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The Wall of Wine, Stories, and Consumer Psychology

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I was on the panel of a wine event last week, and one of my fellow panelists was from one of the nation’s biggest Big Box grocery retailers. I asked him, “Will the infamous Wall of Wine be always with us?” and he answered, “Yes. Retail is here to stay.”

Indeed it is, as a basic function of human interaction: I buy something wholesale and sell it to you retail, for a profit. But as experience shows us, retail changes its external face constantly; and the Big Box, with its Wall of Wine, will not be with us forever—at least, in the form we know it.

The reason things are changing is simple to understand: Millennials.

“Online retailers have a huge edge with Millennials,” according to this 2013 study which took the example of a popular woman’s athletic tank top to illustrate Millennials’ disinclination to buy things in stores. “’I logged on, I found my Under Armour top, I pressed a button and got it 4 days later,’” a representative of the company that sponsored the study air-quoted a hypothetical Millennial on her satisfaction with the online experience. He added, “The younger respondents got, the less physical experience mattered” to them.

Contrast that with the number-one reason Baby Boomers cite for their preference to shop in traditional bricks-and-mortar stores: “instant ownership,” with 79% of them in the study citing that “as the most appealing attribute of any retailer, online or off.” This is why, according to the study, even though Amazon is the world’s biggest online retailer, its earnings in 2012 were only 13% of what Walmart cleared.

Baby Boomers may not have a problem with supermarkets, but it’s clear their children and grandchildren do. But Big Box heavyweights like Safeway aren’t about to roll over and go away. Instead, the study predicts, stores will “integrate the digital with the physical,” acquiring “online characteristics.” Such as? “Expect to see a place to pick up the stuff you bought online,” in a “retail locker” concept of retailing. Imagine buying a couple bottles of wine online from any site, and then—instead of waiting for days for it to be delivered to your house (and you might not even be home when it comes)—it will go straight to the “retail locker,” where it will not only be waiting for you, but will be presented to you “by people who like people,” not the often surly floor staff of supermarkets.

That sounds like a pleasant experience. What are the implications for the Wall of Wine? Not good. If inventory is purchased just-in-time, stores will have no reason to buy thousands of bottles they don’t even know they’ll be able to sell. The Wall of Wine will vanish, for the simple reason it will have outlived its usefulness.

* * *

And then there was the tasting I went to on Sunday at a local wine shop. It was of various coastal California Pinot Noirs. One of them (Porter-Bass 2012) started out smelling very funky, a phenomenon everyone who remarked on the wine noticed. (The funkiness, whatever the cause, blew off after a while.) I didn’t particularly care for it. Our host, however, liked it quite a bit, and explained, in some detail, the winery’s biodynamic approach to grapegrowing. Her preference for this wine was apparent to the guests, most of whom were amateurs with only little knowledge of wine. After she was finished speaking, one of the guests, who had noted the funkiness with what I thought was a critical attitude, said, “I thought it was too funky, until I heard your story. Now, I love it.”

Well, the top of my little head exploded at that. You know that we’ve been talking about “stories” quite a bit here at steveheimoff.com. Stories are the new black of marketing: the latest, hottest trend in the industry. Until my experience at that tasting, I had not perhaps appreciated the power of a good story, told by a trusted authority figure, to completely change the thinking of someone else. And not just to change their thinking: to actually change the way something smells and tastes to them!

I am in awe. Have to think more about this one. The host’s story didn’t work on me, but I’m not your typical wine consumer. Are average wine drinkers so unsure of their own perceptions that a testimonial from an expert can redirect them? Or does a good story, told passionately by a believer, somehow open up the mind of a skeptic so that he can perceive reality on a higher plane? If the latter is true, then what about a good story told passionately by someone who doesn’t even believe it, but is telling it only in order to sell a wine?

I don’t know the answers. There may be none. There may be different answers for different people. But I think all of us had better bone up on our story-telling abilities.


Emotion, the Bee Gees and Bill Harlan: The power of persuasion

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“It’s just emotion that’s taking me over,” the Bee Gees crooned—emotionally—on their 1978 hit, “Emotion,” a song of unrequited love and the pain it can cause.

We all know how powerful emotions can be. If strong enough, they can, and do, overrule reason and common sense, and “take over,” driving their human to perform irrational and sometimes even self-destructive acts. But emotion also can inspire people to supreme creative heights: Beethoven’s deep depressions turn up in his Third Symphony, the Eroica, which is steeped in grief. But his Ninth, the Choral, is an explosion of the most ecstatic joy. (The suggestion that Beethoven was bipolar seems retrospectively to make sense.)

Emotion plays a role in our experience of wine, too. A recent Australian study suggests that people are influenced by emotions spanning the gamut from warm-heartedness and nostalgia to anger, even when they’re tasting wines blind. It’s not clear to me that this particular study is of any use to winemakers, beyond being a fairly interesting academic exercise. Far more insightful is this blog post from Clinton Stark on his responses to receiving an offer to buy Promontory, a new project from Bill Harlan. (I myself haven’t tasted it, but two years ago Bill Harlan explained the project to me, and I subsequently wrote about it in Wine Enthusiast.)

Clinton’s appraisal is that the appeal of Promontory, a $400 Bordeaux blend, is pretty much exactly the same as that of “rarified, non-discretionary luxury goods,” like “a purse, a painting, a sculpture,” or, more specifically, “a Porsche.” All trigger “feelings” of “inexplicable and illogical lust,” the result of “marketing” pitches (in his case, Promontory’s offer letter) that cause “woefully uncontrollable…desire” in Clinton’s all-too-human heart.

Clinton has had, in other words, an emotional response to the offer letter. Even though he knows that Promontory is just another red wine, albeit (one imagines) a very good one (after all, Petrus and Romanée-Conti are also “just” red wines), some part of himself—which he knows is irrational—wants it. He has a good attitude about the whole thing, though: recognizes his emotional response, views it with the correct admixture of detachment and wry amusement, and decides ultimately not to buy the wine, but to add the offer letter “to my collection.”

Are we to conclude, then, that the producers of expensive wine merely resort to marketing ploys that prey on our emotional triggers? Were things only that simple! Humans are too complicated to divide desire into two categories: desire based on real need, and desire not based on real need, with the latter category somehow illegitimate or silly. We do have emotions; our emotions help to define our humanness. (And I’m not saying that animals don’t have emotions. As Gus’s dad, I see the full rainbow spectrum of his.) Part of desire is aspirational: the person who loses, or voluntarily denounces, his aspirations may be a Mother Theresa type, but as Plato knew, self-interest lurks everywhere, in our saints as well as in our sinners; who is without aspiration of some kind is dead. The desire for something fine and rare—a wine, a Philip Milic tattoo, a Lamborghini, a Ty Cobb baseball card, an Oscar, a Superman Action Comic No. 1, a trip to outer space on Virgin Galactic, a Papal blessing—may be irrational, in the sense that it is not strictly to sustain life. But neither are love and much of what makes life so rich and interesting.

And then, even as I wrote this blog post, the phone rang and who should it be but Bill Harlan. Serendipity, you dazzle me! This was of course before he could have known about my next day’s post. He called about something else. We talked about Promontory, and I told him it  would be in the next day’s post. I said also how much I’ve always respected him personally as well as his wine businesses. None of what I have written above is meant in the slightest degree to disparage him, or whoever wrote his offer letter. I don’t think that was Clinton Stark’s point and it certainly isn’t mine! A large part of Bill’s genius is in dreammaking. Let he who is without the sin of self-aggrandizement cast the first stone. I’m just saying that at some point, wine doesn’t get any better no matter how high the price soars. What the buyer is looking for can’t be measured or expressed or even justified: it’s “just emotion,” and sometimes it can feel so good to let it take over.

Have a safe and happy Labor Day weekend! Back on Tuesday. (And aren’t you glad the Seventies are over!)

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Print down, but not out, yet

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Observers of this nation’s media environment might be forgiven for being slightly manic-depressive. One day, everyone’s convinced print publications are headed for the trash heap; and the only question seems to be, How fast will this happen?

The next day, having imbibed the bracing tonic of some academic study or other, we remain confident print isn’t going anywhere. We hear that more Millennials are subscribing to magazines; that advertising is returning to print, having previously abandoned it during the Great Recession; that even young people are tiring of their obsession with (and enslavement to) mobile devices.

I, myself, have been consistent over the years in my position—which is not to say I’ve been correct, just that I’ve been saying the same thing all along. And that is in line with the “print isn’t going anywhere” theory. It has seemed to me that print publications are in a strong position to not just survive but thrive going forward, although I may be prejudiced, in terms of both my age (I grew up on newspapers and magazines) and my past career as a print guy.

Given the obscurity of the situation, no one really knows what’s going to happen to the nation’s newspapers and magazines. Which is why we so eagerly grasp every new study or factoid that comes along, hoping (perhaps against hope) that it will accord us some tidbit of understanding. The latest information comes via the Wall Street Journal, which last week reported that “Print Magazine Sales Decline in 1st Half of 2014,” a situation that must depress print fans. For the data—down 12% in newsstand sales compared to the 1st half of 2013—are especially troubling, since “Newsstand, or single-copy, sales have been considered the best gauge of consumer demand because they can’t be propped up by deeply discounted subscriptions or free copies distributed in public places such as doctor’s offices.”

(This last sentence strikes home. The discounts I’ve been offered to the magazines I subscribe to make me wonder how those magazines can stay in business at those prices; meanwhile, the three publications I see given away free, in almost all the hotels I stay at in California wine country, are the Wall Street Journal, USA Today, and Wine Spectator.)

Well, that’s print magazines. And what of digital? Up from 10.2 million last year to 11.6 million this year, a rise of 13.4 percent. But there’s this catch: “However, the category [digital] accounts for just 3.8% of the industry’s circulation,” a very small slice, and thus not particularly reassuring to financially-pressed publishers.

THE META-TAKE

Does any of this matter, except to publishers and their bank accounts? It does, if you think of a nation’s wine consumers as part of a community, in which group decisions are made, after a give-and-take (this is, after all, how wine trends become ensconced into traditions; for example, the rise of California Cabernet Sauvignon was a group decision, driven largely by the power of the media).

If you don’t care about group decision-making, then the dissolution of the media won’t bother you. After all (you may reason), a group that was based around print will simply cluster into a group based upon digital. Yes, but…If that happens, there will be, not one group, but many; not a single conversation (such as has always existed) but multiple ones. And when you have multiple conversations, each driven by its most vocal adherents, but none of which really touches upon the others, you have chaos, whether it’s in domestic affairs or in something as relatively calm as the wine industry.

All this drives wine marketers bonkers. They try to come up with messages that appeal to all groups, and realize how difficult that can be. The broader the message, the less refined it is; the more refined, the less broad; but this, at least, keeps marketing people employed.

Is this then the cloud, or the silver lining around it? I’m an eternal optimist. The marketing of wine is more fractionated than it has ever been, but this simply means that wineries have to work smarter, in order to succeed. Part of working smarter is producing better wine. Part of producing better wine means having your finger on the market’s pulse, and divining where the public is going. This, in turn, requires knowing how to tell the difference between a trend that is going nowhere, and an authentic shift in public preference. No easy task.


Do Millennials find wine “dull”? Let’s talk

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Once a headline is out there, it becomes “reality”—whether it’s based on reality or not. Thus, “Millennials: Wine Dull, Cocktails and Beer Exciting”, which is the header of this online article, is repeated on Lewis Perdue’s Daily News Fetch, so that people who don’t have time to actually research the topic—which is most of us—go away with the impression that Millennials are turning away from wine (if, in fact, they ever embraced it) in favor of the latest signature cocktail or craft suds.

The “dull wine” meme comes from this story in Wines & Vines, which based its own headline, “Wine Losing On-Premise Sales,” largely on the remarks of an MW who is the beverage director of a large restaurant chain, who said, “Cocktails and draft beer are more entertaining to [Millennials] than wine.” In a key quote concerning his own beliefs, the MW inplied that, for younger drinkers, beer and cocktails “feed the souls,” while wine presumably doesn’t, since it is not associated with the visual feast of “attractive, muscled bartenders with tattoos shaking cocktails like maracas and blenders whirling.”

Wow. I’ve seen plenty of muscled winemakers with tattoos, but it’s true that they’re not on public display the way mixologists are (and maybe they should be). Still, as much as I doubt the entire truth of the premise that Millennials are turning a cold shoulder to wine, there is in my own life some evidence of it. I have friends in their 20s and early 30s who really don’t care much about wine, but they do love a good glass of beer and if they’re in full party-on mode (which they frequently are late at night) it’s hard liquor they turn to. It’s always dangerous to base one’s conclusions on anecdotal evidence, but there’s little doubt that there are folks out there in their 20s and 30s who for whatever reason don’t perceive wine to be as cool as a local mini-brew with a badass label, or a glass of something hard with all kinds of fruits and colors swirling around.

Still, I come down on the side of Sara Schneider, the wine editor at Sunset, who was quoted in the Wines & Vines article as saying she doesn’t agree with the MW. Calling wine “almost de riguer in new restaurants,” she pointed also to the proliferation of wine bars as proof that Millennials, and drinkers of all age, remain dedicated fans of the grape. And then there was the floor manager I met yesterday from BJ’s Restaurant and Brewhouse. I asked him if his young customers think wine is dull and he said, in essence, hell, no. So once again this confusion underlies the fact that the market is incredibly complex; there’s no such thing as “Millennials”, there are individual millennials, and divining what they like and don’t like is an inexact science.

So it may or may not be true that Millennials see wine as dull; there are studies, and then there are studies, and you can generally find anything you want to with a Google search. Be that as it may, there are clues in this little debate concerning what wineries should be doing, from a marketing point of view, in order to remain competitive with beer and booze. If my experience is any indication, and I think it is, they have to get out there any and every way they can: on social media, on wine lists, at meet-and-greets, pouring in hotel lobbies and hosting events and in general hitting the road. The market is wide open right now for wineries to make fast, smart moves, by-passing traditional gatekeepers (who tend to be the most conservative people on earth) and plowing new ground. A winery that believes it’s been shut out of a particular market, such as Millennials, will be, because we make our own reality.


A wine lunch at Michael Mina

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We had a fantastic lunch at Michael Mina yesterday (don’t even get me started on the short ribs!). It was my first sales trip (for Jackson Family Wines), to which they had invited a small bunch of top sommeliers in the Bay Area. The wines were no slouches: Matanzas Creek 2012 Bennett Valley Sauvignon Blanc (awesome with the hamachi sushi), Stonestreet 2011 Broken Road Chardonnay (so crisp and lemony-minerally), 2006, 2007, 2009 and 2010 Cardinale and 2007 and 2009 Verite La Muse. Two of those wines (2006 Cardinale and 2007 Verite) were among the only five wines I ever gave perfect 100s to during all my years at Wine Enthusiast, so it was pretty special to taste them again. The ’06 Cardinale of course had more bottle age than it did when I reviewed it (in 2009, I think it was), and it was just about as beautiful as Napa-Bordeaux wine gets. OMG I wouldn’t mind having a few cases of that! The 2010 being younger was more tannic, and if it didn’t have the sheer dazzle of the ’06 it had plenty of elegance. As the late, great Harry Waugh would say, it will make a great bottle.

As for the Verities, what can I say. That Alexander Mountain Estate (where the grapes come from) is one of the world’s great vineyards and if you think I’m saying that just because I work for JFW you don’t know me or the estate. Somebody said that Verite wines have had ten 100s (one from me, nine from Parker), more than any other California wine. I don’t know that for an absolute fact, but there’s no question that Pierre Seillan is doing amazing things up there on that mountain. (By the way, this led to a little conversation about whether Bordeaux blends are better from a single vineyard or a blend. Unlike Verite, Cardinale is a blend: the 2006 was from Mount Veeder, Howell Mountain, To Kalon, Stags Leap, Spring Mountain and St. Helena, but, as I said, it was absolutely a 100-point wine. So, no, a great Bordeaux blend can be a blend OR a single-vineyard wine. And there’s no reason in principle why a great Pinot Noir can’t be a blend, if you think about it.)

I so enjoyed being with those smart, young somms. They ask the best questions. One in particular, Ian Burrows, from Atelier Crenn, in the Marina, really hit me up with some great ones. Why do I give high scores to some varieties (Cabernet Sauvignon, Pinot Noir) and not to others? I explained that, since I reviewed only California wines, although I might like, say, a Pey-Marin Riesling, I’m not about to give it 100 points, or a Charbono from Summers or a Gruner from Von Strasser, much as I like those wines. He pressed me, which was delightful, because it makes me think more deeply about stuff than if I’m just thinking off the top of my head. To be interrogated like that—not in a mean, threatening, third-degree way, but in a journalistic, curious way—is very good. It makes you justify your thoughts and actions and think about things you might not have fully thought out before.

The somms asked lots of questions about being a wine critic and scoring and how do you taste and so forth, and at one point—we were talking about blind tasting—I found myself saying something I’d never said before, at least, with such conviction. “Wine critics really should be held to higher standards of accountability,” I said. There is so much we don’t know about how they taste and review wines. I added, “With all the immense power they have in the marketplace, they should be far more transparent.” I believe that. When I was a critic, I tried, through my blog, to offer more openness and transparency about the actual process than any other critic I knew of (and I think I did a good job). I also was open about my own internal doubts. “Do you ever doubt yourself when reviewing?” Ian asked. “Yes!” I told him. You can’t not doubt yourself. Pride goeth before a fall. Of course, you need to be confident in your abilities, but you also must never forget that you are human and thus fallible. (If you do, experience has away of humbling you, as for instance when you call a Petite Sirah “Merlot” in front of a crowd.) You also must not forget that, if you’re a critic, you’re playing with people’s lives–I mean, the people from the winery whose livelihood you may jeopardize with a poor score. Believe me, that is a very sobering thought.


Why do people buy wine?

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There’s a million reasons, of course, but one that’s interested me for years is why they’re willing to pay a premium for some wines and not for others. And in some cases, a huge premium.

The plain and simple fact is that a $1,000 wine isn’t ten times better than a $100 wine or 20 times better than a $50 wine. In fact, you could make a strong argument (which I guess I’m making now) that, once you get above a certain price, there’s less and less difference between wines. That $500 bottle of Napa Valley Cabernet Sauvignon isn’t necessarily better than a $50 Napa Cab.

We have to define what “better” means, though, before we can proceed. By “better” I mean the wine’s hedonistic or organoleptic or purely sensory qualities: the flavors, the way it feels in the mouth, the finish. In a great winemaking region such as Napa Valley, where the overall quality is as high as anywhere on earth, the consumer can rightfully expect a certain standard of excellence once the wine gets to, say, $40. This is why you can make a blind tasting and often a more modestly priced Cab will win.

Which returns us to the question: If the $500 Cab and the $50 Cab are so alike in objective quality, then why would anyone in their right mind buy the former?

Well, you have divined the answer, haven’t you, dear reader? It’s because, when it comes to paying these astronomical prices, there’s nothing objective whatever going on in the buyer’s mind. It’s all subjectivity.

How does this subjectivity work? We get a hint of the mechanism by reading this description of a tasting set up by a crafty Frenchman, Frédéric Brochet, who fooled a bunch of so-called connossieurs. “[He] decanted the same ordinary bordeaux into a bottle with a budget label and one with that of a grand cru. When the connoisseurs tasted the ‘grand cru’ they rhapsodised its excellence while decrying the ‘table’ version as flat.”

If you’re a regular reader of this blog, and of wine news in general, you’ve no doubt heard enough of these kinds of experiments to know that they demonstrate the point I’m trying to make: Your experience of the wine all depends on what you think you’re drinking.

My goal today, though, isn’t to reiterate this point, but to try and rehabilitate the reputations of people who routinely get fooled in these tastings, and to show that they’re not total idiots, and you shouldn’t condemn them as such. Instead, their very failure to perceive reality illustrates one of the best reasons to drink fine wine: because it satisfies, not just the senses, but the intellect.

When I taste Lafite Rothschild, for example, and I know what it is (nobody tastes Lafite blind), I have to admit my soul lights up. I get excited. I pay very careful attention, because this is, after all, Lafite. I know the back-story: First Growth of Bordeaux. Ancient history. One of the greatest red wines in the world. Thomas friggin’ Jefferson loved it. My reaction similarly would be the same as, say, being given the Koh-i-Noor diamond, as opposed to costume jewelry. If you gave me the Koh-i-Noor (you’d have to wrestle it away from Queen Elizabeth first), you just know I’d stare at it and bring it up to the light and look through it and ogle it and go ooh and ahh and remember that moment forever. Now, on my own, I’m sure I couldn’t tell the difference between the Koh-i-Noor and a cubic zirconium from QVC, but that’s precisely the point: in our little thought experiment, I do know the difference. And that makes all the difference.

This subjectivity explains why wines of equal or almost equal quality may vary so widely in price. The pleasure of drinking Lafite consists of far more than merely what the wine tastes like. This is something that’s hard for outsiders to understand, but which is easy for a wine geek. To think that you’re in a limited circle of people privileged to taste something as exclusive and expensive as Lafite boosts your love and appreciation of the wine. This may sound snobbish to some people, but it’s perfectly understandable. It’s occurring in the brain, the seat of thinking and understanding; and pleasuring that part of the cerebral cortex is as important as pleasuring the senses, maybe even more so.

So I’m arguing for some understanding for these poor schlemiels who get caught in these wine tasting entrapments. It could happen to you, it could happen to me, and in fact, it has. What it says about wine isn’t that it cheapens the experience or levels the playing field, but that it elevates wine tasting to a fine art whose appreciation requires knowledge and understanding. As the physicist/mathematician, Freeman Dyson, observed, “Mind and intelligence are woven into the fabric of our universe in a way that altogether surpasses our understanding.” What we think is, for each of us, reality; it’s our collective thinking that elevates Lafite to Grand Cru-ness.


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