Tag Archives: wine prices

2011 wine price update

Some thoughts to follow up on the December post about what the experts are calling consumer-friendly wine prices in 2011:

? Italy invented pinot grigio as a wine to sell in the United States, but the recession may have helped change Italy's pinot grigio dominance. Alfonso Cevola, the Italian Wine Guy, has done an analysis of selected U.S. pinot grigio sales for 2010, and California looks like it will replace Italy as the varietal's top producer. There are a couple of couple of caveats, says Alfonso, but his conclusion looks solid. And the reason California is passing Italy? Cheaper wines, such as Barefoot, which are replacing Italian brands that cost $10 or more. "Value wines still reign," he wrote.

? How far have white zinfandel sales fallen? So far that Beringer, which is among the top two white zinfandel producers in the country, is not only price cutting, but marketing. And the last time anyone needed to market white zinfandel in the U.S. Never, probably. Beringer is giving away a downloadable single from crooner Michael Buble, and has teamed with Buble to pair wine, songs, and food. This is a lot of trouble to go to sell a $7 wine.

? The Wine Economist blog has put much of what has happened over the past couple years in perspective, and has discovered consumer-friendly pricing in the process.  "As I am writing this, the neighborhood Safeway is offering an extra 20% off any wine selling for $20 or more," noted Mike Veseth, who posted that the sales increase in more expensive wines that has the industry so excited is almost certainly coming from this kind of discounting.

? A few Dallas-area, very consumer-friendly prices from the past couple of weeks of shopping: Rodney Strong chardonnay, about $15 list, for $10; Wente chardonnay, about $15 list, for $10; and House Wine, a very nice red blend from Washington state, usually $12 or $13, for $10. Looks like it's time for a House Wine review.

The Freakonomics view of the wine business

Stephen Dubner is the co-author of the popular Freakonomics books and blog, which look at economic theory from a less than traditional perspective. In this radio interview transcript, Dubner talks about wine prices and the wine business, and whether price reflects quality and whether the experts are really experts.

A couple of the Wine Curmudgeon's pals show up, including Robin Goldstein of The Wine Trials, and it's a decent discussion of the objective vs. subjective nature of wine quality and wine prices. Which is nothing new to regular visitors here.

But anyone who appreciates what we do on the blog will love this. Dubner quotes his Freakonomics co-author, Steven Levitt: "My approach to buying wine for gifts is simple: I go in the store, and I look for the label that looks the most expensive of anything in the store. And I make sure it costs less than $15, and if it does, then I buy it."

Maybe I should should send each of the Steves a tin of Wine Curmudgeon M&Ms.

“Consumer-friendly” wine prices

I’ve been digging around for the last couple of months, trying to get a sense of where wine prices are headed in 2011. My gut feeling is that we’re in for at least another year of oversupply and lower prices, with lots and lots of previous vintages still clogging winery back rooms and distributor warehouses. The recession may have officially ended, but the wine business is far from recovering.

And that seems to fit with the anecdotal evidence I’ve seen — news stories, talking to retailers and distributors, and walking around grocery and liquor stores and comparing prices. I saw Perrier Jouet, a $40 bottle of Champagne, going for $25 in an ordinary, national chain grocery store. Three years ago, the producer would have refused to allow its wine near the store, let alone be sold there or discounted.

The best description of where we’re going? It came from a Dallas retailer whose family has been selling wine for about as long as it has been legal to sell wine in Dallas. “I call it consumer-friendly,” he said. “Pricing will be beneficial to the consumer. There’s still a lot of wine out there, and there are still a lot of deals to be found. I’m buying them whenever I can.”

So, for at least another year, $10 is still the new normal.

Winebits 154: Hall of Fame, Asian wine prices, wine terms

? 2011 Vintners Hall of Fame: And it doesn’t include Robert Parker or Fred Franzia, both of whom were nominated. This is silly. Both men, whatever you think of them, have had Hall of Fame careers, and I’ll write more on that later this week. The 2011 inductees will include Ravenswood founder Joel Peterson (subject of a Wine Curmudgeon podcast); UC Davis’ Vernon Singleton; and Bob Trinchero, owner of Sutter Home Winery and Trinchero Napa Valley. Chalone Vineyards winemaker Richard Graff and August Sebastiani will be inducted as Pioneers.

? Exorbitant wine prices: What do you do if you live in China and have too much money? You buy French wine. Decanter reports that Asian bidders paid stratospheric prices in a recent Hong Kong auction. Two cases of 2009 Chateau Lafite, which won’t be bottled until next year, fetched US$68,632. That’s almost six times the estimate. And a case of 2000 Lafite, estimated at US$20,000-30,000, sold for US$71,751. Said one analyst: “There is a lot of money out here, and a lot of demand for good cellars. But even taking that into consideration, those prices were crazy.”

? Feds looking at wine terms: Ever wondered what wine terms like Proprietors Blend, Old Vine, and Reserve mean when they show up on wine labels? The Treasury Department’s Alcohol Tax and Trade Bureau, which oversees label regulation, wonders too. It is asking for public comment on whether it needs to write regulations for those terms, as well as several others. You can download the request for comments from the TTB site. It’s Notice No. 109. It’s not too difficult to read, either.

Gary Shansby and the dilemma of wine education

Gary Shansby tells the story with an almost wistful air. A good friend of his, who is smart and wealthy, will only drink Grey Goose vodka. Gary, who owns Partida Tequila, offered to buy his friend a Partida. No thanks, says the friend. I only drink Grey Goose. Can I buy you another kind of vodka? asks Gary. No thanks, says the friend. I only drink Grey Goose.

Why do you only drink Grey Goose? asks Gary. Because it's the best, says his friend. How do you know that? asks Gary. Have you tried any other vodka? No, says the friend. Have you tried my tequila? No, says the friend. Then how do you know that you don't want to try anything else? Because I don't, says the friend. I just know.

Shansby finishes the story and I laugh. He has outlined, neatly, the dilemma facing those of us who do wine education. Yes, this story is about tequila and spirits, and I usually don't do much of that here. But Shansby is also a wine drinker who knows how the business works, and Partida makes some damn fine tequila. I was especially impressed with the blanco (about $45, sample), which had almost nothing to do with the cheap, poorly made tequila that one sees around Dallas.

Besides, the principle is the same, whether we're talking about tequila or pinot noir. It's not enough that wine is confusing. We also have to fight the prejudices that consumers pick up, many of which are fostered on consumers by the companies that sell wine.

"There are so many great wines all over the world — from Chile, from parts of the U.S. — that it's just so confusing to the consumer," says Shansby. "But that also means that they are so many great wines to try at so many attractive prices."

In fact, he says, those attractive prices are going to be around for a while. The recession is the main reason (and he expects its effects to be with us for a long while), which is something we've discussed here many times before. Producers are stuck with unsold wine, with more wine in the production pipeline, so they are cutting prices to move it. Shansby says it won't be unusual to see discounts of 20 to 40 percent. So why not take a chance and experiment? Why not try a wine from a different region than your usual? Why not try a different varietal?

Just don't, says Shansby, let your prejudices make your decisions for you. And who can argue with that.