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A call for more transparency in where wine comes from

20 comments

Two things that happened lately have made me think about how the law as its currently written allows wine brands to cloak themselves in absolute secrecy concerning where the stuff in the bottle actually comes from.

Over the weekend I went down to my local Cost Plus, as I sometimes do, to hang out in the wine section and talk to the guy who works there. He was explaining why some bottles are priced at $X.97, where others are $X.98 or $X.99. The .97s are closeouts. The .99s are the regular price (reminded me of when Don Draper said, on Mad Men, “Whoever invented .99 cents was a genius!”), and then there are the .98s. Those are the most interesting category; they’re mainly wines that Cost Plus bought, out there on the open market, then labeled with their own made-up brands.

First off, you’d never know that these are Cost Plus brands unless you asked; each brand has a different name and a different label design (although all the labels are similar enough in style to suggest they were designed by the same hand). Secondly, you’ll never know who actually made the wine, or where the grapes were grown. Take that Napa Valley Cabernet Sauvignon. Was it made by a well-known Napa winery that couldn’t sell it at their usual price because of the Recession? Lots of wineries don’t want to reduce their prices, because if the economy ever rebounds, consumers who are paying $12.99 will resist paying the $40 the wine cost before the Recession. So these wineries will sell off their wines to an outfit like Cost Plus. Sometimes (the clerk told me), the wine is in the bottle. All Cost Plus has to do is remove the old label and put on the new one.

The consumer is often the beneficiary of this, of course, since she stands to get a $40 bottle for $12.99. But wouldn’t it be nice to know who actually made the wine and where precisely it’s from? I think so. But as far as I know, there’s no law, federal or California, that mandates such transparency. There should be.

The other thing that happened was that I got an email press release from a new brand, which I won’t identify because there’s no need to. Suffice it to say it’s a Napa Valley Cabernet Sauvignon. After touting the wine (which I have not had), the press release said, “There are several intriguing mysteries about the wine—one of which is that the winemaker’s name will not be disclosed. In addition, the exact vineyard sources for the Cabernet grapes will not be divulged.”

Well, I emailed the people back and asked why they couldn’t divulge the winemaker or source, and the answer was: confidentiality agreements. Whoever made the wine evidently had a say in whether his or her name could be associated with it. Ditto for whoever owned the grapes.

I can understand why a winemaker or winery would not want it to be known that they’re basically dumping unsellable wine at bargain basement prices. On the other hand, I think consumers have a right to know where their wine comes from and who made it. Maybe most consumers don’t care. All they want is a tasty glass of wine at a good price. But surely, some consumers desire to know this information. I do. Do you?

  1. This is a silly proposal for a few reasons. First, if a vineyard owner wants to sell their grapes or juice to a negociant, that’s their prerogative. If they want to remain anonymous, that’s also their prerogative. The state has no business interfering. Secondly, if a winemaker wants to sell his or her talents to a a producer its also his or her prerogative to remain anonymous should he or she choose. That’s business. That’s free enterprise.

    What’s really at risk here is the myth structure around ANY particular producer, region, or winemaker. $50 Cab producers ROUTINELY sell off bulk juice and you can routinely find off-label or house label wines utilizing this juice in inexpensive products that rival or exceed the $50 wine. Wine tasting is a matter of perception and an appropriate quality product for the particular consumer will win out, regardless of price.

    And it’s not like the wine doesn’t say where it comes from, if it says it’s from Napa Valley it’s from Napa Valley. If it says it’s from Central Coast, it’s from Central Coast. If it says it’s from California, it’s a blend from a number of regions in the state. What you’re taking issue with is that it doesn’t say what branded origin vineyard/winery/winemaker the juice is from, which is one of the more meaningless signifiers of a wine’s value.

    At the same time, you propose to make it impossible for premium wine producers to have control over their brand in situations where they have a surplus of fruit, juice, or wine to sell out on the market. If Silver Oak wants to sell 10,000 cases of Silver Oak to Cost Plus in a surplus year they can do that and if they want to do it secretively to protect their overpriced flagship product they can do that too. The savvy consumer who recognizes both the mediocrity of Silver Oak and the quality of the Cost Plus product will win out. And most savvy consumers already know that for around $20 they can find wines on the open retail market that meet or exceed the quality of all but they world’s most distinctive wines.

    Any consumer who needs validation beyond his or her own palate is not a serious wine drinker.

  2. Lorrie S. LeBeaux says:

    Steve,

    I do want to know all that information. I think maybe that is the difference in a wine drinker and a wine lover. A wine lover wants to know all there is about wine, including origin of grapes, the wine maker, etc. I did a piece on thanking the wine maker on http://www.ebacchus.com So, who would I need to thank in the above situation?

  3. Lorrie, not sure whom you’d thank, but it would be nice to have the info wouldn’t it.

  4. David, your points are all indisputable. All I’m saying is that I personally would like to have that extra knowledge. Maybe it’s because I’m basically a reporter. I want to know who, where, when, what. how, why. I’m not trying to prevent a private business transaction and I realize my proposal is going nowhere. I’m “just sayin”

  5. Personally, I want to know as much about the wine as possible. There have been bottles in the wine shop that I’ve been interested in, but didn’t purchase because I just couldn’t get enough information from the label. The is especially the case with red or white blends that don’t list what varietals are in the bottle.

    However, for the masses, I think you can cross a line of confusion, where there is information overload. I think there is a rough correlation between bottle cost and depth of information.

    I agree with David that wineries must have the ability to quietly dispose of surplus bulk without fear of the receiving winery messing up the bulk, but still marketing it with some attachment to the original producer’s brand. Many bulk wine sales contracts have a stipulation of confidentiality that prohibits the purchaser from mentioning the producer.

  6. There are plenty of wines on the market where it is possible to find out everything you want to know about them: vineyard, grapes, fermentation, aging, bottling, sources of all materials used, analytical results for the wine, grower, grower’s grandmother, winemaker, winemaker’s dog, etc. Pa. Len. Ty. of them. If you value those things, buy those wines – us low-production-volume artisanal producers will thank you for it.

    But please don’t start asking for the same “transparency” from industrial, heavily-commercialized producers and negociants of commoditized wines. David’s analysis was spot-on, so be careful what you wish for. Many if not most small to medium-sized producers are only able to continue to bring you interesting, top quality bottlings because we are able to generate reasonable cash flow by selling down-market our de-classified or excess inventory. If we can’t sell these wines, some small producers will go out of business and you will have fewer choices rather than more.

    Coming at it from a different perspective, Cost Plus (or whoever) got a great price on that wine they re-labeled precisely because it had been scrubbed of the original branding of the grower/producer/winemaker. Those things have a value that is defined by the difference in price between wine carrying my brand and name and the price Cost Plus charges for a lesser wine I chose not to attach our brand identity to.

    Steve – “On the other hand, I think consumers have a right to know where their wine comes from and who made it.” Just because someone wants to know something does not give them a right to know it. That information has value. Producers absolutely have a right to charge for it.

  7. As a consumer, I generally gravitate to wine that have this “transparency”. Its hard to keep up the many brands each winery has, let alone bulk based programs. Look at brands like Castle Rock. They trick you into thinking they actually have a winery, when its just an office in LA. Businesswise, you gotta had it to ‘em.

  8. Steve, “Le négoce” has been a solid business in Europe for centuries and has the critical function of correcting price distortions and providing liquidity to markets and producers.
    For me, what is truly important, instead of knowing who made the wine, is to know how the wine made was made and where the grapes were grown.

  9. Sorry Steve, I can’t disagree more. Being from Vancouver – the most expensive wine market in the world – I love coming to California and going to Trader Joe’s to buy up the many mystery bottles labeled with the Trader Joe brand. A Napa Valley Meritage for ten bucks? Who cares who made the wine when you can get $30 wine for $10? The zin from Pasa Robles and the Mendocino SB were both very ok, but for $5, the committment was minimal. Mystery bottles are good for the producers, good for the retailers and ultimately great for consumers. Why screw up that bargain in the name of information?

  10. What I think we’re seeing is a shift in what we view as the “source” of wine. The winemaker-oriented revolution is a relatively recent one, negociants dominated for a very long time and in many regions still do. Consumers didn’t care about the particular winery or the particular wine maker, because it was the pedigree of the grapes from a particular region or location that mattered.

    I guess the question is, you want to know what you want to know, but WHY do you want to know what you want to know? Knowledge for knowledge’s sake? Perhaps there is more value in not knowing? Maybe in not caring to know we can help strip away the arbitrary distortions that (to me) have been highly damaging to wine production in the last 20 years.

  11. Steve, thanks for responding to my my query on your retasting post. Regarding the transparency of where wine comes from, I was exposed to a similar instance that I blogged about on drinknectar.com (http://ht.ly/1Tp5C) I’d love your thoughts about how the industry can better educate consumers about these juicy little secrets so that vineyard to glass producers are able to capture a bit more of the market share with what some may refer to as more “noble” efforts related to the fruits of their labor!

  12. Steve: You are free to desire what you wish in this type of transparency, but there are many different reasons a producer might offload grapes, bulk wines, shiners, or even already-labeled wines. If they desire to remain anonymous in doing so, I see no problem with that. I view non-disclosures in these situations as not only appropriate, but vital.

    If you’re absolutely set on delving into these specifics, every bottle of wine in the market must have a COLA. The bonded facility applying for the COLA and other information on the application is all a matter of public record and is easily searchable via the TTB. So, in essence, a lot of what you desire to be disclosed already is, but you’re going to need to spend more than 10 seconds looking.

  13. Great point Steve although I agree with David that the information should be given voluntarily.

    Here’s my test: go to the wine’s website. If there is no mention of any person, specific vineyard or any real story about the brand- its not real. Not that its not real wine but its most likely mass produced private label stuff from a giant wine company. If you don’t want to support that then don’t buy it.

    I have experience with Cost Plus and this is where most of their volume comes from, not small Napa producers with extra juice. Cameron Hughes, Costco and Trader Joes are more likely to go that route.

  14. Steve,

    There’s no law preventing wineries from including all of the knowledge in the world on their bottles. If you want all of that info then you’re free to only buy from those sources that include it.

    But those of us who love wine (and trust me Lorrie, we do love it) but simply don’t have the cash to pay the branded prices are thrilled for the chance to find some diamonds in the rough and are more than happy to accept the cost of a little bit of mystery. In some cases it can even add to experience as you try and devine the source.

    -Tim

  15. Morton Leslie says:

    Don Draper would like the “confidentiality agreement” spin on bulk purchase made-up brands which implies the wine is from a source and maker adamant about protecting their stellar reputation. Let the buyer’s imagination do all the work.

  16. Patrick says:

    Steve, I agree with you completely. But what I have a even bigger problem with is the labeling laws. Where a producer can claim Napa, but only 75% of the grapes are from Napa, or single varietal wine when yet again only 75% have to be that particular grape. I don’t even want to get started on the alc%. What bothers me is that most people do not realize this and think the label is true.

  17. Patrick might very well be aware of this, but just to make sure it’s clear: It’s true that a producer can use Napa County on their label with just 75 percent of the grapes coming from Napa County, but to use the Napa Valley AVA the requirement rises to 85 percent.

  18. Steve:

    I can think of a number of reasons a winery or winemaker might not want it revealed they made a particular wine. You already hit on a few good reasons, but brand equity is the primary one.

    Also, I’m not sure consumers have a “right” to know who made a wine or what vineyard it came from. However, they would certainly benefit from it.

  19. Hey Steve- I took the time to comment here the other day and you seemed to have deleted it. Why? Because I disagreed? Now wish I had not twittered it.

  20. Mari: if I deleted it, it was an accident. The only things I delete are spam. Sorry. If you will repost, I’ll get it up asap.

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