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What Prosecco tells us about the future of wine

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Prosecco, as you know, has been on a roll lately, but when you read headlines like this:

“PROSECCO OVERTAKING CHAMPAGNE AS SPARKLING WINE OF CHOICE”, you know that something far more important than the ephemeral popularity of a particular wine is happening. Why is Prosecco so hot?

Two things:

  1. Millennials coming of age
  2. The Great Recession

Concerning Millennials, they “aren’t earning as much money as their parents did when they were young,” a situation that’s even worse for Millennial women. Saddled with student debt, they’re unable to afford homes, and in general are feeling financial pressures in a way their parents (my generation) never did (at least, until the Great Recession struck). So when it comes to discretionary spending, Millennials are spending downward.

Speaking of that Great Recession, it impacted all of us. Trillions of dollars went down the drain. “The wealth of most Americans down 55% since recession,” CBS MoneyWatch headlined in 2013. We’ve made some of that back since then, but Americans of all ages still are feeling the pinch, which is why U.S. economic growth has been so sluggish.

Under the circumstance, you have to consider two things concerning sparkling wine: quality and price. Simply put, Champagne is expensive, Prosecco isn’t. The average price of a bottle of French Champagne on a restaurant wine list is $117. I couldn’t find anything online concerning the average price of Prosecco, but on Snooth, they list many Proseccos, mostly below $20 a bottle, so even if you double that for a restaurant wine list, it’s only about $40.

And qualitatively, as we all know, a good Prosecco is as satisfying as Champagne. So why would anyone choose to buy Champagne, except for image and perceptions?

For me, the issue here isn’t about Prosecco per se, it’s about the average American looking for less expensive wines than perhaps her parents used to. I was up in Napa Valley yesterday, and we were chatting about expensive wine, and how and if these pricy bottles of Napa Cab will continue to exist into the future. Someone asked me my opinion, and I replied that I’ve been wrong in my prognostications so many times in the past that I’ve basically given up on the prediction game. But still, a part of me just can’t see folks who are, say, in their twenties today spending $50 or $60 per bottle retail as they hit middle age, or spending $100-plus for a bottle in a restaurant. I just think some things in America have fundamentally changed: the Great Recession, as I said, but something else: We’ve become a more frugal country, less apt to consume conspicuously. The outrages of the super-rich have changed our sense of right and wrong; our moral compass has swung back to what it was at this country’s beginnings: living simply.

At the height of the Great Recession, there was much talk of “The New Frugality,” as for instance here and here; everyone agreed it was a reality, and the only question was whether it would continue once the Great Recession lifted. Well, the Great Recession now has lifted (the country actually hasn’t been in recession for years), but, as Forbes noted just last year, an enduring ‘New Frugality’…has Americans of prime working age, mainly 25 to 55, spending less, working less, and buying cheaper.” That, it seems to me, is likely to mark this nation for many years to come. It’s why people are preferring Prosecco to Champagne, and why we’re likely to see a similar switch in other wine types, if it hasn’t already happened.


Bloggers: stop the insults, now.

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There used to be sexism in the wine business. I know, because I know some wonderful women winemakers who began their careers in the 1970s and told me their stories. Even though they had winemaking degrees, they couldn’t get hired anyplace but the laboratory, because the white men who owned the wineries thought they’d be incompetent as winemakers.

Well, we don’t have sexism anymore, thank goodness. But we have another form of prejudice that’s just as pernicious: ageism.

Read, for example, this piece, from Snooth, that refers to “old white guys.” The author of the Snooth piece, James Duren, is quoting Jeff Siegel, the proprietor of a wine blog called winecurmudgeon.com. In the Snooth piece, Duren is writing about the demise of the point-scoring system (yes, again…yawn), and apparently came across something Siegel had written on his blog (I tried to find it but couldn’t, so I will trust that Duren is quoting Siegel accurately). Siegel was going on about how social media is changing wine is such fundamental ways that the entire sales and distribution chain is being upset, which, he claimed, is “something the old white guys can’t even begin to understand.”

Okay, let’s break this down.

First of all, Siegel isn’t exactly some cool young dude. Here’s a picture of him from his website

SiegelPhoto credit: winecurmudgeon.com

that makes it clear his younger self is fast disappearing in the rear view mirror. So words of wisdom, Mr. Siegel: Be careful whom you disparage. What goes around, comes around, in this world of karma.

But even worse than Siegel’s uncalled-for rudeness is its absolute incorrectness. I’ve worked with plenty of “old white guys” in the wine industry who are a lot smarter and more successful than Mr. Siegel will ever be. In fact, the winery owners and executives I know understand precisely how social media, online buying and all that is rocking their world. They’re trying to deal with it the best they can, the same as everyone else: the problem, as I’ve pointed out for years, is that there are no easy solutions.

Look: When you’re a little blogger, it’s easy to pontificate. That’s what some bloggers do: From the ivory tower of their desktops they type the most vapid absurdities into their computers, then hit the “Publish” button and think they come across like Einstein declaring the Theory of Relativity.

But not a single one of these bloggers actually runs a wine business! (If I’m wrong, let me know. But I don’t think I am.) They’ve never sold a damn bottle of wine, never had to hit gridlocked roads visiting with on-premise or off-premise accounts, never had to come up with a marketing campaign, never had to develop a winery website, never sent a wine sample off to a critic, never lived with the fallout of a bad review, never hosted a winemaker dinner, never had to meet a payroll for field workers and secretaries, never had to fix a tractor on a cold rainy morning, never stayed up for three days and nights doing a harvest. None of that, nada, zero, zilch. And yet they think that being a blogger puts them in a position to criticize older winery owners and tell them how to run their business.

Chutzpah!

What is this fear and loathing these not-so-young bloggers have for “old white guys” anyway? Their psychological hangup obviously is connected to their hatred of point scores, and of wine reviewing in general, which they claim is elitist. But then these same bloggers turn around and review wines (from free samples, of course), just like older critics do—and yet without the experience, without the chops, without the context.

Perhaps they’re just acting out subconscious frustrations they feel towards their own parents. Whatever the cause, their anger, rudeness and vitriol is not only ugly, but will hurt them in the long run, because one thing that doesn’t change about the wine industry is that it’s a small town where everyone knows everyone else, and people value respectfulness and kindness. You want to succeed in this business for the long run? Do your homework, learn your stuff, play nice in the sandbox, and wait your turn. You don’t have to tear others down to boost yourself up.

And as for social media completely disrupting the traditional sales model and replacing it with a bunch of “friends recommending to friends,” if you believe that, I’ve got a bridge to sell you. Ain’t gonna happen anytime soon. Social media has become a useful tool in the overall tool kit with which to market and sell wine, but it’s just that: a tool, and not even a very good one, if we’re going to be brutally honest. We’ve been having this conversation now for eight years and social media still hasn’t displaced traditional marketing and sales approaches. If it worked as well as people like Mr. Siegel claim, don’t you think proprietors would have dismantled their sales and marketing departments—thereby saving tons of money—and simply depended on social media? Of course they would have. But they know something that Mr. Siegel doesn’t: Social media doesn’t work as advertised by its adherents. Are these proprietors simply “old white guys who can’t even begin to understand” how the real world works? Or are they savvy businessmen who require proof, not simple, self-serving assertions, that something works? The latter, methinks. No, meknow.


That Constellation-Meiomi deal? Land is more valuable than brand

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I sometimes wonder if the general public knows how much land acquisition is a strategic consideration in many of the winery deals that have gone down in California. Sometimes, these acquisitions don’t make any sense, on the face of it; you wonder why in the hell winery X bought winery Y. But if real estate is part of the deal, it can make a great deal of sense.

Such seems to have been the case with Constellation’s purchase of Meiomi, announced yesterday. Not on Contellation’s part, but on the Wagner family’s.

Meiomi’s proprietor, Joe Wagner, of the family that famously owns Caymus, Belle Glos, Mer Soleil and other wineries, told Shanken News Daily that he was selling Meiomi for an unbelievable $315 million because the deal will give him the liquidity necessary to become a much larger landowner. Wagner says he hopes to amass 2,000-3,000 acres of California vineyards over the next five years.”

“A much larger landowner.” That’s the game the major players are playing these days. Everyone assumes several things: (a) the U.S. appetite for wine will only grow, (b) exports of U.S. wines overseas also will grow, especially as trade deals like the TTP go into effect, and (c) supplies of grapes are only going to tighten as the best appellations and regions get planted out. Under such circumstances, buying vineyards now—or selling a superhot brand like Meiomi for a fortune, in order to buy land later—is smart.

Did the Wagners start Meiomi, back in 2006, in order to sell it after it became hot? Who knows? But I doubt that they, or anyone, could have guessed how wildly successful Meiomi would become. I suspect they started it because, nine years ago, the country was still in the throes of its “Sideways” fascination, and the Wagners surmised, correctly, that you couldn’t have too much good Pinot Noir. Probably, they figured Meiomi would be a nice, profitable little brand, like Mer Soleil or Belle Glos: an affordable Pinot Noir, from coastal vineyards. Myself, I don’t particularly care for it—too sweet, like candy; in a tasting of other Pinots, the sweetness sticks out like a sore thumb. But Americans, at least the ones who buy Meiomi, are gobbling it up: Wagner told Shanken that Meiomi is on par to sell 700,000 cases this year. Perhaps the Wagners looked into their crystal ball and figured out that Meiomi has had its fifteen minutes and is on the way down. This would not be the first winery that Constellation bought that had already reached its zenith.

So we know what the Wagners get from the deal: a boatload of cash that will finance future vineyard and/or land purchases. And what of Constellation? They get a super-famous brand that flies off supermarket shelves, which is really the Constellation business model. I can’t see Meiomi getting better in the future—that would be asking too much of Constellation. But with all their access to grapes, they can grow Meiomi forever, keeping it affordable even as production approaches a million cases.

There’s another thing about buying vineyard land: it’s always there for other purposes besides vineyards. Zoning regulations mean you can’t just do anything you want, but investing in land has been the most secure place to put your money since the beginning of time. And in the case of coastal California, if you happen to have a few extra hundreds of millions of dollars, you can buy some pretty fabulous property that will only increase in value. Whether or not it’s in vineyards in ten or twenty years, you don’t really care; that land is going to be extraordinarily valuable no matter what happens (unless coastal California disappears into the sea in the Big One).


Parker vs. “trendy reds” is a fake choice

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Here, you see, is the false dichotomy that infects so many of our wine conversations today: that there are “two different kinds” of wine and that we, as consumers and writers, “must pick one or the other,” as if we were in a vinous civil war where no one is permitted to be neutral and like both sides equally.

That is once again the premise of this think piece in San Francisco Magazine, whose very headline starkly presents the choice said to be confronting us: Should You Be Drinking Parker Bombs or Trendy Reds?” The article lists six red wines from California that all received “a perfect score from the Wine Advocate” and then contrasts them with six other red California wines “which probably aren’t going to net any 100-point scores…”.

Civil wars are dreadful things. Most people caught up in them, I suspect, would prefer to be left alone to live their lives in peace, but the fact of a civil war makes that practically impossible. We saw this in our own American Civil War (particularly in the border States) and we see it again, horribly, in places like Syria and Iraq, where common people—husbands and wives, children and old people, farmers and merchants and mechanics and teachers—get sucked against their wills into the crosshairs of the most disastrous arguments. Sometimes—often—it seems like these are arguments between maniacs, “full of sound and fury, signifying nothing,” as Macbeth described Life, “a walking shadow, a poor player that struts and frets his hour upon the stage and then is heard no more.”

I submit that this false dichotomy is just such “sound and fury,” that it signifies absolutely nothing, except the unfortunate tendency of the media to fasten on anything that smells of controversy. Those proffering the argument that there are two kinds of wines, and that we must choose, frankly are almost exclusively from the “trendy reds” side of the spectrum. You never hear people who like Harlan or Verité or Saxum say that lighter red wines, such as Domaine de la Cote or Frog’s Leap Cabernet, are undrinkable. No sane or fair wine writer would take that position; if she were to do so, her credibility would be instantly undermined.

And yet the opposite is not the case; that is, writers and somms who like a lighter style of red wine (whatever that means) are able to charge, with impunity, that bigger red wines (whatever that means) are somehow marred or tainted or suspect.

How did we ever arrive at this impasse? More importantly, why do we suffer it to exist, in the exchanges that pass for our national wine conversation, which is supposed to be polite and reasoned, not polemical? This is why I have referred to the purveyors of the “lighter” side of the argument as the Taliban. (See here and here, for instance.)

An extremist, whether religious or cultural or stylistic, who insists that his interpretation of scripture is the only correct one is, by definition, a radical. And haven’t we seen that radicals of all stripes are the last things we need in this world?

So I return again to my old argument: When it comes to “lighter” or “more powerful” red wines, we don’t have to choose. We don’t have to feel as though we must choose, just because some authority (a sommelier, a newspaper columnist) tells us we must. People are so uncertain and insecure about wine; they look for whatever slender reed they can find, to grasp onto lest they be sucked into the quicksand of utter confusion. And this is why those purveyors of false choices do such a disservice to American wine drinkers. By creating the pretense that there is a true canon, as opposed to a false religion, they add to the confusion and, in the process, sow dissention where there ought to be nothing but respectful analysis and personal choice. It’s not and never has been “either-or.” It’s both. I wish that this phony argument, which now has enjoyed more than its expected fifteen minutes of strutting on the stage, would, like Macbeth’s walking shadow, go away and be heard no more.


Gay-friendly: Progress in the wine industry, but a long way to go

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Years ago—it has to be at least ten—I wrote an article for Wine Enthusiast about the emerging gay market for wine, and how important it was proving to be. I was seeing more wine advertisements aimed at gay people, and a handful of wineries was reaching out to them, albeit quietly.

At the time, I knew quite a number of gay people in the wine industry, among them winemakers and P.R. folks, but they were mainly in the closet. The wine industry is generally a pretty open place, but there are pockets of conservatism, and many gay people did not feel comfortable enough to come out.

My oh my, how that has changed. As American attitudes towards gay people (and we’ve now expanded that to the acronym GLBTQ) have softened, the presence of gays in wine, always there but largely invisible, has become clearer. It is due to a generalized spirit of welcoming that inspired the wine community, but it’s also recognition that the gay community has a lot of disposable income—and gay people like to drink wine (according to The Daily Beast, Gay people drink 16 percent more than straight people”).

I’ve never been one to lump Americans, though, into separate-but-equal identity groups. It seems to me that, since we’re all in this together, we ought to find ways of association that transcend things like gender, race, religion, age, ethnicity and sexual orientation—even political persuasion, which sometimes can be the most difficult difference to bridge. But that’s idealistic, I’m sure; the truth is that we do tend to feel binding ties with people who are like us, and I suppose that’s good, as long as it doesn’t make us so chauvinistic that we forget that we’re actually tied to everyone.

I don’t think, even when I was younger (when such an event would have been unthinkable), that I would have gone to Out in the Vineyard’s recent Gay Wine Weekend, held in Sonoma County. And now, when I’m old enough to be most of the attendees’ father, I’m not sure I would have been comfortable had I gone. But I sure am glad Out in the Vineyard exists, and I’m super-glad that Jackson Family Wines, exemplified by La Crema, supports it. This company is strongly pro-GLBTQ, a progressive stance I wish more California wineries shared.

Some wineries feel that being too closely identified with GLBTQ issues—which remains contentious among some unkind people in America—will hurt their bottom line. The wine industry, like most industries, constantly keeps tabs on how it’s perceived. Wineries don’t want to be thrust into the position of being on the backlash end of a homophobic boycott, as Wells Fargo recently was when the celebrity-preacher, Franklin Graham, exhibited narrow-minded and hateful behavior in criticizing Wells for having the temerity to put on a gay-friendly T.V. commercial. Graham, who seems not to understand the direction of history, or perhaps just doesn’t care, no doubt instilled fear among some winery proprietors who, personally, have no problem with the GLBTQ movement, and might even privately support it; but who fear the wrath of a popular religious leader whose admonitions are obeyed by millions.

One can hardly blame wineries for being afraid of such pressure; I cast not the first stone. But it does make me even prouder of gay-friendly wineries, not only Jackson Family but also J, Windsor Oaks, Sebastiani, DeLoach, Francis Ford Coppola, Ravenswood, Gary Farrell, Iron Horse, Lynmar, Korbel, E&J Gallo and many, many others. That’s the good news. The not-so-good news is that wineries (like most U.S. corporations) still tread exceedingly carefully using obviously gay people in their marketing and, especially, their advertising. Rev. Graham, and people like him, unfortunately have succeeded in getting their threatening message across: The stifling of free speech.


When Mohammed won’t come down from the mountain

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So I called up this winery the other day. It’s not too far away from Oakland. I’m putting together another tasting and asked if I could buy a bottle of their Cabernet Sauvignon and have it shipped to me. The guy—the owner-proprietor, I think—said no. He said it’s not worth his while to “drive down the mountain” to send a single bottle. If I wanted to buy a case, he explained, that would be a different story.

I thanked him and told him I wasn’t looking for an entire case, so goodbye. No $ale. But the incident bothered me and so I put it up on Facebook and asked my friends, “What kind of a business model is that?”

Lots of comments, as usual. I suppose I think more about these marketing and sales issues since I’ve worked at Jackson Family Wines than I would have when I was at Wine Enthusiast. I thought the winemaker’s attitude was pretty dumb (not that he was rude about it; he wasn’t. In fact, he couldn’t have been nicer. He simply explained that he was way up in the middle of nowhere). The bottle price, by the way, was $27.

What did my Facebook friends say? You can read all the comments here. Most of them roundly criticized the guy. Jeff Stai, from Twisted Oak, wrote I’m way up in the mountains and I’ll sell you a bottle. wink emoticon.” He added Today’s one bottle sale is next month’s five case sale.” Bill Smart said the guy’s business model is “One that is not going to last for very long?” (Bill did put it in the form of a question.) Chris Sawyer said the business model is a “case study [in] how to inflict bad mojo on your brand.” Sean Piper said “If you ever buy a bottle of my wine I’ll personally hand deliver it to you.”

And yet, the guy had his defenders. Neil Monnens wrote, “More power to him…Imagine you are his friend or family and he leaves you to go down the mountain to sell one bottle of wine to someone…it’s not worth it. Good for him.” Victoria Amato Kennedy wondered “What was the profit margin on the one bottle after factoring in gas/shipping costs/time?” I understand that, but I would have paid whatever shipping cost the guy charged me. The fact of the matter is, he was too lazy to drive down the mountain. As Patrick Connelly wrote, “Bad customer service = increasing selling difficulty.”

If I had a little family winery (which this was) I’d drive down the mountain! How hard can it be? It’s summertime, no rain, easy-breezy. Besides, even if it’s a 30-minute drive to the UPS Store, aren’t there other things the guy can do while he’s in town—buy groceries or supplies, call on an account, have a nice meal, see a friend? I’m sure that people who live up in the mountains always have lists of stuff to do when they’re in town.

As I’m constantly reminding people nowadays, you do what it takes to sell your wine. Establishing customer relationships is one of those things. Although I didn’t identify myself to the guy, how did he know I wasn’t buying the wine for a Parker tasting? I could have been some rich Silicon Valley venture capitalist looking for a house Cabernet. You never know. Sending somebody a bottle of wine can sometimes change your life in unexpected, great ways. But first, you have to be willing to come down from the mountain.


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