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Happy Birthday South Africa wine. It won’t be easy to penetrate the U.S. market

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Monday was the 350th birthday of South Africa’s wine industry. The country is the world’s ninth biggest wine producer, and Wines of South Africa (WOSA), a trade group, is hoping to “reach a million people…worldwide” in promoting its wines.

Have you ever bought a South African wine? Neither have I. That’s exactly the problem for the South African wine industry, which has formed a brand new trade group, USA [Union of South Africa] Producer Association (USAPA), to promote consumption of South African wines here in the States.

The 100-member trade group, which had its first meeting on Jan. 20, the same day Barack Obama was inaugurated, could well have adopted the President’s catch-phrase of “Yes, we can.” Their stated aim: “to build a South African presence in the US market, set to become the biggest wine importer by 2012. We believe our mutual co-operation will help considerably to augment the impact of the South African wine category in this exciting market.” The South Africans have a certain resentment toward their fellow Commonwealth brethren, the Australians, “who just over a decade ago were only a fraction of the size of the South African industry,” but who conquered the American market through their Shirazes, Chardonnays and Yellow Tails. “Perhaps the time is ripe, now that Australia is starting to lose…consumers…, to make a relatively bigger noise in the right corners of the US market,” concludes a South African marketing guru, Greg Castle. He suggests appealing to “those [Americans] in more open minded wine circles, less blindly brand loyal to Californian or French wines; opinion leaders prepared to explore and try something new.”

Well, this is all well and good, and Castle and the South Africans are doing what they should be doing in promoting their country’s wines. But South Africa has a long way to go before it hits pay dirt the way Australia and New Zealand did in America. For one thing, South Africa has no particular image to hang its wines on, as Australia did and does. Australia is Oz, the Land Down Under, populated by friendly, grinning, good-looking types who toss shrimp on the barbie and who, descended from criminals, have a roguishness that appeals to Americans. But what is South Africa famous for, except (bless him) Nelson Mandela?

Then too, South Africa hasn’t attached its name to any particular wine types that aren’t already famous from other countries, with the possible exception of Pinotage — and who cares about Pinotage? Their Chenin Blancs are good, but I don’t see America being overwhelmed with Chenin Blanc-mania.

I don’t taste a lot of South African wines, so I went to Wine Enthusiast’s database to see what our other editors — primarily Roger Voss — think. Roger’s top-rated South African wines mostly are expensive ($30-$93), which is not the best way to break into the recessionary U.S. market. Castle wrote that “Once [Americans] get to try ‘Brand South Africa’, it must be ensured that they are suitably impressed by the value for money (not to be confused with cheap price) relative to the exceptional quality,” but it is not clear to me that “value for money” is a distinguishing feature of South African wines, the way it is with, say, Chile. Shifting “brand loyalty” is one of the most difficult tasks facing marketers, especially when economic times are uncertain; people tend to stick to the tried-and-true.

Finally, Americans already face a bewilderingly vast array of countries that produce good wine. They’ve shown their willingness to expand beyond California (and old Europe) to Australia, New Zealand, Chile and Argentina, not to mention wines from their own backyards; all 50 States now possess bonded wineries. So I just don’t see U.S. consumers embracing wines from South Africa in any number. I could be wrong.

If I were giving the South Africans advice, it would be to personalize their wines, to attach them to a famous individual, a celebrity endorser, so to speak. In 21st century America, the way for trends to start is through stars. And South Africa could do no better than President Obama, who famously celebrated his November electoral victory by popping open some Graham Beck Brut, a South African methode champenoise bubbly. USAPA ought to be announcing that in every corner of the U.S. market.

stellenbosh

Stellenbosh

  1. I live in Austin TX and have actually been buying South African wine for a number of years that i have purchased at several places here in town. I have done both whites and reds, and as a matter of fact have been drinking a really reasonable Jardin Cabernet Sauvignon 2005 that I buy at Costco for less than $20. White wise, i have been drinking 2007 Mulderbosch Sauvignon Blanc that is a typical SA Sauvignon Blanc for around $20.

  2. Kind of ironic that you’re burying South Africa’s prospects fro progress in the U.S. market even as they celebrate 350 years of winemaking… If the last couple decades have taught us anything wine-wise it is that good wines manage to find an audience. And the fast-track growth of New Zealand suggests that it is more likely that Americans can embrace “new” wines rather than established ones.

    The fact that Roger Voss’s highest-rated South African wines are also the most expensive is hardly a shocker. Can say exactly the same thing about critics’ ratings (yours included) of all region-specific wines: pricier wines DO get rated higher. And crisp, refreshing, dry Chenin Blancs have traditionally gotten the shaft from every publication that uses the 100-point scale, while 14+%-alcohol reds have been anointed the creme de la creme.

    For sheer value, I don’t think it gets much better than South African Chenin Blanc. Try a bottle of Indaba, Mulderbosch or Sebeka. I think Americans will take gladly to the novelty and value and general high quality of South African wines, sooner rather than later.

  3. Larry the Wine Guy says:

    I just returned from a wine tour of South Africa. In general South African wines offer incredible value. Tish has it right. Whites wines including an incredible array of Chenins, Sauvignons and unusual blended whites are South Africa’s best opportunity in the US. I am certainly not dismissing the great range of Cabs, Syrahs and Pinotages but the whites were simply more impressive and practically applicable to the US wine market. NZ SB and Argentine Malbec enjoyed not great identity as recently as 15 years ago. Why can’t South African Chenin Blanc acheive similar success?

    South Africa’s challenge will be importation and distribution. I am positive retailers and restaurateurs, particularly independent retailers and restaurateurs, will embrace South African wines. The current economic environment begs for wines such as these. Unfortunately, the delivery mechanism, large suppliers that control an increasingly consolidated distribution network, makes South African wine availability scarce. Yes, the large co-operative wineries have presence in the US market and there are some very good wines amoung these portfolios. Yet most South African wineries are quite small, a producer of 20K cases is considered very large. This means little or no opportunity in the ranks of the big suppliers and distributors. Yes, there are a few stalwart importers doing yeoman’s work with some of the most quality oriented South African producers but I met over 2 dozen producers in search of representation in the US.

    If only I had the entrepreneurial gene and a big stash of capital!

  4. I have indeed bought and enjoyed many SA wines.
    Waterford Estates, Rupert &Rothschild, Iona, DeWetshof are a few that pop to mind.
    As noted above, SA Chenin Blancs are amazing value and should be an everyday white wine in every winelover’s fridge.
    SA is probably the most beautiful wine country I have visited as well.
    Unfortunately, the U.S. market was flooded with low cost, low quality SA wines in the 90′s and they have had an uphill battle to encourage American consumers to embrace all the wonderful SA wines now available in the U.S.

  5. Joanna Breslin says:

    Thanks to all who responded to this post with their more positive experiences with South African wine. I spent three weeks of last year visting wine producers there, and attending their big trade event, Cape Wine. I was blown away by the spirit, the rapidity of improvement in the wines, the excitement about cooler and more elevated vineyard sites and the relatively new access to virus-free vines.
    Unfortunately, Steve is correct in pointing out that the South African wine industry has not done a good job of promoting itself here. WOSA has a good website, but little presence in the market. As Larry the Wine Guy points out, most of the producers are not in a position to hire a marketing person for the US.
    The striking thing about many of the better South African wines is their combination of Old World and New World styles. Though they may display bold, upfront fruit, they are restrained by their structure and often pronounced minerality. These guys are not going to build their reputation on cheap and cheerful, but I believe that value for the money in the middle price range is one of their strongest assets.
    I volunteer to get this message out. Larry, can we talk?

  6. Having been to most of the world’s great wine regions (though Argentina and Chile haven’t coincided with my budget yet), I agree that the Cape Town winelands are the most dramatic. And, judging the tourism against Napa, it is a terrific surprise to find both very good restaurants and accoms at wineries!
    I have never understood how a country that appears to take credit for Nelson Mandela’s release (remember the thrill of Mandela’s appearance in Oakland, was it in ’92?) and the end of apartheid could then simply ignore the country, let alone its wines. I realize one does not lead to the other but I am sorta disappointed on both fronts. Then again, as we know from the election, most of the US doesn’t realize South Africa is a country and Africa is a continent (a very big one).
    So, why has the spark not ignited? Well, when was the last time you saw a story with a South Africa dateline in your local paper/news site? And if you did, what kind of crisis did it reveal? Whatever it was, it certainly wouldn’t have made you think wine at the store. That’s the disconnect. (We are seeing a decline in Australian wines, is there a relationship with all the dire drought stories?).
    So, SA is hosting the World Cup in 2010 (despite rumors it is not ready and games will be moved to Spain…see graph above). There are an awful lot of soccer moms (ask Sarah Palin). And moms buy wine. Moms like good value. Is there a link here? What’s Gallo’s take on this? It imports a SA wine. Does it support this new SA wine venture?

  7. Kathy, I think the American media, public and politicians in general ignore Africa.

  8. South African wines are as good as any other wines. I myself have been buying both red and white wines for the past year, and their taste is amazing. Recently, there was a party at my house and Merlot, Pinotage, Chinin Blanc were some wines offered to guests. All these were from Perdeberg Winery (http://www.perdeberg.co.za). I came to know about this particular Winery when my friend bought me a bottle from there.

  9. From where I sit as a South African grower, wine-producer and marketer, I find all these comments just so interesting. I have travelled to the USA 2/3 times a year for the past 8 years to market and sell my wines. (Ken Forrester Wines) we have had some amazing successes and great listings Restaurant Eve in Old Town Alexandria, Grand Central Oyster Bar, Grand Hyatt in New York, Hyatt in Chicago, Budokan, Union Square, Morrels, 10 degrees South in Atlanta, the Oceanaire in Atlanta and so the list goes on and on. We are currently enjoying an annual growth in excess of 30% even in these times, we have a list of great ratings at Winespectator.com, go see all the SA ratings there, way more than you might think and some great ratings for some very affordable wines. Right now as the economy is heading south I would like to say that SA wines really do offer some of the best value possible, please find a bottle of our “Petit Chenin” under $10 and frequently a value award winner. Try that wine with some friends or with a snack or a meal, even some background music it goes fine with Mozart, Van Morrison, and Ryan Adams or whatever you happening to be listening to! If you’re at a loss let me know where you are and I will locate your nearest stockist with pleasure and make sure you get to see the value, really it’s hard to beat. Let me know what you think. oh and at some point you do need to get on an airplane and come out here for one of the most memorable trips of your life.
    Kind regards and happy bibbing!

    Ken

  10. Thankyou for the post. Good to be here….! Great Job !!

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