It’s hardly surprising that “Profitability is the top concern this year for wine industry professionals,” as was reported yesterday.
Dr. Robert Smiley, at U.C. Davis, did a survey of managers and found that “profit margins ranked the most significant wine business trend, garnering virtually a 4 on a five-point scale.”
Any wine company always wants to make a profit at the end of the day, but in these perilous economic times, making a profit–however marginal–can spell the difference between survival and going belly up. I talk to a lot of winemakers, winery owners and winery business managers, and I can tell you that, when they’re being frank (which they aren’t always), and they know we’re off the record, they confess in the most startling terms how tough things are out there.
Just the other day, somebody (an unusually well informed winemaker consultant) told me that one third of the wineries in Sonoma County are up for sale. This is an astounding number. Even if its somewhat exaggerated, it’s probably close to the truth. Imagine being at the helm of a small or medium sized family winery. You’ve always managed to make enough money to keep a few of your relatives employed and live the lifestyle. But these days, the pressure on prices is so strongly in a negative direction that you lie awake at night, worrying how you’re going to get through the next quarter.
That’s why “profit margins” are more important these days than ever. This also explains the next most significant concerns by owners, as reported by Smiley: cost of materials, “pricing pandemonium,” distribution and “new consumer values and how to work with them.”
About “cost of materials,” one of the most significant is fuel, and there’s not much a proprietor can do about that. “Pricing pandemonium” refers to the inexorable demand, on the part of buyers, to pay less and less for wine. Producers would love to raise prices to gain a little breathing space, but they just can’t. I’ve heard stories of buyers getting competing sellers together in the same room and saying, in effect, “Okay, guys, who can undercut whom the worst?” It’s like feeding slaves to the lions at the Roman Coliseum. And that’s assuming that the salesmen can get their product into the distribution system, which is far from the case.
This explains “new consumer values and how to work with them.” It’s not clear from the reporting just what these “new consumer values” are, but we can assume that proprietors are thinking of two things: “values” in the monetary sense of the word (i.e. consumers are looking for value wines) and “values” in the sense of a new generation of younger consumers, who are alleged to think and behave differently from their parents and grandparents.
It’s likely, if you’re a 50- or 60-something proprietor or top level manager, that you look at the younger generation with bemusement. Everything you hear and intuitively feel tells you they’re different. They tweet and Facebook and text; they don’t listen to traditional influencers; they’re much more tuned into peer persuasion than your generation; they want to be engaged by wineries, not manipulated by them, or taken for granted. This makes older proprietors scratch their heads, and look to anyone who can possibly explain to them how to get through to this population. That’s why the upcoming (Sept. 19-20) Wine Industry Financial Symposium will address this topic. Attendees will flock to breakout sessions like Jayson Woodbridge’s “Forget Marketing-Change the Game” and John Gillespie’s “What’s Next for the Wine Market? Reading the Tea Leaves of Research,” where they will carefully inspect every utterance and dissect every statistic with the diligence of ancient soothsayers analyzing the entrails of a slain beast for clues and prophesies. They will take notes, ask questions, network, and then go home, there to resume the fight to make a profit, keep costs under control, get distributed and, if they’re lucky, make a little progress on direct-to-consumer. They’ll probably be just as frustrated about those pesky “new consumer values” as they were going in, but maybe they’ll leave with a few new ideas. And believe me, in these times, new ideas–hope–is what gets you through the night.
Had a call from a friend, Larry Schaffer, proprietor of Tercero Wines, in Santa Barbara. He wanted to know if I could come to an event next month in San Francisco, a promotional thing between the Rhone Rangers (on whose board Larry sits) and The GAVI Alliance, an international nonprofit that combats pneumonia in children. GAVI’s supporters include U.N. Secretary-General Ban Ki-moon and the Bill & Melinda Gates Foundation.
Larry explained that each Rhone Ranger member winery had decided to donate $10 for each case of Syrah sold during November to GAVI. He was looking for help promoting the event.
As it turned out, I couldn’t go. But I was curious as to how and why the partnership between the Rhone Rangers and GAVI had come about. Larry explained that, last June, Eric Asimov had written a piece on his New York Times blog, at The Pour, that was super critical of California Syrah. Eric had repeated the tired old joke (which I’ve now heard about 25 times), “What’s the difference between a case of Syrah and a case of pneumonia? You can get rid of the pneumonia.” He said some rather harsh things about California Syrah (“dreadfully generic”) that I don’t agree with–that’s not the point–but it was a kick in the groin for California Syrah producers, who are struggling.
Shortly after Eric’s piece, a doctor named Orin Levine wrote a piece on the Huffington Post in which he said that, after reading The Pour, he’d had an idea: In recognition of World Pneumonia Day 2010, “I am asking all winemakers and wine retailers to contribute $10 from every case of Syrah they sell in November to the GAVI Alliance, and asking American wine drinkers to make Syrah their wine of choice in November.” Levine seems to have clout. The Rhone Rangers heard about his challenge, one thing led to another, and ergo, the event in San Francisco next month. Even Stephen Tanzer jumped in, following a Rhone Rangers-GAVI tasting in New York, and urged consumers to support the effort, under his cleverly named blog posting, “Pneumonia’s Last Syrah.”
Larry Schaffer was frank in his talk with me in conceding that the Rhone Rangers’ reason for working with GAVI is as much to gain publicity for California Syrah as it is to help kids with pneumonia. Last week, I went to the big Mondavi family dinner, held in conjunction with Morton’s The Steakhouse, to benefit the Make-A-Wish Foundation. It was clear to me then that the various Mondavi brands involved were happy to be helping kids out, but were also happy to see their names connected, in a positive way, with concepts of helpfulness, compassion, love and sharing.
My cynical gene kicks in here. How much of a winery’s motivation is due to the desire for publicity, and how much is true concern for the charity? Is there in fact a difference? It’s impossible to know for sure, since I’m not a mind reader; but in the case of wineries and charities, the question actually is irrelevant. It doesn’t matter what the winery’s real motive is. What matters is how much money the winery is able to help these charities deliver. In the end, these are win-win situations, good for everybody involved. In the case of California Syrah and the Rhone Rangers, I’m happy to pass the message along: during the month of November, if you find yourself needing a red wine, consider buying a California Syrah, and especially one by a Rhone Rangers member. There are dozens of great ones, from up and down and across the state. And memo to Eric Asimov: you were being a little harsh on California Syrah. Lighten up. Don’t shop for the quote that trashes. Give equal treatment for defenders, of whom I am one.
The winery organizations of Paso Robles and San Luis Obispo County last night held a promotional dinner in San Francisco, the first time the organizations had collaborated, in a move that could mark a new era of increasing cooperation between such entities.
The dinner, at Spruce, was hosted jointly by the Paso Robles Wine County Alliance and the San Luis Obispo Vintners Association. Both have in the past “done their own thing,” so to speak, although the former has, in my experience, been much busier in hosting consumer events, while the latter — SLO County — has been a bit reticent.
It seemed to me there must have been a reason why the two organizations finally decided to get together — and it’s pretty obvious what the reason was and is: the economy, and the dour state of the wine industry. Tensions between rival wine regional organizations are nothing new, of course. Look at the skirmishes over Sonoma County’s new conjunctive labeling law, which is likely to be signed into law by the Governor any day now. (I blogged about it last month.)
I think in the case of Paso Robles and SLO County, Paso did such a good job establishing its reputation over the last ten years that they must have thought there was little to be gained, and perhaps much to be diluted, by conjoining themselves and their reputation to that of the county as a whole. And for that, you have to credit the P.R.W.C.A. and its skilled leadership, not to mention the vintners of Paso Robles. They’ve done a really tremendous job.
As for SLO County itself, my hunch is that they felt they didn’t really need to market themselves. Instead, they seemed to let their appellations — Edna Valley and Arroyo Grande Valley — and the fine wineries within them speak for themselves. SLO County placed its bet, as it were, on being a cool climate wine region, and it may be that they wanted to distance themselves from Paso Robles, which is perceived as hot.
But those calculations were thrown overboard when the economic climate turned sour. I don’t know who approached whom, in this case — who did the wooing and who was the wooed. I don’t know if any of the member wineries on either side said, Wait a minute, this isn’t really that good a deal for us. Certainly last night, all was happiness between the representatives of the two regions.
The bottom line is that everybody has to work together to get us through this mess. I know there’s always going to be some residual tension between regional organizations, especially those that are contiguous or nearly so, or in the same county. There’s rivalry between Napa and Sonoma, even between Rutherford and Oakville. But it’s a healthy rivalry, like the Red Sox and the Yankees — good for both teams, good for baseball.
The one thing I wonder about, in the case of SLO County, is whether the idea of an entire county marketing itself makes sense anymore. Counties are so big. They contain multitudes of terroirs. In every winegrowing county there are many rooms, each different, which makes it harder for a county to present a coherent message about its wines. In SLO’s case, aside from Paso Robles, they do have the Arroyo Grande and Edna valleys, which are utterly distinct places, within themselves and compared to each other. When you promote SLO County, does that tend to diminish Arroyo Grande and Edna? If SLO’s reputation rises, will wineries within Arroyo Grande and Edna be tempted to put SLO on the label, instead of their smaller valleys? Will we see conjunctive labeling come to SLO the way it did to Sonoma?
This all signifies that California’s appellations and the system in which they operate are undergoing profound changes. Regional leaders are rethinking their approach to almost everything related to marketing and P.R. In an economy as tough as this, they’ve got to pull every rabbit out of every hat they possibly can. There will be mistakes made, but I think it’s a good thing that the regional associations are showing greater signs of cooperation than in the past, and I applaud Paso Robles and SLO County for taking this step.
Here in California, Pinot Noir has one (World of Pinot Noir). Zinfandel has one (ZAP). The Rhône varieties have one (Hospice du Rhône). Sauvignon Blanc has one (International Symposium on Sauvignon Blanc). Petite Sirah has one (Petite Sirah Symposium). Maybe other varieties do too. I don’t think Cabernet Sauvignon does, but then, can you imagine a Cabernet Symposium? Too politically bizarre to contemplate.
Anyhow, now Chardonnay — America’s favorite white wine — is about to have its very own public event. The Chardonnay Symposium. About time.
What took so long? “We went through this ABC [anything but Chardonnay] period. Chardonnay people were looking at Pinot Gris, Pinot Blanc, Sauvignon Blanc,” i.e. almost anything other than Chardonnay, says one of the Symposium’s sponsors, Nicholas Miller, of Bien Nacido Vineyard. But “a renewed interest in Chardonnay,” he adds, prompted him and his colleagues to start the symposium now.
The one-day event is slated for Sat. July 31, in the Santa Maria Valley of Santa Barbara County, with tastings, seminars, food pairings and of course a great big lunch. The various venues are at Bien Nacido, Cambria Winery, Byron Winery and Tres Hermanas Winery.
I would have loved to go, and they invited me, but alas, something more important conflicts with the date: our annual Summer Editorial Meeting at Wine Enthusiast. If it weren’t for that, I’d be high-tailing it south to hear such esteemed Chardonnay producers as the Symposium will present. Not to single out or exclude anyone, but they include people with last names such as Pisoni, Ullom, Hyde, Talley, Volk, Sanford, Tolmach and Clendenen.
Chardonnay is my favorite California white wine (excluding sparking) and it’s about time somebody devoted a big event to it. True, the geographic focus is mainly the Central Coast, with most of the speakers and participating wineries hailing from there; but then, this is the event’s first year, and you have to start someplace. When World of Pinot Noir began, what– 10 years ago? — I was there (Wine Enthusiast has been a sponsor from day one), and it was almost totally a Central Coast affair. The organizers tried to reach out to the North Coast, but it was hard. Wineries have so many opportunities to participate in so many events that they have to be selective. You not only have to pay to play, you have to open a lot of expensive bottles. And then there are travel and lodging costs, not to mention time away from your real job in the winery. It took some years for WOPN to attract a critical mass of North Coast wineries, not to mention vintners from overseas. Now, WOPN is a huge success.
Nicholas Miller envisions similar growth for the Chardonnay Symposium. “My hope is that, as people see what we’re doing, it will become like a Hospice du Rhône or a WOPN. They’ll see the success of it in future years, and we’ll get more interest from the North Coast.” So [this is Steve to North Coast producers]: keep your eyes on this one.
One tactical drawback I can see for the Chardonnay Symposium is that there’s a near total absence of nice places to stay in the Santa Maria Valley. At WOPN, most people stay at The Cliffs or at nearby resorts. It’s all very convenient. You never have to drive anywhere for the entire three days, and it’s nice to be able to duck away from a grand tasting or inbetween seminars and go to your room to freshen up or rest. By contrast, guests at the Chardonnay Symposium will be on the road all day, at the mercy of shuttle buses. They’ll also be mostly outdoors, which is always risky. It won’t rain at that time of the year, of course, but it could be cold and foggy. Or there could be a heat wave. It’s summer along the California coast; you never know. But then, the Chardonnay Symposium is beginning only as a one-day event.
Here’s what I hope some of the panels focus on.
– the role of oak. How much is too much? Can we wean the public away from their addiction to thick, clumsy oak, which they often think is the actual smell and taste of Chardonnay?
– malolactic fermentation. When is it justified? Are California vintners moving away from it? Why did they become so reliant on it to begin with?
– unoaked Chardonnay. Need it always be only a simple, inexpensive wine? Is it possible to craft an unoaked Chardonnay of great nuance and style?
I’m sure there are lots of other issues, but those are three good ones to address.
You’ll find information on the Chardonnay Symposium here.
Eric Asimov and Karen MacNeil had a panel on “Sensory Analysis vs. Wine Reviews” in which Eric reprised an earlier topic about “the tyranny of the tasting note.” He calls tasting notes “pernicious” because it makes wine seem “unambiguous,” which it isn’t, and “rips the heart of out its mystery.” Well, yes…and no. Yes, because it’s awfully hard to summarize the experience of a wine in words. No, because if you’re reviewing a wine, you have to say something, so all you can do is your best. That is, after all, what writing is all about: doing your best.
Eric is right on about the laundry lists of descriptors many critics use. It’s too often pretentious, precious and downright silly, all those olalaberries and grilled asphalt and so on. I myself have vastly simplified my metaphors over the years, and moved more toward writing about balance, structure and elegance (or the lack thereof). My problem with some young bloggers is that they’re going back to the use of obscure fruits, flowers etc. Maybe they have to; maybe that’s something the novice wine writer has to do.
Earlier, my old colleague Jeff Morgan had a panel called “What wine writers need to know about wine” that was particularly welcome, I’m sure, by all us writers. There’s been much discussion, including here on my blog, about how much technical knowledge a wine writer should have. A little? A lot? Obviously, some knowledge is desirable, but I’ve always thought a lot is unnecessary and can even be a hindrance. A move critic doesn’t need to know all about digital film technology or lighting manufacturers or Dolby sound. If technical knowledge made for a better wine critic, the best of them would be viticulture and enology professors — which is patently not the case.
Jeff raised the question of watering back wines or musts to combat high alcohol — which he said 80% of Napa vintners routinely do. He said although this actually improves the wines, the winemakers are loathe to admit to writers that they do it. “It’s because some powerful columnists lambast anything they perceive as interventionist, and the public buys into that,” I said. Jeff, or course, agreed. I personally am not bothered by so-called “interventions” to make better wine. Everything about winemaking is interventionist. It’s a bogus controversy ginned up by some writers who don’t actually have to make wine themselves. If a winemaker waters down, or acidulates, or sulfurs, or uses R.O. — whatever — who cares, as long as the wine is good? So next time you read a critic ranting about “intervention,” understand he’s just looking to pick a fight.
Later that day, we did a blind tasting of 5 Napa reds with Ms. MacNeil and I completely wiped out. We all did. I don’t necessarily feel bad abut guessing Barbera when the wine was an old field blend, and so on. The important thing in these useful exercises is for your logic, your deductive process to be correct. I understand that in the M.W. tests they don’t care if you guess the wine correctly, they want to know that your reasoning was accurate.
In the evening Bill Harlan hosted a few of us for drinks, and then it was on to the Restaurant at Meadowood. The food was obviously great but for me the highlight was sitting (and drinking) with Eric Asimov and Alder Yarrow, both of whom I got to know much better than ever. Such smart guys, so savvy and brilliant in their own unique ways. Easy to see why they’re both where they are in their blog careers. We had what easily was the greatest conversation about blogging, social media and where it’s all going that I’ve ever had. (And I was so pleased to discover that Eric and I share a martial arts education.) Now, this morning, it’s on to the two big panels, Alder’s on Monetizing your new media writing (which I’m on) and mine on Wine writers, ethics and income streams. This is going to be hot stuff. I’ll report tomorrow.
Back in the ‘90s they called them DINKs: double income, no kids. They were primarily gay men, and they were perhaps the most highly sought-after demographic, because they had a lot of cash to spend — including on wine.
They’re still dependable spenders. And now, one of the biggest and most formidable amateur wine groups in California, Magnum Men’s Wine Tasting Group, is comprised primarily of gay men. It has about 400 members, and is run out of the Healdsburg home of retired tech exec Bill Carney and his partner, Scott Monroe, who does hospitality at Gary Farrell winery.
The group meets once a month from Spring until Winter, at gay-friendly wineries. “We’ll pick a varietal, and then people bring along [bottles of] what’s designated,” Carney says. The group tastes the wines blind; attendees fill out scoring sheets, and a winner is declared at the end of the evening. There’s usually a potluck dinner. “It’s really a fun thing,” Carney notes, adding, “and it’s also an opportunity for the host winery to showcase their wine to a community that in many cases has discretionary income. They can talk about their wine, put one in the mix, do sales, club sign-ups, and so on.”
Recent or upcoming wineries that have hosted Magnum events include Passalaqua, Sbragia, Seghesio, Gary Farrell, Clos du Bois, Raymond Burr, Wilson, Mazzocco and Ridge.
The group began informally about 5 years ago when some gay men in the wine industry decided to get together as a social thing. “Then it started to snowball,” Carney recalls. “People heard about it and wanted to know when the next one was. So Scott and I decided to turn it into a network and institutionalize it.”
Carney says he posted results of the tastings on the e-Parker blog and also on Wine Spectator’s, but ran into some not-so-subtle homophobia on the latter. “Unfortunately, on Wine Spectator, it turned into a hate blog. ‘Who wants to join a bunch of fags?’ People were really rude. It turned into a really ugly situation. I stopped posting because it got so unpleasant.” Carney is quick to point out that the Wine Spectator moderator did not quash his posts. “Privately, he emailed me saying he thought we were great. But some of the people were idiots and bigots, and I just got tired of responding.” At e-Parker, Carney says, “nothing like that happened. People were very civil.”
But the story had a happy ending. “It’s turned into a great thing,” Carney says. “There’s a lot of gay people who take pride in what we do in the wine industry.”
I emailed Wine Spectator’s editor, Tom Matthews, asking for comment. Tom, who has previously posted on this blog and with whom I used to work, did not immediately reply. If he does, I will report it here.
I asked Carney why California needs a gay men’s wine tasting group. “People raised that question on the Wine Spectator blog,” he replied. “It’s a matter of comfort. People like to be around the same type. At Wine Spectator’s blog, they have Jewish singles! So people self-select who they want to be around. It’s a social opportunity.”
Magnum isn’t just for gay men, it’s for anyone who likes seriously tasting wine in a nice atmosphere. Members are primarily from Sonoma County, with a smattering from Napa Valley and San Francisco. If you’re interested, go to eventbrite.com and search for Magnum Men’s Wine Events. The next event is a Pinot Noir tasting at Gary Farrell.
Tom Matthews responds: [I got his email after posting]
I appreciate your reaching out to me before commenting on this matter. However, I find your email ambiguous, and am not sure if you are implying that Wine Spectator supported the “homophobic readers” by cancelling posts by Magnum, or supported Magnum by cancelling posts that attacked the group. Let me say first that we would never discriminate against a poster because of their orientation (whether sexual, political or vinous), nor do we tolerate hateful or defamatory comments in our Forums.
(Read our Terms of Service here: http://forums.winespectator.com/eve/tos)
It’s true that Magnum posted a few times on Wine Spectator’s Forums, that there was some vigorous back and forth, and that Magnum has not posted for a while. Your characterization that they were “attacked by homophobic readers” seems provocative to me, but that is a matter of judgment. None of Magnum’s posts were “cancelled,” though some of the less-civil comments by other posters were deleted from one thread.
Here is some background:
On September 6, 2006, a Forums member using the handle “ZinGasm” started a
thread entitled “Monthly Gay Men’s Winetasting Events – Healdsburg Area” on
the WS “Off-Line Events” board. The thread drew a certain amount of
negative feedback from some other users (egregious examples of which were
deleted), but it remained active until March 30, 2007.
You can see the first post in the thread here:
Once we determined the thread had run its course, it was closed by our moderator, Robert Taylor. However, his post closing the thread invited ZinGasm to continue to post:
ZinGasm launched another thread on March 28, 2007, but it again drew some
negative feedback, and ZinGasm seems to have abandoned it after April 4,
2007. You can see that thread here:
In addition, Taylor had some private email correspondence with Zingasm. While I don’t think it would be appropriate to share that with you, I can say that Zingasm stated he was satisfied with our response.
As you must know from your own experience, posts and comments from anonymous users can sometimes be boorish, insensitive, hostile and inflammatory. We try to maintain a balance between allowing free expression and maintaining a respectful community. We did our best with this thread. I don’t know who is trying to dig up old dirt now, but judging from the phrasing of your email, it may be someone with an axe to grind against Wine Spectator. I hope you’ll read through this material thoroughly, and carefully consider anything you decide to say on the matter.
Let me know if you have further questions,