The Scourge of Tourism Circa 1972

Is tourism a problem? It depends who you ask, but it's impact has been feared and debated for a very long time as an issue. Even way back in 1972 when many of us were still living life in black and white, and cable was part of your corduroys instead of your TV, tourism's impact in the Napa Valley was being reviewed and questioned. 

Some things have have remained the same today but the narrator in the above news piece offered an interesting view into tasting rooms of the day when he said tourism was "important to PR, and to a lesser extent, sales." 

You see, tasting rooms back in the day weren't put in place to sell wine. That's what distributors did. Tasting rooms were nice-to-haves. My how those days have changed!

Today tasting rooms and tourism are linked to the survival of family wineries. Direct sales represent 60% of an average winery's sales, and tourism is the lifeblood of the family winery. Without tourism and direct sales, I'd make an educated guess that 60% of the wine business as we know it would fail.

Picking A Side In the Napa Winery Fight

No it's not Monday when I normally post. I got inspired midweek from Tom Wark who wrote a piece yesterday in his Fermentation Daily Wine Blog entitled Critics of the Napa Valley Wine Industry are Losing Badly. It's a passionate opinion piece of the goings-on in Napa County politics which are overheated with rhetoric. (Rhetoric | rhet·o·ric \ˈre-tə-rik\: language that is intended to influence people and that may not be honest or reasonable.)

What? Locals Overwhelmingly LIKE the Wine Industry

      Doesn't Everyone Hate The Wine Business?

While Napa is the current poster child for the debate, whether Sonoma, Santa Barbara, Oregon, Virginia, Paso Robles, or the San Joaquin Valley - the wine business has received it's share of public scrutiny the past few years in local press. While "wine country" is viewed by many as an idyllic place to live or retire .... certainly so if you read listings from local real estate agents, that view isn't shared by a non-homogenous mix of anti-winery folks in what is now being labeled in an on-going story of the greedy and detached winery owners and growers versus their communities.

Wine Distributors: Legalized Pot vs Prohibition

 

Thirty-seven states have liberalized the 1970 Federal Controlled Substance Act with respect to marijuana use. Thirty-five now allow medical marijuana. Two states; Colorado and Washington have fully legalized recreational and medical marijuana use. Oregon, Alaska, and Washington D.C. are expected to do so in 2014.

 

Two weeks ago I spoke to a large group of high-level sales people and distributors. I enjoy talking to this particular group because I get real-time unfiltered intelligence from very experienced business people. Outside of all the expected discussion of supply, demand, sales tactics, competition, pricing and the like, there was a surprise discussion on the impact of legalized marijuana on wine sales.

Anti-Winery Sentiment is Building

 

The Winter of Our Public Discontent

 

 

John Steinbeck

Consistent with the farming traditions of the past, the wine business has long been known for its collegial, collaborative, and giving ways. There are always exceptions but people in the wine business historically have worked together for the common good of all.

What Percent of Tasting Room Visitors Buy Nothing?

Ridding the World of Melon Squeezers

Melon Squeeezers

One dark and stormy night (yes I used that one) ...early in my banking career in Mendocino County, I attended an internal banking event where Jim Miscol; one of our senior executives would speak. He told us what a great job we were all doing then asked us to help change the culture of the Bank. He said we needed to "get rid of melon squeezers." What in the heck was he talking about? I had no idea where he was going but my mind started racing to possibilities.

He went on to explain his comment by talking about a grocery store he banked in a retirement community. The store was carrying too large of a waste/spoilage factor in the produce section. As it turned out, the store had evolved into a social gathering place for seniors who would walk the isles with an RC Cola, freely sampling grapes and nuts like it was a smorgasbord, and squeezing melons and peaches while talking to friends. It was the analog prequel to SeniorMatch.com. The store owner was at a loss on how to address the problem without chasing away his customers. How would you handle that situation?

How Much Do Tasting Rooms Make?

I had a good meeting with one of my longest tenured clients this past month. We were talking over strategy and the discussion evolved to discussing their tasting room. Specifically, they don't have one - so should they?

My client is in a region where there is an agglomeration of tasting rooms. The winery is doing well without one. A little off the beaten path, if they did put one in they would need to develop some strategies to get people to the winery.

Wanting to hone in on a measure of expected return in their planning, they asked me what's the ROI of a successful tasting room? I could have given them the stock answer and talked about measures of profitability, but the reality is there is no such thing as an average ROI on a tasting room. If fact you are missing the point of a tasting room if success for you is defined as profit.

How Much Value is there in Wine Tourism?

Many in business view another competitor moving into your territory as an affront to all that is fair and decent. Its the moral equivalent of "I was here first." Sometimes that kind of in-your-face competition is truly a net sum zero game. For example, there was a small drive-thru coffee station in the shopping center I frequent, but one day Peat's Coffee moved in. They survived about a year but now the drive-thru is closed. There are plenty of examples just like that but other times, competitors and related businesses cooperating together can have a positive impact on business conditions and instead of waring, can come together and win together.