Big Wine is dumping cheap wine brands – first Ruinite and Constellation; is a Yellow Tail sale next?

yellow tail sale

Will the roo have to find a new job if there is a Yellow Tail sale?

What does a Yellow Tail sale say about the future of cheap wine in the U.S.?

This year’s unprecedented cheap wine sell-off might include an even bigger shocker — a Yellow Tail sale. The $7 Australian supermarket wine is the biggest imported wine in the U.S., but the company acknowledged last week that it had been approached by several prospective buyers. This came after an Aussie financial newspaper reported that the Casellas, the family that owns Yellow Tail, had hired an investment bank to help them sort through the offers.

The Yellow Tail sale news comes on the heels of Banfi ending its 52-year partnership in March with Riunite, the $5 Italian sweet red, plus the Constellation Brands fire sale in April. That’s when it sent most of its $10 wines to E&J Gallo.

Know that almost all of the wine brands in these deals are profitable, and some immensely so. In fact, Yellow Tail is the fifth best-selling brand in the U.S., while Banfi’s marketing agreement with Ruinite helped it sell 2 million cases a year. And Constellation was so eager to rid itself of its cheap wines that it sold them at a tremendous discount and included Black Box, the sixth best seller in the U.S.

Does any of this make any sense? Not really, if this was 1999. But it’s 2019, and the wine business is obsessed with premiumization, and that trumps all. There was an odd and meandering story on wine-searcher.com last week, which asked if popular wine brands could be successful. This seemed, at first glance, like asking if rain was wet. How could something like the 20-million case Barefoot not be successful?

Because, said the article, size doesn’t matter. And, given the perspective of premiumization, that makes perfect financial sense. Whether it’s good business is a post for another day.

Hence, it’s not enough to sell millions of cases of wine anymore, like Yellow Tail, Ruinite, and Black Box. In this, Yellow Tail seems to be a private equity takeover target, just like any other business with cash flow and a well-known brand. The new owners would buy the company with cheap borrowed company, cut costs, strip Yellow Tail of its least profitable assets, goose up the bottom line, and then re-sell it.

Banfi’s CEO admitted it was too difficult to sell cheap wine given premiumization, and that the company would focus on its “premium and luxury offerings.”  In other words, wine for the one percent. What a terrifying thought for those of us love wine and who are part of the 99 percent.

Do consumers need to start worrying about flat sparkling wine?

flat sparkling wine

Bubbles here, but not everywhere.

Flat sparkling wine seems more common than ever – or is it just my imagination?

Why have so many bottles of sparkling wine – including pricey Champagne – been flat when I’ve opened them? As many as one-half of the bottles I’ve tasted over the past nine months have opened with little more than a sigh, and the bubbles disappeared from the glass after the initial burst of foam.

Yes, this is a small sample size, no more than a couple of dozen bottles. But when I was going through my notes to find a sparkling wine to use for the Mother’s Day post last month, I kept seeing the word “flat” in my notes. One entry even said, “tastes like cava should taste, assuming it was supposed to be flat.”

And I don’t remember a streak like this in the 20-some years I’ve been tasting sparkling wine professionally. And it’s just not cheap bottles or bottles from mass retailers; this has happened with bottles from some prestigious regions and well-known retailers – $40 wine, even, as well as samples, which should be as fresh as can be.

The blog’s official sparkling wine winemaker told me it probably isn’t a production flaw. That’s possible, he said, but the chances are remote. Sparkling techniques have improved tremendously over the past decade, so quality control in the winery isn’t the problem it used to be.

Either I’m having a run of bad luck, he emailed me, or it’s the supply chain – too much sparkling wine sitting on warehouse shelves getting old, or being stored in less than optimal conditions in supermarket supply rooms.

Which is the scary part. Is there so much sparkling wine on the market that it isn’t selling quickly enough to remain fresh? This makes sense, given the slowdown in wine sales over the past couple of years. In addition, the increase in mass-produced bubbly like Barefoot and La Marca means there is not only more product on store shelves, but more product made to begin with. And, as we’ve talked about before, it’s more difficult t0 monitor quality when you’re making 1 million cases than if you’re making 10,000.

So is this my imagination? Or is this a problem, but one that that is going unrecognized because most of us don’t drink enough bubbly to notice it?

Photo “Blanc de blanc” by Marcus Hansson is licensed under CC BY 2.0

TV wine ad survey: Hochtaler box wine – even Canadians miss the point

Hochtaler box wine uses a “Cabaret” knockoff ad to sell its sweet white wine, which probably isn’t what the film had in mind

Film buffs know the social, cultural, and political significance of “Cabaret,” the 1972 musical starring Liza Minelli, Michael York, and Joel Grey. So why did Canada’s Hochtaler box wine use a “Cabaret”-themed ad to sell its products in the early 1980s?

Hochtaler, writes the blog’s official Canadian correspondent, has long been famous in Canada – call it the Franzia of the Great White North, boxed wine for cat ladies who say “eh.” In this, Hochtaler is local, made with Canadian grapes by a Canadian producer.

“It’s very sweet,” writes our correspondent. “I’m guessing it was a hit with young people new to wine and older wine drinkers who like the name, which sounds European, and how sweet it is.”

Nevertheless, the ad features a nightclub scene with a chanteuse doing her best Liza Minnelli, complete with German accent, top hat, and tails. It hardly seems appropriate for this kind of wine, but the ads were apparently quite popular.

And you can still buy Hochtaler – C$14.95 for a 1.5-liter bottle at your local Ontario provincial store.

Video courtesy of robatsea2009 via YouTube, using a Creative Commons license

More about TV wine ads:
TV wine ads: Almost 40 years of awful
TV wine ad survey: Richards Wild Irish Rose
TV wine ad survey: 1970s Boone’s Farm Wild Mountain

Wine of the week: La Fiera Montepulciano 2017

The La Fiera Montepulciano is Hall of Fame quality $10 wine from one of the world’s best quality and value importers

Premiumization continues its rampage through the wine business. It’s getting more difficult to find wine costing less than $15 that’s worth drinking; I’m writing a longer and more thorough post about the premiumization crisis that will run in the next week or so. Until then, be grateful for wines like the La Fiera Montepulciano, which still offer value and quality for $10.

I’ve tasted the La Fiera Montepulciano ($10, purchased, 13%) twice over the past four months, and it has gotten earthier and more interesting That’s an impressive achievement for any wine, especially for a $10 wine, and especially these days.

That it has done that is a testament to the importer, Winesellers Ltd. in suburban Chicago, whose wines show up a lot on the blog (and who I wrote about recently in a wine business trade magazine). The Sager family, which has owned Winesellers for 40 years, doesn’t follow trends. It searches for value, and would that more importers did that anymore.

The La Fiera is an Italian red made with the montepulciano grape in the Montepulciano d/Abruzzo region. As such, it comes from a less well known region and is made with a less respected grape, which usually means better pricing for consumers.

In this wine, it also means a little earthiness is starting to show, and the wine is a touch heavier and more serious than it was in February. Again, impressive for a $10 label. Look for zippy cherry fruit, balance, and tannins hiding in the background.

Highly recommended, and a candidate for the $10 Hall of Fame. It’s a terrific food wine as well as a reminder what an importer can do who cares about the consumer and not focus groups.

Imported by Winesellers Ltd.

Winebits 598: RNDC distributor merger, local wine, red vs. white

RNDCThis week’s wine news: The country’s second biggest distributor, RNDC, is going to merge with the fourth biggest, plus Italians stick up for local wine and red wine drinkers are much cooler than white wine drinkers

RNDC tries again: RNDC, the country’s second biggest distributor, will merge with No. 4 Young’s Market. This comes in the wake of RNDC’s failed merger with No. 3 Breakthru Beverage in the spring, which the federal government said would violate anti-trust law. The story in this link calls the merger “a distribution joint venture,” but read it all the way through and it says Young’s will become a division of RNDC. Which sounds like a merger, but I’m not the one RNDC executives have to convince. That would be the Justice Department. Regular visitors here know how I feel about this stuff; it’s a great deal for the distributors, allowing them to cut costs and increase margins, and not so good for the wine drinker and too many wineries that aren’t Big Wine. But it’s all part of the thrill and excitement of the three-tier system.

Local wine means local wine: Farm house bed and breakfasts in the Italian region of Lombardy must serve only local wine to their guests, reports the The Local, an Italian news site. “Under a new amendment to the regional law. … the more than 1,600 agriturismi– farms offering tourist accommodation in Lombardy will have to prioritize local specialties. They will be limited to getting 20 percent of their products from outside the region, and none of their fish or wine (though wines from vineyards directly adjoining Lombard soil are considered acceptable).” The story doesn’t explain why the law was passed – no doubt it was caused by a particularly Italian dispute.

Red vs. white: Red wine drinkers are much cooler than white wine drinkers, according to a recent poll. “Nearly half of red-wine drinkers considered themselves ‘wine aficionados’ compared to 31 percent of white-wine drinkers. And red-wine drinkers also showed they knew slightly more about wine in a series of follow-up questions compared to white-wine lovers.”And who took this poll? None other than Coravin, the $250 wine opener whose target audience, not surprisingly, is expensive red wine drinkers. This is yet another example of someone paying for a study to get certain results, something I have written about many times before. And, to her credit, the woman who wrote the story in this link mostly did just that.

Technical difficulties: The blog’s RRS feed and email service may not be working correctly

The blog’s email and RSS feeds may not be working correctly

Update, 2 p.m. Monday: We think it’s fixed. It wasn’t when this morning when I first updated this post. Today’s email didn’t go out, but we;ll figure out how to get it to you. Thanks for your patience. If you’re still having problems, please let me know.

If you get the blog via email or RSS feed, you may not see what you’re supposed to see. Both services starting hiccuping on Friday afternoon when we tried to fix something else. That means you may see something that says “WordPress resources at SiteGround” on your email and RSS — and no, no one is quite sure why that is there.

I’m working with the blog’s web guy and the company that handles the RSS and email feeds to fix the problem. Hopefully, we can get it straightened out today, but bear with us. The site itself is fine, and you can check out the latest posts by going to winecurmudgeon.com.

Barefoot wine review 2019: Cabernet sauvignon and chardonnay

Barefoot wine review 2019Barefoot wine review 2019: The cabernet sauvignon and chardonnay have a dollop or three of residual sugar, but otherwise taste like they should

This is the 12th Barefoot wine review I’ve written, and one thing is as aggravating today, for Barefoot wine review 2019, as it was 12 years ago: No screwcap. Why E&J Gallo, Barefoot’s owner, still uses a cork closure on most of its labels is beyond me. The only time these wines are “aged” is after they’re opened, when they sit in the refrigerator for another day. A screwcap would make that kind of aging so much easier.

The Barefoot wine review 2019 features the non-vintage cabernet sauvignon ($5, purchased, 12.5%) and the non-vintage chardonnay ($5, purchased, 13%). Both, save for a dollop or three of residual sugar, are among the best Barefoot efforts in years. Yes, that’s damning with faint praise, given the quality of the wines in many of the previous reviews. And their sweetness left that dried out feeling in my mouth for 20 or 30 minutes after tasting. But that Barefoot varietal wines taste like their varietal is worth noting.  Put a couple of ice cubes in the glass, and the wines are certainly drinkable, if too simple and not very subtle.

The cabernet tastes of dark berry fruit (boysenberry?), and there are soft tannins, a certain acidity, and restrained fake oak. No chocolate cherry foolishness here, though the sweetness gets more noticeable with each sip and may annoy wine drinkers who expect cabernet to be dry.

The chardonnay, ironically, is less sweet than the cabernet. Take away the sugar, and it’s a pleasant California-style chardonnay — almost crisp green apple fruit, that chardonnay style of mouth feel, and just enough fake oak to round out the wine. There’s even a sort of finish, which was about the last thing I expected. Once again, though, the sweetness gets in the way —  would that Barefoot had the courage of its convictions to make a dry wine dry.

More about Barefoot wine:
Barefoot wine review 2018
Barefoot wine review 2017
Barefoot wine review 2016