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Let’s not make wine more complicated than it already is

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In the immortal words of Vince “Buzzsaw” Kosciuszko:

Now that I’m retired

I can’t get fired!

So I feel free to express my REAL opinions on wine stuff. There’s a video going around Facebook that I disagree with, even though it portrays a lot of heavyweights who, IMHO, are simply wrong. (They include Phillippe Melka, Andrea Robinson, Bo Barrett, David Breitstein and others.)

The video apparently was first posted by Karen MacNeil, although she didn’t create it. I got it on my Facebook feed via Paul Mabray, with whom I’m friends. The video’s central message is that wine goes through ups and downs, “ebbs and flows” over time after it’s bottled. A major “down” or ebb” is “the dumb phase,” which Andrea calls “one of the deepest valleys a wine can stumble into.” Melka adds that, in such a dumb phase, “The wine totally loses harmony.” “Blank, disheveled, like the whole core of the wine is gone,” Karen MacNeil chimes in, comparing it to “a really bad hair day.”

Andrea explains why ordinary consumers should care. “As the wine lover, the big problem is, you don’t know when that’s going to happen.

The video is cleverly done—high production values, as they say. No wonder: It was created by Partners 2 Media, a Yountville-based media production firm (although it’s not clear to me who paid for the video, or why it was made, or who was paid to be in it, if anyone, all of which would be nice to know). After I watched it, I felt compelled to make this comment on Facebook:

This is essentially marketing bullshit from winemakers. It’s an excuse they tell when their wine doesn’t taste good, or when somebody doesn’t like it. “Blame it on the dumb phase, not the wine.” Well, sorry. A good wine is always going to be good at any age. Besides, this kind of nonsense just makes consumers even more confused than they already are. This is a really stupid and misleading video.

Bo Barrett actually has been talking about “the dumb phase” for decades (he might also have called it “the dip”). I remember him explaining it to me way back when I was at Wine Spectator. He said that, in his case, it applied specifically to Chateau Montelena’s Estate Cabernet, which (if I remember correctly) he said starts out really fresh and delicious (I agree), then slips into “the dumb phase” at about the age of 4 or 5, only to re-emerge some years later, and then plateau for a long time. I took, and take, Bo at his word: surely he knows his own wines better than I, or anyone.

But after my long professional career, I’ve come to regard certain statements about wine as problematic, and this is one of them. As I noted (and as Andrea says), the trouble is that the consumer not only doesn’t know when the wine is going to turn “dumb,” the consumer isn’t even in a position to know if the wine is “dumb.” If the consumer finds the wine too austere, or reserved, or tannic or just plain mehhh, how does it help her to have the idea in her head of “a dumb phase”? This is why I said this just makes consumers more confused than they already are. The implication of “a dumb phase” is that the wine just needs more time in the bottle and all will be well. But how much more time? What can the consumer reasonably expect in another three, six, ten years? If she tries it again and still doesn’t like it, does that mean it’s still in a dumb phase? Or is it just not a particularly interesting wine for her?

The oddest thing about the video is the star commenters telling us that even though the wine may taste awful, it’s actually pretty good. “There’s nothing wrong with the wine,” says Karen. Bo adds, “The consumer should know that the wine tastes fine. It just doesn’t have the aroma.” How can the wine have “nothing wrong with it,” how can it “taste fine” while it simultaneously “totally loses harmony” and “the whole core is gone”? This bizarre incongruity goes unexplained.

As a critic, my ambition was to liberate consumers from the onus of confusing and misleading beliefs about wine, which have been, and continue to be, so harmful to the industry. Consumers should not have to worry that, if they don’t like a wine, it’s because they’re not drinking it at the right time, or they don’t know how to understand it. That just makes them feel insecure. Having said that, I do realize that the wines this video is talking about are the one percent of all production that’s expensive and might benefit from time in the cellar. Still, I feel like a better message would have been the one I’ve consistently given: A good wine will taste good at any stage of its life (except, obviously, if it’s too old or hasn’t been stored well). You can open and appreciate a good wine anytime you want. Even the experts will disagree over when a bottle is ready to drink. It’s all subjective. We should tell consumers who buy these expensive wines (if they don’t already know, and they should), “Different people will like this wine at different points in its life. Some people prefer older wines, some don’t. Besides, all bottles age differently. It’s a crap shoot at best. A good red wine, like Chateau Montelena, should reasonably be excellent for the first eight or ten years of its life. After that, it’s all about personal preference.” In other words, no confusing stuff about “dumb phases.”


Are we overdue for a paradigm shift in wine?

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Copernican moments—also known as paradigm changes–don’t happen often. Change occurs constantly, but most changes shift reality only incrementally. Massive changes, the kind that set reality upside down, are fortunately few and far between—a good thing, otherwise life might prove unlivable. But, as Richard Mendelson, a Napa lawyer who recently interviewed Warren Winiarski, tells us, these Copernican moments are almost never foreseen, and can be identified only in retrospect. Such was the Paris Tasting of 1976, where Winiarski’s Stag’s Leap Wine Cellars Cabernet Sauvignon, from the 1973 vintage, beat out a clutch of other wines, from both California and Bordeaux, in a blind tasting the consequences of which proved to be paradigm-shifting.

Copernican moments also can be personal rather than massively historical, and Winiarski describes his own falling-in-love-with-wine moment (which actually sounds a lot like mine: like me, Warren got bit by the wine bug in an unpredictable and mysterious way).

Warren, who worked early in his career for Robert Mondavi, describes another personal Copernican moment for himself: when Mondavi told him that a wine “must present itself to the eye by way of the building, making it esthetically pleasing, as much as it presented itself to the mouth.” I have never heard a Mondavi quote to that effect before, but it clearly sounds like something Robert Mondavi would have said; and when you think of the Cliff May-designed winery Mondavi caused to be built, it is indeed as esthetically pleasing as any winery in California, a delight to the eye, whose perfect lines and arches and earthy colors bring a sense of serenity and drama to the visitor even before she has had an opportunity to taste the wines. “No one,” Warren Winiarski says, “has looked at winery buildings after that the same way.”

This “esthetic experience,” Warren continues, “brought more than one sense into the experience of wine.” It brought, in fact, more than our five physical senses into the experience; it brought, and brings, an experience that is purely cerebral. Robert Mondavi understood that this meta-level experience might be the most important of all. How one feels about the wine one buys (or anything else one buys) is more than just the sum total of our sensory experiences. It’s about the feeling it evokes in us; and such feelings ultimately are irrational. They cannot be controlled. They can be prompted, and guided towards positive ends, but humans are not robots, and our feelings, evanescent and shifting, are what makes us distinctly human (among other things). Robert Mondavi knew that he wanted to influence our feelings. So has every other great winemaker in history. The best of them believed in the quality of their wine, of course, and worked very hard to ensure it; but they also understood that quality is not enough. A dubious or sated consumer has to be brought into the position where he can actually taste and appreciate that quality. Otherwise, what’s the point? And it does take a certain priming of the pump to get someone to appreciate quality: you have to make them believe that they are capable of appreciating it, and you have then to get them to take steps towards appreciating it, and you have to craft the entire environment within which the experience takes place so that it will increase the probability that the taster will experience quality in a high-minded way.

This, Robert Mondavi understood. It’s not a complicated message. But it can be distorted. Not everyone is as adept at crafting a message of power and subtlety as was Robert, and some overdo it to the point of caricature. Not every winemaker has thought the thing through, which is why not every chat with a winemaker, or every taste of wine, brings about a Copernican moment, even to those of us who are (believe it or not) looking for just such revelation. To expect it to is to demand the unreasonable. The thing that’s so exciting about the wine business at this time is that, while it suffers from a certain stasis, we know that someplace there exists another Robert Mondavi. Not that he will ever be replaced, but somewhere in this world there is a young man or woman, with a vision and the talents to communicate it, who will upset things in the wine world and cause a Copernican Moment to occur—not a small, personal one, but on a global scale, like the Paris Tasting.

What could that be? Who knows. But I have a feeling there’s one right around the bend. We won’t know until it happens, or shortly afterwards. That’s the thing about paradigm changes: you don’t see them coming. But it’s what keeps some of us alert and alive to news from the world of wine.


Big Pot: The marijuana industry learns from wine

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I am astounded how rapidly the marijuana industry is growing into a bona fide, full-fledged business. In fact, it’s starting to look a lot like the wine industry

My marijuana days—and they were many—happened when pot was illegal. You could get arrested for possession of a joint; I knew lots of people who were. We used to try and guess which would be legalized in the U.S. first, pot or gay marriage. I always figured it would be pot. I was wrong, but not by much.

California began the legalization process of medical marijuana back in 1996, but even today, marijuana is not completely legal, as gay marriage is. However, this November, California voters will probably pass the Control, Regulate and Tax Adult Use of Marijuana Initiative, provided it can get enough signatures to make it onto the ballot, which seems likely. And with billions of dollars at stake, entrepreneurs are lining up to grab their fair share of the profits from an industry that—like wine—offers ordinary people pleasurable respite from their daily toils.

The latest evidence of this is an email I got yesterday. It’s from a high-powered investor relations firm, IRP, with offices in L.A., New York, Miami and Hong Kong. The email (you can read it below) was a press release touting a new company, Kush Bottles, a California company (with whom I have no relationship whatsoever, in case you’re wondering) to help “ease the pain and eliminate the headache of entering this fast-growing, opportunistic market.” Kush “provi[des] cannabis companies across the U.S. with market expertise, proper branding and high-quality packaging that satisfies the stringent requirements of the law.”

What strikes me is how high-level all this activity is. Almost overnight, it seems, we’re talking about the stock market (IRP has a lot of NASDAQ clients, and Kush is listed over-the-counter), and a level of complexity to the pot market that requires wannabe players to hire expert advice. The tone of IRP’s press release is extraordinarily similar to the press releases I get everyday from wineries: professional, articulate, and crafted in the public relations jargon language we’ve come to expect from a press release.

The wine industry discovered years ago that if it wants to play in the Big Leagues, it has to do so with bigtime marketing savvy and media relations professionalism. The marijuana industry, now in its infancy, reminds me of Napa Valley wineries in the 1960s and 1970s, when they were owned by visionary but rather naïve people when it comes to business. Wine took decades to go Big Business. Pot took a couple of years, and the way it sells itself is changing overnight. The day of the mom-and-pop pot cultivator is over. Welcome to Big Pot.

Here’s the full text of the IRP email, if you’re interested.

Dear Steve,

My name is redacted and I am contacting you to arrange one of the first interviews with the CEO of Kush Bottles, Inc. (OTCQB: KSHB) – – a rapidly growing Southern California company that is helping entrepreneurs across the U.S. enter the rapidly growing cannabis industry. Nick Kovacevich, the CEO of Kush Bottles is traveling to New York this week and will be available for any live interviews.

Entrepreneurs all over the nation are eager to enter the legal cannabis market, which could approach $9 billion by the end of 2016, according to massive expansion projections in existing medical marijuana markets, which estimate as much as 99% growth.  More states look to implement medical marijuana programs as doctors and researchers continue to uncover the medicinal benefits of cannabis. In addition to the growing medical industry, four states and the District of Columbia have approved recreational/adult-use programs, which further propel the expansion of legal cannabis nationwide.

Unfortunately, cannabis is still one of the most complex industries within the United States. As the laws evolve, new rules are put into place, making it difficult for cannabis businesses to keep up with the challenging regulations that govern legal marijuana. Growers and dispensaries must understand and carefully follow a multitude of laws that govern their business operations. Packaging, branding and labeling represent some of the biggest hurdles that a business must overcome. If any of those elements are mishandled, the business could be fined and/or shut down.

Kush Bottles, a California-based company, publicly-traded under the symbol “KSHB,” on the OTCQB, at approximately $1.35 per share, was founded in 2010 to ease the pain and eliminate the headache of entering this fast-growing, opportunistic market. This forward-thinking startup is a one-stop shop for any business looking to get going in the legal cannabis trade. Using its first-mover advantage, Kush Bottles is providing cannabis companies across the U.S. with market expertise, proper branding and high-quality packaging that satisfies the stringent requirements of the law – all without incurring massive legal fees.  In addition to saving clients thousands of dollars in legal expenses by helping them navigate compliance hurdles, the company also allows their clients to bring in more sales by using proven branding and marketing techniques to help make their products stand out to consumers.

Offering high quality innovative packaging solutions while also providing clients with crucial regulatory insight is the magic formula behind Kush Bottles’ success.  The company has proven its model by continuously growing revenues and posting net profits, which is rarely seen amongst other cannabis-related companies.  Furthermore, as a result of using their regulatory knowledge to help cannabis entrepreneurs achieve compliance, they have built an expansive network of growers, processors, and retailers across the United States.  With over 5000 returning customers to date, Kush Bottles is one of the largest suppliers of packaging and ancillary products for the legal cannabis industry.

We would like to offer you one of the first opportunities to interview Nick Kovacevich, the Company’s Co-Founder and CEO.   Nick has tremendous insight into the challenges that face the legal cannabis industry.  He is always excited to share his vision for helping entrepreneurs overcome these challenges and discuss how Kush Bottles has become the industry-leader in cannabis packaging and branding.

I can be reached via email at psugarman@irpartnersinc.com or via phone at 818-280-6801.

Sincerely,

redacted

Vice President, Media Relations

www.irpartnersinc.com


Millennials and brand loyalty: My thoughts

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When Gallup says Millennials are “the least-engaged generation of customers,” with “the lowest level of customer engagement” of any group of consumers in the country, a couple thoughts come to mind.

Those conclusions come from Gallup’s recent study, “How Millennials Want to Work and Live.” Full disclosure: I read this article, which is from Gallup, about the study, and not the long study itself.

The study’s supposition, it seems to me, is that it’s important for companies to earn the loyalty (committed engagement) of customers, who then go on to become “advocates and brand ambassadors” for the companies’ products and services. I certainly “get” that concept: when I was a young rock-and-roller, groups like the Beatles, Stones, Grateful Dead and Led Zeppelin became superstars through the advocacy of people (like me) who heard them very early and told all our friends to check them out. (I never thought of myself as a Beatles “brand ambassador” but in retrospect, I guess that’s what I was.)

These days, the Gallup study warns, instead of creating such “brand ambassadors,” many companies run the risk of “creating brand destroyers who have a host of digital soapboxes from which to air their grievances.” Lord knows that’s true! I myself have been known to go to Yelp to air grievances about restaurants—although not too often, since I’d rather praise than pan. And with Millennials living on their mobile devices, they’re bound to stumble across “brand destroyers.”

Of course, the news isn’t all bad for all companies: Gallup found that “95% of fully engaged millennial customers say they plan to stay with their wireless provider,” a degree of customer loyalty that bodes well for the wireless providers, since “These fully engaged customers are substantially more likely than other customers to say they would recommend their provider to others…”. That’s what every company wants to hear about its customers.

Thing is, most of us ordinary customers have little choice of wireless provider. I suppose that instead of AT&T, which I’ve had for years, I could have Verizon, Sprint or T-Mobile. But in my mind, they’re Tweedledum and Tweedledee: The new boss is the same as the old boss. Do I love AT&T and would I recommend it to my friends? No. It simply means that AT&T does a decent enough job, and it’s not really worth my time and energy to look into other providers; changing wireless providers can be a real hassle. This is especially true of cable T.V. providers in America, a business that I think is monopolistic. I’ve had Comcast for a long time, but that doesn’t mean I love them. In fact, I don’t particularly like Comcast, but I feel rather like they have me over a barrel. So the mere fact that I’m “fully engaged” with Comcast means nothing.

There’s another factor when it comes to those low levels of engagement by Millennials: The younger people are, I think, the less engaged they are with almost any company. Isn’t that true? Millennials may be highly engaged with, say, Instagram, but Instagram is the outlier. When it comes to soaps, or cereals, or pants, or sneakers or toothpastes or bicycles or toilet paper or rock bands or video games or, yes, wine, I should think Millennials are a lot more experimental (or maybe fickle is a better word) than us more-conservative older consumers; we are admittedly less adventurous, but we do tend to be brand-loyal. Naturally impatient, Millennials are reluctant to commit; they want to keep their options open. And who can blame them? They’re young, figuring the world out. They may be in love with Nike today, only to switch to Asics tomorrow. It doesn’t mean they hate Nike, and it doesn’t mean they have any interest in being a “brand destroyer” for anyone.

The implication of all this is that it’s hopeless for a wine company to pin their strategy on earning the undying loyalty of Millennials. And yet, we know that millions of Millennials will eventually end up liking specific wines and wineries, once they get the experimentation thing out of their heads. Wineries know that, which is why they’ll continue to try to appeal to Millennials as “brand ambassadors.” The trick is to actually get it done. My own two cents is that Millennials, not having a lot of money, are looking for bargains and values. Beyond that, I believe they’re “get-attable” (FDR’s word) with the right combination of flavors, packaging and story-telling. And to understand what that means, you should look at the most popular wines in America, not just among Millennials but everybody, and analyze how they got to that exalted status.


Those “semi-generic” European place names? Let’s ditch them

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In law, the concept of “grandfathering” certain parties into new laws is quite old in America, dating back to post-Civil War days. It occurs, says Wikipedia, when an old rule continues to apply to some existing situations while a new rule will apply to all future cases.” The concept applies across many areas of technology, law and sports. For example, the Green Bay Packers of the NFL are grandfathered out from a rule that prohibits corporate ownership of teams, because their corporate ownership dates to a time before the no-corporations rule was adopted.

When the U.S. and the European Union signed a trade deal, back in 2006, regarding American use of “geographic indications” on wine labels, the deal specified 16 “semi-generic” European place names that could no longer be used on American wines, including Burgundy, Madeira, Sherry, Port and Rhine.

However, under the deal’s terms, American wineries that were using these prohibited place names before March 10, 2006, were permitted to continue to be able to use them; they were grandfathered in. As the Department of the Treasury stated at that time, If there is any question of eligibility for the ‘grandfather’ provision, we will rely on the information that appears in the ‘Brand Name’ and ‘Fanciful Name’ fields on the COLA that was approved before March 10, 2006.”

The deal had a ten-year time period; it expired this year, which led to the parties having to renegotiate it. Politico is reporting that, while both the U.S. government and the Napa Valley Vintners wish for a permanent ban on purloined place names, “the rest of the U.S. wine industry” is pushing to allow “American vintners to keep labeling their products with such regional designations as long as they were doing so before the agreement was struck.” This divide, between the Obama administration and Napa Valley Vintners, on the one hand, and “the rest” of the industry, on the other, “sets up a major showdown” between the U.S. and the E.U.

The Napa Valley Vintners offers a stark illustration of why they’re siding with the E.U. on this one: With the “Napa Valley” mark already appearing on at least one Chinese wine, “How can we go fight for our integrity around the world when the United States doesn’t offer that same reciprocation?” asks a NVV official.

Makes sense to me. I don’t see why we have to have phony European place names on American-made wines. These names may have had a useful purpose in the period after Prohibition, but they no longer do; they are useless anachronisms.

I’m sure that wineries that have used semi-generic places names for decades will have to go through a period of adjustment, if they’re no longer allowed to do so. But the actual wines won’t change, and consumers are smart enough to figure out how to deal with name changes. It’s called “a teaching moment” for the consumer, and you can’t have too many of those. Besides, the historian in me thinks that there will come a day when California (and America) no longer has any of these European place names on labels, and that will mark a significant tipping point in our maturation as a wine-drinking nation, as well as  being a good partner to our European friends. And sometimes, in business, as in life, you have to take your friends’ feelings into consideration, even if it costs you a little.


Unicorn wines, and maybe unicorns in Napa

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When did all this talk about unicorns get so crazy? Suddenly, it’s unicorn this, unicorn that. Fifty-five million results on a Google search, of which this one, published earlier this year in Fortune, is most explanatory: “a unicorn is a private company, valued at $1 billion or more, and they’re seemingly everywhere, backed by a bull market and a new generation of disruptive technology.”

New, over-priced tech companies. Hmm. We’ve seen this before, haven’t we? Back in 2000 we called it the “dot-com bubble,” the catastrophic melt-down of a short era in which seemingly any company that ended with a dot-com enjoyed meteoric growth on the stock market. A good example was a startup called onsale.com. It was popular for a while after amazon.com got too expensive for most people to afford. I should know; I bought a bunch of onsale, and got slaughtered when it collapsed, along with all the other phantom dot-coms.

Now, the word “unicorn” is being applied to wineries. Wine Spectator picked up the term from Twitter back in 2013, quoting Raj Parr’s tweeted definition: “A [unicorn] wine that is ‘rare,’ ‘not seen much’ ‘special bottlings.’ Not always the most expensive but just hard to find.” By 2015, unicorn wines were all the rage in somm circles: the Wall Street Journal said “they confer[red] status not by cost but by the skill—or luck—it takes to acquire one.” Eater jumped into the fray, describing unicorn wines as a new category of wine taking hold in Manhattan—the once in a lifetime bottles that every sommelier dreams of drinking, and bragging about, before they die.” Eater’s list was exclusive to Old Europe, mainly France. You would never find a California wine on a unicorn list, especially not in Manhattan.

Most recently, here’s Wine Spectator again, with Dr. Vinny asking the question, “What is a unicorn wine?” and pointing out that the opposite of unicorn wines are “first-growth Bordeauxs, or ‘cult’ California Cabernets.” Interesting. Not that long ago “cult California Cabernets” were the hottest wines in the world, coveted by everybody. Can it have been only eight years ago that the San Francisco Chronicle called Aubert, Ovid and Sloan “six cult wines to covet”? Today, you won’t find them on anyone’s unicorn list. They’re more like your great-grandfather’s wine than something the cool kids drink.

By the way, the hashtag #unicornwine still gets a lot of play on Twitter, although the category finally seems to be opening up to include California wine—as long, that is, as it fulfills the requirements of being rare and impossible to get. Someone tweeted a link to an Instagram post from “Mcvino82,” who posted this pic of an Inglenook 1978 Petite Sirah with the hashtags #unicornwine and (funnily) #whereisfreddame.

So a nearly 40-year old California Petite Sirah just might qualify as a unicorn. Story time: Years ago, I was on one of my first assignments for Wine Spectator, to interview a wealthy rock-and-roll lawyer who lived in the Hollywood Hills and was a bigtime wine collector. As I pulled into his driveway, a UPS truck was unloading case after case of Dominus, Dunn Howell Mountain, Opus One, Petrus, Tignanello—you get the idea. As we shook hands I tried to make small talk and said, “Man, I see you like the good stuff.”

He pointed with his chin to the stacks of cases on his driveway and said, “That? Nah, I hate it.”

Wow. “Then why do you buy it?” I asked, mentally doing a financial calculation of the cost.

“Look,” he explained, “those are what I call ‘pissing wines.’ You know how, when you’re kids, you have contests to see who can piss the furthest? Well, ___ and ___ [and here, he mentioned some real Hollywood heavyweights] invite me to their homes, and they serve Petrus ’66, so I have to invite them here and give them Petrus ’64.”

I took that in. Then I asked, “So, if you don’t like these wines, what do you like?”

“Ahh!” he grunted, grabbing me by the elbow. “Let me show you.” He led me to his backyard, where he’d dug a storage cellar into the hillside. Rummaging through the racks, he pulled out a bottle. It was a Petite Sirah from San Benito County whose producer, even on that day 25 years ago, was long defunct. “This is what I like!” he exulted.

“What do you like about it?” I asked.

“I like it,” he replied, “because no one else can get it!”

That was the rock-and-roll lawyer’s unicorn wine. So, you see, there’s nothing new about the concept, only the word. And while we’re on the topic of fantasy, it looks like Napa may be getting ready to allow marijuana dispensaries within the city limits. It’s far from a done deal, but I can see a time when upscale tasting rooms selling sips of unicorn wines will also offer unicorn weed to inhale, leading to the very real possibility that tourists emerging from these establishments, staggering down the street, may visualize actual unicorns.

Unicorn2

Photo credit: goodmenproject.com


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