tag:blogger.com,1999:blog-941731830705031230.post6877552047074215561..comments2024-03-25T02:53:48.654-07:00Comments on SVB on Wine: Wine Supply is Entering Unknown TerritoryRob McMillan rmcmillan@svb.comhttp://www.blogger.com/profile/12396624790174552807noreply@blogger.comBlogger55125tag:blogger.com,1999:blog-941731830705031230.post-91703102472926781262019-09-24T23:01:02.373-07:002019-09-24T23:01:02.373-07:00Addendum
Don't castigate winemakers for addin...Addendum<br /><br />Don't castigate winemakers for adding sulfur to your wine.<br /><br />They are trying to protect against this unwelcomed experience . . .<br /><br />From the San Francisco Chronicle Online<br />(posted September 24, 2019):<br /><br />"The mysterious and not fully understandable wine defect popping up in natural wines: mouse"<br /><br />URL: https://www.sfchronicle.com/wine/article/There-s-a-mouse-in-your-wine-14465005.php<br /><br />By Esther Mobley<br />Wine CriticBob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-18458974091236040432019-09-24T22:56:27.618-07:002019-09-24T22:56:27.618-07:00Dear Anonymous:
Concerned about what is in your w...Dear Anonymous:<br /><br />Concerned about what is in your wine -- beyond grape juice and yeast?<br /><br />See this article . . .<br /><br />From the San Francisco Chronicle Online<br />(posted April 13, 2017):<br /><br />"Myth-busting in the realm of wine additives"<br /><br />URL: https://www.sfchronicle.com/wine/article/Myth-busting-in-the-realm-of-wine-additives-11071548.php<br /><br />By Esther Mobley<br />Wine CriticBob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-16640414888496845132019-09-24T22:41:16.425-07:002019-09-24T22:41:16.425-07:00Anon 4:12 Thanks for your thoughts. Most of your t...Anon 4:12 Thanks for your thoughts. Most of your thoughts are spot on with what I'm preaching these days and it's refreshing to hear a young consumer say it in this kind of forum.<br /><br />Your pretty close on the definition of moderate. Here is a link to the USDA guidelines that has 5 ounces for women and 10 per day for men. https://health.gov/dietaryguidelines/2015/guidelines/appendix-9/<br /><br />The wine industry isn't stretching the definition of the USDA guidelines. In fact, the wine industry today is doing virtually nothing to defend itself from what at times is absurd claims from the anti-alcohol movement. I don't think we need to make up anything. The existing science supports wine as a healthy part of a diet. We are choosing to remain silent as an industry which is crazy from my perspective.<br /><br />But regarding your statement on paying a premium for health - all the science, some of it linked above for your view, shows that wine consumed in moderation is healthy. And I am depending on that science and the industry to bring back the narrative into the light and remind consumers that wine - more than any other alcoholic beverage, has properties that can lead to better health outcomes than those who abstain and those who abuse. If people believe it is healthy in moderation, I do believe they will pay more. Today it costs more than beer or spirits, but we have to ask ourselves - why is it more valuable and worth more?<br /><br />The industry is making lower alcohol drinks but it's a mixed result. "Lower alcohol" is probably a better path versus non-alc or low alcohol. Low alcohol loses its flavor and balance because of the process used to make it. But wine could be made that has a target for lower alcohol. That is in part why sparkling and Prosecco sales are doing so well. <br /><br />I am personally glad we're past the point of running alcohol up into the 17% range. I want to enjoy wine and I can't drink as much if there is that high an alcohol percentage. I'm happy to pay for "lower alcohol" wine and buy more of it.<br /><br />Also 100% agree with your comments on the process of making wine and labeling (the contents). In good wine, the only ingredients are smashed grapes and sulfites. No sugar. Grapes are from minimalist and sustainable farming practices, often times organic, biodynamic and/or chemical free vineyards. There is no added sugar, non-GMO, gluten free, lactose free, vegan. We should let people know that. We should put calories on labels and be really clear about what is in the bottle. That's what the consumers like you want, and if we told you the story - you would like wine a little more.<br /><br />Thanks again for the spectacular point of view. I'm hoping the industry will read your post.<br />Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-73796038021058586612019-09-24T22:40:50.879-07:002019-09-24T22:40:50.879-07:00Dear Anonymous:
Wish a low alcohol wine?
Conside...Dear Anonymous:<br /><br />Wish a low alcohol wine?<br /><br />Consider an Italian Moscato at 5.5% ABV.<br /><br />URL: https://stellarosawines.com/our-wines/stella-rosa-moscato-dasti/<br /><br />Wish a low alcohol brewed beverage?<br /><br />Consider a 2.5% ABV Radler.<br /><br />URL: https://www.beeradvocate.com/beer/profile/817/68049/Bob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-78796529504003146642019-09-24T22:36:17.171-07:002019-09-24T22:36:17.171-07:00Dear Anonymous:
There are alternative beverages t...Dear Anonymous:<br /><br />There are alternative beverages that share some characteristics with alcoholic beverages -- yet are alcohol free.<br /><br />Consider Seelip.<br /><br />URL: https://seedlipdrinks.com/uk/story/<br /><br />Consider hop water.<br /><br />URLs:<br /><br />https://h2ops.com/<br /><br />-- and -- <br /><br />https://www.goodbeerhunting.com/sightlines/2018/8/26/lagunitas-to-introduce-ipa-inspired-hop-flavored-sparkling-waterBob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-85998908413061753062019-09-24T22:32:11.166-07:002019-09-24T22:32:11.166-07:00Dear Anonymous:
I believe this was a typo: "...Dear Anonymous:<br /><br />I believe this was a typo: "sulfates"?<br /><br />See this article . . .<br /><br />From the San Francisco Chronicle “Food & Wine” Section<br />(August 22, 2008, Page D1ff):<br /><br />“Reconsidering sulfites;<br />Progressive vintners weigh the pros and cons<br />of the controversial winemaking tool.”<br /><br />URL: http://www.sfgate.com/wine/article/Reconsidering -- sulfites -- 3272258.php<br /><br />By Wolfgang M. Weber<br />Special to The Chronicle<br />Bob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-81312499872599753992019-09-24T22:27:15.429-07:002019-09-24T22:27:15.429-07:00Dear Anonymous:
The accepted standard for the pou...Dear Anonymous:<br /><br />The accepted standard for the pour size of a glass of wine in the U.S. is 5 ounces. Not less. Not more.<br /><br />Excerpt from The Wall Street Journal "Personal Journal" Section<br />(May 1, 2007, Page D1):<br /><br />"The Accidental Binge Drinker: How Much We Really Pour"<br /> <br />URL: https://www.wsj.com/articles/SB117797544301787472?ns=prod/accounts-wsj<br /><br />By Tara Parker-Pope<br />"Health Journal" Column<br /><br />"While too much alcohol obviously adds calories to your diet, other consequences of supersizing alcoholic beverages are even more worrisome. The health benefits of alcohol disappear and risk increases when you drink more than a few servings a day. And because over-pouring can double or even triple a standard serving size, many of us are technically 'binge' drinking without knowing it, wreaking havoc on our livers and overall health. <br /><br />"A standard 'serving' for an alcoholic beverage is 5 fluid ounces of wine, 12 ounces of regular beer or 1½ ounces of distilled spirits, according to the Centers for Disease Control and Prevention. All three portions contain 0.6 ounce of alcohol. . . ."Bob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-2047137144671232452019-09-24T16:12:03.917-07:002019-09-24T16:12:03.917-07:00All the studies point to moderate - moderate being...All the studies point to moderate - moderate being the key word - consumptions as healthy. In most studies moderate is defined as 5 ounces. That's less than a glass of wine. <br /><br />So.. I think the real challenge for the wine industry is to embrace actual moderate drinking and to stop stretching the definition of moderate. <br /><br />Young consumers, and I'm one of them, are willing to pay premiums for health. Kombucha is flying off shelves for example. The wine industry can easily fit in here. Make low to no alcohol, high antioxidant drinks. It still uses the wine grapes, it still needs the wine makers in a sense - but it bags the restless nights and hangovers that accessible wines present. On another note - the consumer needs to understand the process of making wine and what goes into it. We want to make sure our beef cows were given a kiss everyday for crying out loud - we definitely want to know what sulfates are in wine. No ingredient labels? No promises of nothing bad in it? No thank you. I'm being dramatic here to make a point. <br /><br />Of course traditional wine doesn't go away - but if you're trying to create new demand... it's much much harder to reverse a message than it is to create a new one. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-1517735814248880722019-09-05T22:25:31.186-07:002019-09-05T22:25:31.186-07:00Now here is the flip side of this agricultural con...Now here is the flip side of this agricultural conflict: an Oregon vineyard suing in federal court its cannibis farm neighbor "over fears the grapes were contaminated with the smell of marijuana."<br /><br />"Alleged marijuana damage to grapes ruled plausible"<br />Capital Press online - posted September 4, 2019<br /><br />URL: https://www.capitalpress.com/state/oregon/alleged-marijuana-damage-to-grapes-ruled-plausible/article_a95ce280-cf68-11e9-8b22-67ef35339263.htmlBob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-36845062142982203672019-09-04T15:35:20.704-07:002019-09-04T15:35:20.704-07:00Tercero - thanks for staying engaged. This is fall...Tercero - thanks for staying engaged. This is falling off topic a little but I agree with your point. The regulations in SB County had holes that allowed stacking permits to grow, and allowing a very large grow. I can't imagine being a winery trying to serve high net worth clients with skunk odors flowing through, and view sheds of white fences and heavy security. Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-22464413115115453992019-09-04T14:47:58.983-07:002019-09-04T14:47:58.983-07:00Indoor grows make more sense, but that's not n...Indoor grows make more sense, but that's not necessarily what's going to happen. If you want to see 'ground zero' for cannabis versus wine grapes, check out what's happening down here in SB County. There are serious 'challenges' with the two industries co-existing, at least with the extremely lenient policies the Board of Supervisors has enacted (and is now having to walk back on). Cheers.tercero wineshttps://www.blogger.com/profile/11718156055439684277noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-45005203624451281532019-09-04T14:25:25.777-07:002019-09-04T14:25:25.777-07:00Anon 11:38. Thanks for commenting.
I'm not su...Anon 11:38. Thanks for commenting.<br /><br />I'm not surprised. Last year after harvest, it became pretty clear that we might see lower prices for pinot - and most other varietals. The only varietals that have positive volume growth in the past 12 months are Cabernet, sparkling wine, rose, and Prosecco.<br /><br />Nielsen accounts for scaned sales, including domestics and imports. Their data can be broken out though.Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-27187580834815031582019-09-04T14:08:43.109-07:002019-09-04T14:08:43.109-07:00Marc - You misspelled your first name. Anyway, tha...Marc - You misspelled your first name. Anyway, thanks for the comment. Living in Napa and watching the regulatory dance on cannabis, I hadn't thought of the indoor versus outdoor options for cannabis growers. I would think that would limit both smell and cross contamination. <br /><br />Either way - you don't need to plant very much to satisfy demand. The growers in Oregon have discovered that. <br /><br />I'll be interested to see how Napa deals with allowing marijuana as a crop. It doesn't have to be grown in Napa to be used by residents or tourists, but I can see how someone might want to profit off the Napa brand that's been created.<br /><br />Do we next allow tourists to visit the grows, like I went to see a dairy farm in 3rd grade? Does the wine community cross market at events where weed is sold?<br /><br />I don't have good answers but am open to several outcomes. I just know that growing cannabis isn't going to be a salvation for current vineyard owners. Next I can go into the story of my first year in banking where a borrower ripped out all their pear trees and planted Jerusalem artichokes ... but thats a story to have over a glass of wine.Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-53753290543963684522019-09-04T13:19:57.550-07:002019-09-04T13:19:57.550-07:00Rob, I agree with your response, and also it's...Rob, I agree with your response, and also it's easier, cheaper, and faster to grow Cannabis indoors. Outside of more artisinal strains, it won't make sense to replace wine with Cannabis, and even the artisinal can be grown elsewhere, so it doesn't need to replace.Marc Hausernoreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-86214253150294460792019-09-04T13:01:35.480-07:002019-09-04T13:01:35.480-07:00Anon 6:12 - thanks for your comments and addition ...Anon 6:12 - thanks for your comments and addition to the dialogue.<br /><br />Farming costs and labor in particular are a concern for everyone. It's not just how much does it cost, but can I find labor at all?! No question that adds a dimension. Getting immigration reform would be one solution but that will take me down a rabbit hole.<br /><br />And yes, we will see the imbalance adjusted by seeing removals. They always happen at the margins with the weakest going early. In fact I had a conversation this morning with an industry insider in the Central Coast who said there were removals taking place as we speak. The timing is telling because grapes are still on the vine in many if not all of those cases cited.<br /><br />I want to be careful though about settling too much on the trends that are just ugly to watch. Because there are businesses that are doing quite well. It's not yet a train wreck. There is still time to evolve and work together on demand.<br /><br />The silver lining in any of these cycles is there will be good wine sold at lower prices. And price is an issue for the young consumer. If those higher quality wines find their way into $11 - $17 bottles, we will make a step in increasing demand from young consumers, which is paramount for industry health.Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-88493683285721030022019-09-04T00:32:43.776-07:002019-09-04T00:32:43.776-07:00[DELETED AND REPLACED TO CORRECT FOR A TYPO.]
Ano...[DELETED AND REPLACED TO CORRECT FOR A TYPO.]<br /><br />Anonymous:<br /><br />You write:<br /><br />"What role has institutional investment into new, large un-contracted plantings had on the over-supply situation? e.g. all of the new CS and PN on central coast?"<br /><br />In the Central Coast, water rights tied to vineyards are the key asset -- not the vines or their harvestable fruit.<br /><br />"Meet the California Couple Who Uses More Water Than Every Home in Los Angeles Combined"<br />Mother Jones online - posted August 9, 2016<br /><br />URL: https://www.motherjones.com/environment/2016/08/lynda-stewart-resnick-california-water/<br /><br />[Who got into trouble for clear-cutting thousands of native California oak trees to construct an above-ground irrigation pond at Justin Vineyards & Winery.<br /><br />"Paso Robles Winemakers Divided Over Water"<br />Wine Searcher - posted June 20, 2016<br /><br />URL: http://www.wine-searcher.com/m/2016/06/paso-robles-winemakers-divided-over-water]<br /><br />-- and --<br /><br />"Harvard Spent $100 Million on Vineyards. Now It's Fighting With the Neighbors"<br />Bloomberg online - posted November 15, 2018<br /><br />URL: https://www.bloomberg.com/news/articles/2018-11-15/harvard-spent-100-million-on-vineyards-some-neighbors-complain<br /><br />-- and --<br /><br />"Harvard Quietly Amasses California Vineyards -- and the Water Underneath"<br />Wall Street Journal online - posted December 10, 2018<br /><br />URL: https://www.wsj.com/articles/harvard-quietly-amasses-california-vineyardsand-the-water-underneath-1544456396<br /><br />-- and --<br /><br />"California in overdraft"<br />Palm Springs Desert Sun online - posted December 10, 2018<br /><br />URL: https://www.desertsun.com/story/news/environment/2015/12/10/california-overdraft/76372340/<br /><br />A backgrounder on vineyard dry farming and irrigation:<br /><br />"Drought revives ‘forgotten art’ at wineries: Farming without irrigation"<br />Los Angeles Times online - posted November 22, 2014<br /><br />URL: https://www.latimes.com/business/la-fi-dry-farm-wine-20141123-story.html<br /><br />-- and --<br /><br />"3 Myths About Irrigation and Dry Farming"<br />SevenFiftyDaily - posted December 19, 2017<br /><br />URL: https://daily.sevenfifty.com/3-myths-about-irrigation-and-dry-farming/<br />Bob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-32773318645004291922019-09-03T23:46:16.329-07:002019-09-03T23:46:16.329-07:00Steve:
You write:
“Those with a strong balance s...Steve:<br /><br />You write:<br /><br />“Those with a strong balance sheet, decisive and agile decision makers and good brand equity will likely do just fine over the next several years. You and I both know that many, if not most, of the wineries out there do not possess all of these attributes. For those that don't, the premium has never been higher on the basic blocking and tackling of business and sound financial decision making. . . .”<br /><br />Let me proffer again on Rob’s blog an introduction to this book on “basic blocking and tackling” to grow your business:<br /><br />“The Business-Building Tools Marketing Execs Ignore”<br />Advertising Age online – posted May 31, 2005<br /><br />URL: http://adage.com/print/103337]<br /><br />“The Marketing Forum [address by] Michael Treacy . . . mapped out in his speech the most broadly applicable and compelling marketing manifesto I’ve heard.<br /><br />“The speech lasted an hour, and the book from which it was derived, ‘Double-Digit Growth: How Great Companies Achieve It No Matter What,’ is 214 dense pages in paperback, but here’s the Cliffs Notes.<br /><br />“Substantive business growth in Western corporations is rare . . . but entirely achievable. Not because there is a magic bullet (we all know bullets are bull), but because 10% or more can be eked out through discipline, hard work and attention to a handful of potential growth areas.<br /> <br />. . .<br /><br />“FOUR AREAS OF FOCUS<br /><br />“Those areas include: 'share gain,' grabbing a percentage point or two at the expense of a competitor; 'base retention,' stemming the loss of existing customers to the point where your churn rates fall below the average; 'market positioning,' also known as showing up where the growth is going to happen; and 'adjacent markets,' whereby a marketer moves into a related business. Treacy’s research has shown proper attention to any one of these will contribute a few percentage points of growth. Put them together and what do you have? Yep, double digits.<br /><br />“A great overview and an encouraging message. But the audience seemed disheartened; several told me they found the speech 'depressing.' Confused, I quizzed a few, until one solved the riddle for me: 'He said marketing is a difficult way to grow a business.'<br /><br />“A NARROW INTERPRETATION<br /><br />“The penny dropped. By 'marketing' this executive meant the focus on 'share gain,' which Treacy did, indeed, say was by far the 'toughest way to grow.' In other words, the marketers interpreted their roles so narrowly -- as people who hawk for new business -- that Treacy’s message seemed to say they faced nothing but an uphill battle. His optimism about growth through customer retention, innovation and the identification of growth markets was lost on them.<br /><br />“This is a problem. A Spencer Stuart study showed CEOs expect the marketing department to drive growth, but many marketers are focused on only one growth avenue: customer acquisition. (And, worse still, on one tool to achieve that: purchasing, approving and post-justifying advertising).<br /> <br />. . .<br /><br />“CUSTOMER RETENTION<br /><br />“Had Treacy encountered this issue? ‘Oh yes,’ he said. ‘Look at Detroit. They give away an average of $4,000 on every car trying to find new buyers, not to mention the billions they spend on ads. How much do they spend on base retention tactics? Almost nothing. Despite the fact that with a two-thirds churn rate, a small improvement would yield major growth. The marketing department doesn’t think that’s their job.’”<br /><br />. . .Bob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-63311037811429203212019-09-03T23:38:26.286-07:002019-09-03T23:38:26.286-07:00Rob, were you surprised that the price of pinot no...Rob, were you surprised that the price of pinot noir grapes in every significant CGCR region was down this year? Do you see this as an anomaly, a varietal oversupply, or a canary in the coal mine for the wider market? The weather could be different this time next year, but any thoughts/bold statements about where we stand now?<br /><br />Also, does that Nielsen overall revenue vs. volume growth account for imports or only domestic wine? If the former, that paints a grim picture for some domestic producers, especially with imports growing significantly in that "premiumization" range. If the latter, maybe our outlook is a little less gloomy in terms of demand stagnation? Am I off at all here?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-74455889938566321652019-09-03T21:03:23.143-07:002019-09-03T21:03:23.143-07:00I was told (by a Bordeaux grower whose name escape...I was told (by a Bordeaux grower whose name escapes me) that they replant at about 45 years of age.<br /><br />The notion that North Coast vintners are already replanting at 25 years of age is both surprising and troubling.<br /><br />Will the next replanting cycle be at (say) 15 years of age due to regional warming, pushing Bordeaux varieties to the sidelines?<br /><br />(Aside: It does not escape one's attention that Touriga Nacional has been proposed for planting in Bordeaux.<br /><br />Back in the 1800s, "Syrah from Hermitage was sold to Bordeaux . . . to help improve their wines in light years, giving the wines darker color, more structure and backbone."<br /><br />Source: "Rhone Valley Complete Guide Cote Rotie Hermitage Chateauneuf du Pape," The Wine Cellar Insider)<br /><br />"Bordeaux winemakers allow new grapes to fight climate change"<br />Decanter magazine online - posted July 2, 2019<br /><br />URL: https://www.decanter.com/wine-news/bordeaux-new-wine-grapes-419730/)<br /><br />"The end of Cabernet in Napa Valley?"<br />San Francisco Chronicle online - posted August 16, 2019<br /><br />URL: https://www.sfchronicle.com/wine/article/Napa-wineries-confront-climate-change-by-planting-14308512.php<br /><br />-- and --<br /><br />"Saving cabernet from climate change"<br />Morning Ag Clips online - posted August 22, 2019<br /><br />URL: https://www.morningagclips.com/saving-cabernet-from-climate-change/Bob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-49189996354496971802019-09-03T20:11:22.643-07:002019-09-03T20:11:22.643-07:00Joel:
You write:
"Speculation is that the b...Joel:<br /><br />You write:<br /><br />"Speculation is that the big players will profit in a long term play as they acquire financially-strapped properties at great discount."<br /><br />Tim Fish at Wine Spectator addressed this back in 2013 when he spoke about wineries seeking an "exit strategy":<br /><br />Excerpt from Wine Spectator Online<br />(November 12, 2013):<br /><br />"West Coast Wineries Are Up for Sale -- Quietly”<br />(A wave of recent deals show investors see opportunities in wine, while owners see an exit strategy.)<br /><br />URL: http://www.winespectator.com/webfeature/show/id/49221#.UoI_yAMMzG8<br /><br />“. . . While small wineries can succeed by selling most of their inventory direct to consumers and large producers have muscle with wholesalers, those in the middle -- annual production of 5,000 to 15,000 cases, for example -- can’t get much attention from distributors unless the brand is hot.”<br /><br /><br /><br />W. Blake Gray addressed this back in 2017 when he wrote about mid-sized wineries being given the cold shoulder by distributors:<br /><br />Excerpts from The Gray Report<br />(July 31, 2017):<br /><br />"Wine trade secrets revealed at OIV Wine Marketing Program"<br /><br />URL: http://blog.wblakegray.com/2017/07/wine-trade-secrets-revealed-at-oiv-wine.html<br /><br />"John Collins, CEO of a company called GreatVines that sells alcohol distribution software, started the week off with a slap in the face to all wine companies: 'None of the wine companies are getting any attention (from distributors). Period. Because the spirits companies are that important to the distributors.'<br /><br />"Collins compared the profit size of Diageo, a huge spirits company, to Jupiter. Gallo, the largest wine company, is Neptune. And if Gallo doesn't matter to a big distributor like Southern Glazer's, no wine company does. . . ."<br /><br />"The opposite of Constellation was a presentation by Bruno Walker, director of sales and marketing for Chambers and Chambers Wine Merchants, a California distributor with an outstanding fine wine portfolio. <br /><br />"Walker was one of several speakers to caution people that large distributors won't do much to sell wines by small wineries. <br /><br />"'If your wine is not on some kind of special of the month, it won't sell' at a big distributor, Walker said. 'That sales person is not out making presentations of your wine. Their manager is telling them, you've gotta sell this and you've gotta sell that. That's how their bonuses work. That's how they're hired and fired.'<br /><br />"But Walker also chilled expectations for what a distributorship like his can do.<br /><br />"'The reality is, I have 15,000 unread emails,' he said. 'Most people are really, really busy.'<br /><br />"He said that when his salesmen present wines to stores or restaurants, they only have about 45 seconds per wine. 'We have to be able to deliver a compelling story, quickly,' he said."<br /><br />~~ BobBob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-30541091985990211502019-09-03T18:12:56.441-07:002019-09-03T18:12:56.441-07:00Great post, Rob. Three points I'd like to mak...Great post, Rob. Three points I'd like to make.<br />This down cycle be longer and worse than previous down cycles because of a couple of additional reasons to supply and demand mentioned above. 1) We've never before seen an increase in the cost of farming like we are experiencing between now and 2022, when minimum wage will be at $15 and ag-overtime laws are shortening the agricultural week to only 40 hrs. Growers in North valley, south valley, & central coast currently just surviving selling grapes for less than $500/ton will not be economically sustainable in the short term as per acre production costs increase by 35-40% in the next few years. Grapes will come out of the ground.<br /><br />Secondly, a question: What role has institutional investment into new, large un-contracted plantings had on the over-supply situation? e.g. all of the new CS and PN on central coast?<br /><br />Lastly, Wine Institute needs to promote and spearhead a marketing order for CA wine, ASAP! Our education and marketing efforts for wine compared to the beer, seltzer, and spirits industries is like comparing the military spending of the Vatican vs. the United States. We all need to come together as an industry--the big wineries/growers and small wineries/growers alike. We can't depend on another 60 minutes French Paradox or a Sideways Part Deux to drive the next demand phase. We have to roll up our sleeves, open our checkbooks, and do it ourselves. It can be done with enough participation, cooperation, and vision.<br /><br />Thank youAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-15260944310309097672019-09-03T17:10:41.669-07:002019-09-03T17:10:41.669-07:00[DELETED AND REPLACED TO CORRECT FOR A TYPO.]
Reg...[DELETED AND REPLACED TO CORRECT FOR A TYPO.]<br /><br />Regarding the California Raisins TV campaign, the salient question that the California Raisin Advisory Board marketers had to ask themselves was: will the incremental lift in sales revenue (if achieved) exceed the incremental cost of producing the TV ad campaign?<br /><br />This is the challenge with every advertising campaign for commodities. History demonstrates few succeed.<br /><br />(Aside: the Claymation singing and dancing figures and the music recordings spun off from that TV campaign were clearly a success. But "public awareness" was not the goal of the campaign. Increased unit sales for a stagnant commodity table fruit was the goal.)<br /><br />"History of the California Raisins"<br />Food & Wine online - posted September 17, 2016<br /><br />URL: https://www.foodandwine.com/fwx/food/california-raisins-history<br /><br />Citing the Wikipedia entry:<br /><br />"Although popular with the public, the California Raisin campaign eventually failed because its production cost the raisin growers almost twice their earnings. CALRAB, the organization who made the campaign, was also closed on July 31, 1994, due to disagreements with raisin producers over the fairness of required payments to the organization."<br /><br />URL: https://en.wikipedia.org/wiki/The_California_Raisins<br /><br />The basis for the Wikipedia citing on the campaign's production costs is this article:<br /><br />"The Raisin Situation"<br />New York Times online - posted April 27, 2019<br /><br />URL: https://www.nytimes.com/2019/04/27/style/sun-maid-raisin-industry.htmlBob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-89469998039041215462019-09-03T16:34:24.636-07:002019-09-03T16:34:24.636-07:00JES:
You suggest "the grower industry . . . ...JES:<br /><br />You suggest "the grower industry . . . get behind some kind of campaign that markets wine as a whole."<br /><br />Recall the "Got milk?" broadcast television advertising campaign?<br /><br />Guess what.<br /><br />It didn't work.<br /><br />Domestic milk consumption fell despite the ad blitz.<br /><br />"The End of Got Milk?"<br />The New Yorker online - posted February 28, 2014<br /><br />URL: https://www.newyorker.com/business/currency/the-end-of-got-milk<br /><br />Excerpt:<br /><br />"In October of 1993, the California Milk Processor Board, with the help of the advertising agency Goodby, Silverstein & Partners, launched . . . the first of many Got Milk? advertisements, which most often featured celebrities with milk mustaches. Two years later, the Milk Processor Education Program (MilkPEP), the national promotion arm of milk processors like Dean Foods and HP Hood, licensed Got Milk? and distributed it nationwide. By the mid-nineties, ninety-one per cent of adults surveyed in the U.S. were familiar with the campaign.<br /><br />. . .<br /><br />"But there has been a problem: Got Milk? didn’t actually get people to buy more milk. The daily consumption of fluid milk -- as opposed to milk-based products like cheese, yogurt, and butter -- has steadily declined from 0.96 cups per person in 1970 to 0.59 cups in 2011. . . ."<br /><br />. . .<br /><br />"As of Monday [February 24, 2014?], the Got Milk? campaign is pretty much dead. . . ."Bob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-16466486101238158432019-09-03T16:15:36.542-07:002019-09-03T16:15:36.542-07:00From National Public Radio (aired August 14, 2019)...From National Public Radio (aired August 14, 2019):<br /><br />"California's Largest Legal Weed Farms Face Conflict In Wine Country"<br /><br />URL: https://www.npr.org/2019/08/14/747441997/californias-largest-legal-weed-farms-face-conflict-in-wine-country<br /><br />Subject: a fungicide sprayed on wine grapes -- if it drifts onto nearby planted cannabis -- makes the latter unfit for sale, as state law precludes cannabis having any trace of fungicide or pesticide in it.<br /><br />Link to state law guideline chart:<br /><br />https://bcc.ca.gov/about_us/documents/17-261_required_testing_chart.pdf<br /><br />If you as a vineyard owner pivot to growing cannabis, your crop can be ruined by your wine grape growing neighbor's fungicide spraying.Bob Henryhttps://www.blogger.com/profile/02089688073031173053noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-33559475655647180722019-09-03T14:40:12.050-07:002019-09-03T14:40:12.050-07:00Tercero - thank you for your post.
I actually thi...Tercero - thank you for your post.<br /><br />I actually think that the Wine Group and Gallo will do all they need to to help build the category. It's to their advantage. If you read the press release from Gallo on the Constellation brand acquisition, there is a single line from Joe Gallo that says something to the effect that "they want to build the category." The Wine Group had an announcement earlier this year that talked about $300M going to rebranding Franzia. <br /><br />Gallo has always been an excellent category builder. I expect they will do just that again and be a huge help at the end.Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.com