your Sept 19 post first…).

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