Tag Archives: wine rants

Follow-up: Paul Tincknell and the woes of wine marketing

More examples showing that wine marketing lacks imagination and doesn’t focus on why people drink wine

Last week’s podcast with Sonoma wine marketing guru Paul Tincknell elicited a fair amount of comment, especially since it ran at the end of the summer when most people have other things to do besides listen to podcasts about the decades-long failure of wine marketing.

As one reader emailed me: “Commercials showing people drinking grocery store wine at swank parties? People get paid for coming up with that stuff?”

Paul received some feedback, too. A colleague shared data with him about a 2009 wine consumption survey: “The results,” Paul emailed me, “are fascinating and confirm that – guess what! – people drink wine with family and friends at meals or in casual situations.” The colleague told Paul that the survey results were given to almost every important wine marketing and trade group in the country, but that, “of course, the industry immediately ignored their work.”

In other words, the business has known for at least a decade how U.S. consumers enjoy wine and the best way to market to them: Show people drinking wine at dinner with their friends and family. That hardly seems like a creative reach. (And we’re not the only ones who have seen this — check out this rant from Paul Mabray, who is generally regarded as one of best wine and consumer experts in the country).

Instead, we get epic silliness like the Kim Crawford “Undo ordinary” commercial, a long-time favorite of blog readers. And, no, it didn’t get an almost unprecedented 33 comments or become one of the blog’s most visited posts because everyone thought it was cutting edge genius.

In fact, Kim Crawford (owned by Big Wine’s Constellation Brands) seems to go out of its way to show up in these kinds of analyses. Paul sent me two especially foolish commercials; the one that made me giggle the most is at the top of this post, called “Make it Amazing.” Who knew I had sway my butt just so to be a cool, sophisticated wine drinker? The other, called “Elevate the Moment,” looks like something from a short-lived 1990s PBS series about rich people.

Is it any wonder I worry about the future of the wine business?

Video courtesy of Kim Crawford Wines via YouTube using a Creative Commons license

Wine prices, razor blades, and premiumization

razor blads

“Dude, shaving is so old school.”

“Lower shaving frequency” is a fancy way of saying razor blades cost too much, which means men don’t shave as often

More men are apparently growing beards, costing one of the biggest companies in the world $8 billion this year. The reason? “Lower shaving frequency,” according to the financial analysts. I prefer the reason given by one of the Millennials quoted in the story in the link: Razor blades cost too much money.

In other words, men aren’t shaving as much; they’re shaving better. Sound familiar?

In this, the wine and razor businesses are eerily similar. A handful of big companies control each category, which means oligopoly pricing. A razor and two or three blades can cost more than $20, and there’s no way the actual cost of a little metal and some plastic is anywhere near that.

And razor-speak can be as indecipherable as wine-speak: “Gillette Fusion ProGlide Razor Handle with FlexBall Technology,” for example. Can anyone who doesn’t work for Gillette’s ad agency explain what that means?

The high cost of shaving

Obviously, there’s more going on here than the high cost of shaving. Most importantly, the culture has changed; the days of coats and ties and offices, where men had to shave every day, are something for TV shows like “Mad Men.” My beard dates to the late 1980s, and even then they weren’t common. And we certainly didn’t grow them to be hipsters, a common occurrence these days.

But you can’t ignore the cost of razors and blades. Says a Millennial in the MarketWatch story: “I don’t love the $5 price for a replacement blade, since it equates to a yearly expense of more than $200 — an amount equal to a good dinner at a decent restaurant, even perhaps with a bottle of wine. And trust me: I’d much rather be dining in style than shaving.”

In all, the men’s shaving products market has shrunk by more than 11 percent in the past five years. This dovetails with a recent Nielsen survey, comparing the drinking habits of Millennials, Gen Xers, and Baby Boomers.

Overall, a little more than two out of five Millennials don’t drink for health reasons and almost one-third don’t drink because it’s too expensive. Drill down, and Nielsen finds that the youngest group is 11 percent more likely to not drink because it costs too much, compared to their parents and grandparents.

High wine prices, decreased consumption. High razor blade prices, decreased use. Does anyone else see a pattern here?

Has wine with dinner been turned into binge drinking?

binge drinking

Please, neo-Prohibitonists: Stop these people before they binge drink again.

Yet another booze study characterizes responsible behavior as binge drinking

Another studying demonizing drinking showed up last week, replete with the flaws that have come to characterize these studies. The authors cherry-picked their study group, ignored relevant statistical data, and glossed over any socio-economic and demographic explanations for their conclusion. The result? Old people! Binge drinking!! Death!!!

The other thing that struck me about the study was its definition of binge drinking: four to five drinks in one sitting. In other words, drinking wine with dinner has become just as evil as frat boys chugging Everclear and men of a certain age pounding a six-pack after work and then passing out on the sofa.

My name is the Wine Curmudgeon, and I am a binge drinker.

On Saturday night, I had five glasses of wine with dinner. We had hard-cooked eggs in mustard sauce for a first course, followed by a mock cassoulet (turkey, sausage, a duck leg/thigh, and white beans) served with rice and a cabbage salad. I opened the $10 Pigmentum Gascon white blend with the eggs, which was a terrific pairing (the wine’s citrus fruit complementing the richness of the egg). I drank the fabulous 2011 Bonny Doon Bien Nacido syrah with the cassoulet, and it was an even better pairing – dark, earthy food with a dark, earthy wine.

So how did a full dinner eaten over two or three hours with five glasses of wine turn into binge drinking?

Your guess is as good as mine. The five-drink definition (four for women) comes from the National Institute for Alcohol Abuse and Alcoholism: Binging is “a pattern of drinking that brings blood alcohol concentration (BAC) levels to 0.08 g/dL This typically occurs after 4 drinks for women and 5 drinks for men – in about 2 hours.”

Not coincidentally, that 0.08 number is the legal definition of drunk driving in 49 states. If it’s illegal to drive after five drinks, then it’s easy to call something binging. Or, conversely, let’s lower the legal blood alcohol level to 0.08 since the experts call that binge drinking.

And do not think this is an apologia for alcoholism and drunk driving. I know first-hand the horror and pain of each. Rather, it’s a plea for a measured, reasonable, and rational approach to solving the problems they cause.

That’s because drinking is not the problem. Abusing alcohol is the problem. Trying to shame responsible adults into stopping behavior that isn’t shameful won’t do much to stop alcohol abuse. Didn’t the neo-Prohibitonists learn anything from Prohibition? Hopefully, they’ll eventually figure this out. Until then, I’m happy to do my part to explain it to them.

Photo: “company dinner” by Rivard is licensed under CC BY-ND 2.0 

More about neo-Prohibitionists, booze studies, and wine drinking:
• Cigarettes, wine, and cancer
• Drinking, scientific doom and gloom, and perspective
• The CDC alcohol death study

Wine business history: The more things change, the more they stay the same

wine business historyIn the wine business, history repeats itself – and we know what premiumization, overpriced wine, and consolidation mean for consumers

Premiumization, overpriced wine, and consolidation are nothing new in the wine business. Go back 80 years, and wine business history is eerily familiar. In this, some of the earliest and most influential wine critics, including Leon Adams and Frank Schoonmaker, warned the industry about the mistakes it was making.

And I would be remiss if I didn’t quote Winston Churchill here: “Those who do not learn from history are doomed to repeat it.”

Premiumization

Schoonmaker was a wine importer and wine writer whose 1930s’ “The Complete Wine Book” might have been the first attempt to explain wine to the U.S. consumer. In 1947, in a piece for Gourmet magazine, Schoonmaker lamented what sounds a lot like what we’re seeing now:

And in the past five years we have hardly seen any real vin ordinaire (by which I mean a common, inexpensive table wine) sold in America. The humble gallon jug virtually disappeared in 1943 from our wine merchants’ shelves; instead, the undistinguished reds and whites from the mass production areas of California appeared in fancy dress at a fancy price, and elaborate advertising campaigns were launched to convince us that bottles which we used to buy reluctantly for 60 cents were suddenly worth $1.50 and were being sold us as a special favor.

In other words, $15 wine is the new $8 wine.

Overpriced wine

Adams was perhaps even more influential in his time (the end of Prohibition to the 1960s or so) than Robert Parker was in his heyday. He is usually given credit for pushing the California wine business into the 20th century; he advocated for regional wine long before there was much of it; he helped start the Wine Institute; and he wrote several of the most important wine books in U.S. history.

He also had no use for over-priced wine, and regularly urged California producers to make wine that most of us could afford:

They should be as cheap as milk. High price wines are not for daily consumption with meals. Real wine drinkers know this; most Americans still don’t.

How spooky is that quote, that it’s still so relevant today?

Consolidation

Adams also saw the dangers of too few wineries producing too much of the country’s wine, something he first warned about shortly after World War II. He explained this in a 1974 interview:

The point was mine, and I think it has stuck to this day, that the little wineries should be encouraged to exist. The larger the number of small wineries that operate in the United States, the safer the big wineries are from attack, legislative attack in particular. If the wine industry ever fell into the hands of only a few major factors, the wine industry and the whole cause of wine would be in trouble. It would be endangered. … The big wineries have never agreed with me about the need to foster the small wineries. … My purpose is to encourage the use of wine, to introduce the use of table wine, which local wineries can do. Moreover, it’s especially to the advantage of California to thus expand the wine market, because with the ideal grape-growing climate of this state, California wines will always be the best buys.”

I wonder: How many of the biggest California producers have ever read that?

Photo courtesy of Sedimentality blog using a Creative Commons license

Five things the Wine Curmudgeon learned from last week’s wine premiumization post

wine premiumizationMost importantly: Consumers dislike wine premiumization, no matter what the wine business wants us to believe

Last week’s wine premiumization analysis kicked up more than a little dust in the cyber-ether – it was the most visited post on the blog in almost 2 ½ years. The comments and emails covered the spectrum, from people blaming me for wine’s problems (and that there wouldn’t be any if not for people like me) to those who offered their take on premiumization (pro and con) to those who thought I was spot on.

In all of this, I learned five things after writing the wine premiumization post:

1. Consumers dislike premiumization, no matter how much the industry insists otherwise. I wasn’t sure about this until I saw the reaction to the post, since all the data suggests we’re paying more for wine. So if we’re paying more, then we’re happy, right? But since fewer of us are buying wine, and those of us who still buy wine are buying less, how happy can we be?

2. Talking about wine prices is even more taboo today than it was when I started writing about wine in the late 1990s. There was a sense then that pricing was not to be questioned. Because, wine. I’ve never understood this, and my emphasis on cost vs. value has always annoyed people in the wine business. It annoys them even more today – and some are way past annoyance.

3. The economics of the post-modern wine business stink for almost everyone who isn’t Big Wine. I sympathize with those producers, and have agonized over their plight many times. But overpriced wine is overpriced wine, regardless of the reason why. Is any bottle of wine really worth $80 or $100? Or, as hard as it is to believe, thousands of dollars?

4. I taste thousands of wines a year, at all prices and from all over the world. My friends also taste thousands of wines a year, and we talk about what we taste. So how am I not qualified to say that wine quality is not what it was before the recession? One friend, a well-known wine judge and critic, will start his pinot noir rant without one nudge from me. Yes, technically the wines are OK — not oxidized, not tainted with VA and so forth — but are they interesting to drink? Are they fun to drink? Unfortunately, not nearly as many of them as in the past.

5. Wine writing, even in the second decade of the 21st century, is still expected to be positive and to sell wine. I had hoped the Internet would change that. I was wrong.

Photo courtesy of IWA wine blog using a Creative Commons license

Wine premiumization, wine prices, and quality

Wine premiumization
• The Wine Curmudgeon Wine Sample Index and the wine slowdown

Wine premiumization: Prices keep going up, quality keeps going down, and fewer people are drinking wine. Am I the only one who thinks that’s not a coincidence?

This is how deeply premiumization has upended the wine business: A reader emailed me to say I shouldn’t use the prices I paid for wine in my reviews. Instead, I should use the prices on an industry website, which are typically more than what I pay.

What twisted wine universe do we now live in? Is premiumization so deeply ingrained in the system that cheap wine should not exist, even if it actually does?

Premiumization is the idea that consumers are trading up, that we’re willing to pay more money for a better quality bottle. In theory, this makes perfect sense. Of course I will pay $15 for wine if I know it’s going to be appreciably better than a $10 bottle.

But theory, to paraphrase the economist John Maynard Keynes, is for dead people. The wine business, in its dedication to short-term profit at the expense of long-term growth, is selling us more expensive wine that isn’t appreciably better. It just costs more money, and we’re supposed to accept that as the natural order of things.

I got a sample of an Italian white wine this summer, which came in a flowery bottle with an even more flowery name. My tasting note? “Very nicely done $10 blend (chardonnay, pinot bianco) with a little lemon, minerality, and crispness. For some reason, the suggested retail price is $20, making it one of the most overpriced wines I have ever tasted.”

It’s not just me

A friend of mine, who has been selling quality wine at Dallas’ best retailer for more than 30 years, told me he no longer understands how wine is priced. He cited two examples: Spanish albarino, once $10 and $12 and delicious, is now $18 and $20 and not very albarino-like, while French picpoul, “which should cost $8, costs $16.” These are wines that people in Spain and France drink daily; in the U.S., they’re priced for special occasions.

Or, as a review of a $24 wine on Wine Industry Insight put it recently: “Thin, acidic, and lacking fruit.” How far has wine fallen when $24, which used to be enough to buy something fabulous, now only pays for thin and acidic?

I write all of this in the shadow of the end of the wine boom: Flat sales, more young people who see wine as something for their parents and grandparents, and experts who say drinking will kill us as surely as cigarettes. It’s what Rob McMillan of Silicon Valley Bank calls the new normal – that wine consumption won’t return to what the industry wants. Instead, he writes, “don’t be surprised if young consumers drink less alcohol tomorrow, and those who do drink continue to embrace craft spirits and beer instead of wine.”

Given all of this, shouldn’t it be time for the industry to put an end to the premiumization that gives us $8 worth of wine for $15? If wine is in a fight for its future, shouldn’t it focus on selling well-made and affordable products in response to the competition from craft beer and spirits?

That makes perfect sense

But I long ago stopped expecting that sort of wisdom from wine. In this, I thought I saw the end to wine premiumization several times over the past couple of years, and I’m not the only one who did. But just when you think it has run its course and this foolishness can’t go on forever, it does a Freddy Kreuger. How else to explain when the man who runs Jackson Family Wines wants the federal government to eliminate his competition with a tariff wall?

All of which leads me to wonder how far we are from something that wine economist Mike Veseth has predicted for several years: That wine will become like opera, which was once mass entertainment but is now reserved for a wealthy elite.

That’s a new normal that won’t make anyone happy.

Photo “tokyoWeek1 047” by nate_uri is licensed under CC BY-NC-SA 2.0 

More about wine premiumization:
• “Reasonably priced at $40:” Wine premiumization is out of control
• The premiumization backlash
• Has premiumization damaged wine’s popularity?

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