Tag Archives: Wine Industry
At the risk of upsetting every wine critic/judge out there, I set out to create a wine scoring system that matched my view of fine wine. I will include this scoring template at the end of the article, for those that might be like-minded. Email me if you would like a self-calculating spreadsheet copy.
After pro Sommelier training (where scoring was discouraged), I was exposed to the WSET scoring method and wine judging courses. Both used a variation of the UC Davis 20 Point Scoring System. I was shocked how these systems were unable to separate amateur from premium wines effectively. In these classes, we scored fruit wines (cherry, blueberry, strawberry, etc.) and vitis labrusca wines (Concord, Chambourcin, Catawba, etc.). These wines were near undrinkable for me and were being given the same scores as mediocre Cali Cabernet. The methodology and scoring systems taught in these classes were intended to be appropriate for both amateur and fine wines. Although, away from class these same people would explain the intent of these systems was to score wines based on a comparison of LIKE wines. This is not how I understood the training and it is likely the public views this scoring similarly. This experience motivated me to build a scoring system that is weighted properly and could be used to provide comparatively accurate scores for amateur, professional AND fine wines, without a bias.
The Evaluation Criteria
First, it was necessary to determine what separates fine wine, from other wines. In that evaluation, I arrived at the following characteristics that are under-represented in the UC Davis System: Balance, Complexity, Finish and Aging Potential. All of these measures are intended to be scored in the UC Davis “Quality” category, but to make the scores more comparatively accurate, I decided these characteristics needed their own point categories. I then looked at what seemed to be weighted incorrectly in the UC Davis System and arrived at: Clarity, Color and Acidity. Four of twenty points for clarity and color is 20% of the score. This is weighted too heavily towards mediocre wines. Acidity was only 5% of the score – not weighted heavily enough. I realized, if I reduced the points for clarity and color, increased points for acidity and added balance, complexity, finish and aging potential categories… I might be able to devise a scoring system that could properly measure a Concord wine (for example) and build an appropriate score against say… an aged Bordeaux Gran Cru.
A Wine Scoring Template
Now I was ready to put my scoring template together. I realized that many media outlets still use the old Robert Parker 100 pt system and decided to add it to my template. I wanted to help both systems arrive at a roughly equivalent score. I realized this could only be done, if I started the 100 pt score at 50, instead of 0. You will see what I mean below. The closer the wine came to the premium category, the better my 100 pt method seemed to arrive at an accurate score. It was the opposite with my 20 pt method, albeit much closer to reality than the UC Davis 20 pt method.
After the long explanation, here is my effort to build a scoring system that can evaluate both a poor blueberry wine and a Gran Cru Bordeaux – with the same template – done accurately and with a logical systematic approach.
In the past, my Somm training won out and I tried not to add scores to my tasting notes. In retrospect, I think this was mostly due to being uncomfortable with the systems available. I intend to use my scoring template moving forward and hopefully develop consistency and comparative accuracy across my tasting notes.
I would be very interested in other opinions regarding both the thinking that drove this creative process AND the relative accuracy using this scoring system. I am also open to modifying aspects, if the changes fit within the logic model used to build it. Please feel free to leave your comments on this page. Thanks!
This is an important topic and a good article from the “A Matter of Taste” site on the topic. If you are a wine enthusiast, it might be something to consider for future purchases. If you are interested, use the link to access the website here:
European Wines vs. U.S.
This issue highlights the local AVA, DOCG, AOC (etc.) regulations/laws. Some of the typical U.S. additives are not permitted in much of Europe: chaptalization, acidifying and fining agents, etc. The chemical additives category may be an even more important topic of discussion. I have found generally, I NEVER get headaches from French/Italian fine wines. Hit or miss with U.S. product.
What is your experience? Do you think it could be additives? If so, the only option to change this, is speak with your dollars. When visiting tasting rooms and talking to retailers, ask about additives. If you can’t obtain the info, consider that in your buying decision. I am a huge proponent of listing ingredients on wine labels. If you just can’t part from your faves, consider one of the several wine filtering utensils available in the aftermarket… but consider these too. Could they be using chemical agents to filter the wine? Happy wine hunting!
I am not the only one seeing the changing face of the U.S. wine industry and the industry resistance to any kind of meaningful response.
Wine-Searcher just posted an article regarding a recent wine symposium where the topic of conversation has been adjusting to the changing market. See my previous article at this link: Trends Changing the Wine Industry and the Wine-Searcher article at this link: Gloomy Outlook for Small Wineries.
Can Small Wineries Survive the Changes?
Here are the data points changing the face of the wine industry with limited response by producers (the numbers across multiple sources had some variation, so the figures below are approximate):
- 90% of all wine made in the U.S. is sold by the 320 wineries that exceed 50,000 cases of production. Of that 90%, more than half is dominated by the top FIVE: Gallo, Wine Group, Constellation, Trinchero and Delicato. The other 9,000+ wineries are bringing only 10% of all wine production to market in the U.S.**
- With the recent on-going consolidation in wine distribution, the top FOUR by volume nationally (Southern, Republic, Breakthru & Young’s) deliver approximately 60% of all wine distributed in the U.S., but represent only 30% of the wineries.**
- In the case of wineries producing fewer than 10,000 cases, distributors were responsible for only 33% of sales in 2016. A 6% decrease over the previous year and the trend is continuing.**
Is your head swimming with numbers yet? Suffice to say, BIG has become financially BETTER today and could very well push SMALL to the side of the road. Why? The answer is in the numbers above. How do those other 70% of under-represented wineries bring their wine to market? Winery Direct-to-Consumer (DtC) sales is only 2% of all wine sold in the U.S. currently.
Small wineries better become experts at marketing, capturing clientele and earning their continuing loyalty… and fast! If they do not already have a developed DtC customer base, it is near too late. Those who wish to survive, should be investing now! The large distributors dominating the market already have large portfolios of wine labels and shelf-space and wine lists only have so much room.
There were two great hopes: the loosening of rules in cross-state shipping of wine allowing the emergence of online wine retailers and the advent of wine big-box retailers (think Total Wine). At one time, it was looking like these two channels buying winery-direct could represent small wineries and fill the gap. Although just like the DtC space, they are missing the expertise to deliver the volume of sales needed. Can online retailers get better at building inviting online platforms and tools to identify and explore the consumer palate? Can big-box retailers provide a better buying experience that allows thousands of labels to be properly represented? Unfortunately recently, wine commerce laws have become stricter (see recent changes in FL) and it is making it more challenging for both of these channels to grow fast enough to fill the gap.
Why Should Consumers Care?
Well, if you have favorite wines produced by wineries with under a 10K case output… supporting them with your DtC purchases will become important to their continued survival and your continuing supply. It is that simple. The survival of small wineries is in your hands…
**Reference sources for this article were: Various Wines & Vines articles, Grand View Research – Wine Market Trends Report, Forbes Food & Agriculture articles, L.E.K. Insights – Trends Affecting the Wine Industry, Dr. Liz Thach MW – Blog and Statista – Alcoholic Beverage Statistics. The internet provides so much rich content, if you search!
Silicon Valley Bank has been producing state of the beverage industry reports for years. I try to make sure I read the formal report every year, but they also write a blog for the wine industry that I check-in on occasionally. The data can deliver insights that bring an interesting perspective to market trends.
Data is Predicting Changes
The U.S. wine industry has been on a steam roller building big gains in revenue and beverage market share drawing in new consumers from younger generations of social drinkers. The recent data is showing significant slowing of that growth, even in areas that have been hot in the past, such as: Napa Cabernet Sauvignon, Super Premium Wines, Direct-to-Consumer Sales and On-Premises (restaurant) Consumption. Unfortunately, the growth in the number of small growers and producers is not slowing to match pace. Many of these producers are being drawn to the lifestyle, not the business opportunity and the industry is reaching a tipping point for several reasons.
Restaurant Wine Sales is Slowing
Distribution is their own worst enemy here. In an effort to control local beverage markets, they are actually causing irreparable harm to their dealer’s ability to respond to market trends. Destructive strategies, such as:
- Withholding well-known brands of beer and spirits, if specific high-profit wines being promoted are not purchased.
- Extending credit limits, or terms to obtain leverage on buying decisions.
A successful restaurant wine inventory should have wines covering well-known lower priced labels, lesser-known value in the middle range and highly scored, high priced wine that garner recognition. This approach tends to satisfy a much wider range of consumer, offer a selection all can explore/enjoy/afford and provide up-sell opportunities for the staff when the occasion calls for it. Instead, distributors in many states are preventing this type of responsive approach. Read the piece at this link for additional info: Restaurant Wine Sales
Fruit/Wine Supply Exceeding Demand
Wine travel in Europe teaches you one thing: don’t be afraid to order cheap table wine with a meal there. Even table wine in Europe can be very good. The growing over-supply issue may change the landscape in the U.S. For many years now, the $10-15/btl retail price has delivered poor quality in the U.S. I am hoping this market trend will bring more, better quality fruit and wine to the market at reduced prices, instead of vineyards dropping the excess fruit to rot in the fields. See information on this at this link: Wine Supply
Premium Wine Sales are Flat
The continued growth in this category is coming primarily from price increases, not the volume of wine. Interestingly enough, consumption of premium craft beer has also weakened. This is very likely being caused by an aging Boomer generation drinking less wine, without Millennials filling the gap. The younger generation seems to be moving towards exploration and looking for value, rather than committing to older high-priced labels. See information on this at this link: Premium Wine Sales
Direct-to-Consumer Beverage Sales Continues to Grow
As long as State legislatures and the Supreme Court continue to keep their hands off this segment of wine/beer/spirits distribution… this will likely be the savior of the small producer… for those that get it right. With the extensive consolidation in the beverage distribution industry in the last few years, there is just not enough room on the shelf for the growing number of labels, especially for smaller producers without a sizable marketing budget. The continuing growth in the number of small producers will force an understanding of how to connect and maintain a relationship with a clientele, or fail. Wineries must continue to move towards improving the wine experience for potential customers, rather than provide a traditional tasting room as the only engagement. This is the only segment left in the wine industry that offers a solid business opportunity, but selling out each vintage will increasingly become a challenge, without the bulk purchasing distribution can offer. The trick will be how to build the DtC channel for each producer. With most small wineries being about the farming, or the winemaking… there will need to be a newly developed understanding of marketing and customer engagement. It will be a matter of survival. See information on this at this link: Small Winery Sales
Changes are Coming
The U.S. wine industry is likely to look quite different five years from now. There is a good chance, with the Millennial penchant for exploring new wines, that imported wine sales will grow faster than domestic in the future. This pressure may actually force the U.S. wine industry to get better at producing quality in that $10-15/btl range that typically does not exist today. An outcome I am looking forward to…
All aspects of the beverage industry are working so hard to leverage technology, online social media and media access… the efforts are humorous at times. Often I feel bombarded by recommendations from the wine industry: in person, in writing, by software, on websites.
How Do They Know What I Will Enjoy?
We now have apps for retailers, apps for consumers, apps for wineries, apps for restaurants, etc… all designed to help either respond to demand, create demand, or convince me which wines to buy. I am so tired of this deluge of software telling me what I should know about the beverage market/industry, or what I should be buying. If this software can attract enough participation, a database can be developed to identify popular flavor profiles, but how does this really help me? Do I really need to know what the other guy is buying?
I get so frustrated with wine stewards, tasting room attendants, retail clerks AND apps wanting to tell me what beverage is popular, because I am sure to enjoy it. Since when am I sure to appreciate a beverage, because it appeals to the next guy? I don’t need more sources telling me what other people prefer, I need more direct assistance leveraging my preferences to select beverages I KNOW I will enjoy.
The wine industry makes the wrong assumption. I don’t need to be told what to buy, I need an understanding of the actual tasting experience with the product. I need an app that I can input my data: likes wine with high acidity, texture, complex flavors, fruit forward… and it pops out matching wines. It could be for Bourbon too: caramel, butterscotch, vanilla, a little spicy, not too sweet and not too hot… and I get a list. This is where technology could actually pair demand with production and offer both buyer assistance AND seller demand creation.
Why Isn’t Anyone Working on This?
I have been asked to look at/test run several wine apps. Most all depend on sharing consumption trends. The ones that try to do it the right way, all get it wrong, i.e. just because I enjoy black coffee, doesn’t mean I will appreciate savory flavors in wine. I am going to put it out there in the public domain, the questions needed to structure a questionnaire that captures real wine preferences:
- Prefer wine with/without food?
- Drinking the wine now, or holding in your cellar?
- Easy drinking, slightly sweet wines?
- Wines that clear your palate and are crisp?
- Textured wines with good mouthfeel?
- Can you appreciate savory flavors in wine (complexity)? Must a wine be very fruity to appreciate?
- Do you prefer reds with red, or black fruit flavors? Whites with citrus, tropical, or stone fruit flavors?
- How much dry/cottony feeling in the mouth can you appreciate?
- What is your budget?
Let me ask these questions of a wine enthusiast and I can pick out a wine they will enjoy 9 out of 10 times. I have done this with friends so many times… So why is that so hard to design software around? Picture a wine app that is loaded on a tablet that could assist an attendant to make a recommendation based on these simple questions?
If you have simple questions that can provide insight into wine preferences, please share.
***** I will put the challenge out there. If there is a wine app that handles wine evaluation in this fashion, please contact me. I will promote your solution anywhere I can. *****
Premium Branding and Targeted Marketing
I try to spend time occasionally researching wine consumption and how those trends affect the industry. Along that line, a couple of media items came to my attention this week. This article published by Beverage Dynamics on current wine trends at – https://bit.ly/2JZ1cjp and the NPR Radio program regarding the history of Grey Goose brand Vodka and Jagermeister brand liqueur at – https://n.pr/2Fk3ZEg. Take a look for some background, or just follow along below. I will do my best to take you through the impressions this left with me that caused my view of wine marketing to veer in a very different direction.
2017 Wine Trends
This Beverage Dynamics piece lists: the largest selling wine labels in U.S. by volume, their growth in the last year and the fastest growing labels coming up. So, I am reading through this piece and it occurs to me – with over a 600 bottle personal cellar, I don’t have one bottle of any of the labels mentioned. Not one! Why is that? I am sure some of these are decent daily-drinking wine. Not everything in our cellar is expensive wine. Why hadn’t I found one of these as a daily-drinker for my enjoyment? Had me thinking. Then I listened to this radio program…
Guerrilla Marketing & Beverage Industry
It appears Sidney Franks (of Grey Goose Vodka fame) was the original mastermind behind the concept of “guerrilla marketing” in the premium beverage business. Relative to the Jagermeister brand, he took a product enjoyed in the USA by old German guys, and gave it a new hip, young and fresh make-over. This very successful re-branding effort was accomplished by sending out young, trendy brand ambassadors to college bars to promote the product face-to-face. Wow! Grass-roots demand generation from the ground up! It is hard to believe such a simple idea built a brand in U.S. with over $500M+ in revenue.
Hang in there with me… So, I am thinking about the wine labels from the Beverage Dynamics piece and I realize, I can’t remember a single piece of advertising regarding these brands! Broadly distributed, high-volume labels don’t register on my radar. Not because I am a snob, just because these wines tend to be homogenized. All much alike – very drinkable, but without much character. I tend to tune out products that I don’t believe will be of interest… there it is: “will be of interest”. How does my brain decide what wine information should be filtered out? Even more interesting, what would it take to grab and hold my interest? Fodder for another piece down the road…
It took me over ten years to find a group of guys that collect classic premium wines in the Phoenix Metro area. It always struck me, why was that so difficult? What organization in the wine industry identifies the individual market segments and brings like-minded consumers together? I was thinking at least one producer would attempt to do this to promote their product and build demand. Nope. Nada. Nothing. How is that possible? I did find an organization a couple of years ago that I thought might be the answer: the American Wine Society, or AWS (http://www.americanwinesociety.org/). It didn’t work out at the time. The chapters in my area were focused on typical, easy drinking, lower price wines. After some investigation, I just lost interest. Then recently I ran into Jay Bileti (an officer at AWS) and he “listened”. The net result was gleaning out of the current membership a few folks whose interests leaned in this direction. Voila!, we had a wine collector’s tasting group. The point is: where is the industry involvement? It is becoming increasingly clear as the baby-boomer generation ages, marketing must become more focused, target specific price categories and connect with consumer interests. Implementing a little of that “Guerrilla” thinking and investing in filling this gap would have a huge impact on label/brand awareness. Add a few smart folks to the mix and you would have the next great Sidney Franks-like story in the wine business!
Wineries & Marketing Investment
The first simple idea would be for wine producers/marketing reps to reach out to consumer organizations like AWS. No, not the way it is done now, but to invest in surveying wine enthusiasts to identify consumer market segments, categorize interests, separate price categories, build palate profiles and associated taste models. THEN, provide services to connect individuals. The best marketing ideas build a COMMUNITY! This is where brand loyalty begins. Right now, none are willing to invest this way, because there is no vision for how to monetize it. This has to be the future for premium brand wine marketing as Boomers age. Just holding local wine tastings and wine dinners is not the full answer. I wonder, what would it take for a few producers to embrace this idea?
Sarcasm Seems Appropriate
Confession: I am a collector of wine. Hmmmm… Yep, the tone works. Lately, I am feeling like I need to apologize to wineries, retailers and distributors for collecting and storing their product. Maybe I need to start a Collector’s Anonymous group? Perhaps, I can develop a 12 step approach to curing my apparent illness and become famous. You may ask yourself, “Why haven’t I heard of this problem?” It has been camouflaged, lurking around the edges of changing demographics and trending demand.
These days, I am feeling the need to justify a collector’s version of wine appreciation. The majority of my wine inventory is 8-15 years old and some as much as 25. As my inventory ages, the enjoyment of complex, textured and elegant wine grows. This wine world I live in, is no longer fashionable to the industry crowd.
$$Another Impact of Changing Demographics$$
Let’s use Napa wineries as an example. 25-30 years ago most major Bordeaux style red wine producers in Napa (Beringer, Mondavi, Montelena, Jos Phelps, etc.) all were producing wines capable of aging 15-30 years (some more). After 2000, those drinking windows started moving and became 10-12 years. The next threshold was crossed about 2014. Now, many of the traditional Napa wines I drink have had drinking windows landing somewhere in a 5-8 year range. I now have to be careful NOT to hold these wines too long. It just goes against my grain to pop $100/btl wine in less than 5 years!
Why should the average wine consumer care? To produce earlier drinking red wines, the style usually requires more time in contact with new American oak, often are more extracted, higher in alcohol and less acidic. In short, easier drinking wines that are appealing to the younger, less experienced palate.
I am now thinking of canceling many of my California wine clubs and moving to more Bordeaux product. Even many Chianti, Chianti Classico and Brunello wineries have succumbed. Barolo and Barbaresco too, but those wines had aging windows of 25-50 years and are now landing at 10-25 years. I can live with that. Too many wineries are relenting to the economic pressure of appealing to the growing Millenial segment that is looking for drink-now wines, even in the luxury price range (over $50/btl). Caymus and Silver Oak are the well-known examples to reference in this category.
Old World Sensibility Matters
Balance, balance and more balance! All this extended cold soak and maceration and barrel aging in New American Oak, ugh! Many red wines are now so heavily extracted, they ruin all but the richest foods. Yes, oak makes the wine rounder and adds pleasing vanilla flavors… It also adds wood and butter in reds (like Chardonnay) and destroys the freshness of the fruit. If you enjoy wine with food, forget it. These wines are so round, they will not cut through accompanying food.
Thank goodness I still have Bordeaux to turn to. Fewer and fewer Napa wineries care about producing a structured, balanced red wine that can age. My wine buying days have not ended yet, just turned to 10 year old red Bordeaux from auction!
I attended a presentation today at the 2017 Wine Bloggers Conference by a group of four Zin winery owners sponsored by ZAP (Zin Advocates & Producers) and heard this plea: we are serious winemakers producing serious wine, we deserve to be taken seriously! The session was titled “Zinfandel: Old and New.” I was expecting a serious discussion about old and new wine styles, but instead we heard the usual tired Zin topic: comparing old vs. young vine Zin. Not that this isn’t a viable topic, it has just been covered many times in many places and not really what these winemakers were passionate about. The ZAP moderator had to focus the discussion back on promoting the vineyards several times. This brings me to the reason for this commentary. I have seen it many times, when a winery doesn’t understand how best to develop a coordinated marketing plan, the focus is put on expression of place (terroir). There are definitely worse ideas, but Zinfandel in particular is a special case. Zinfandel has an identity problem first and foremost and if that isn’t addressed, all discussion of place is lost in the noise.
Red Zinfandel Wine & Consumer Perception
Zinfandel is the most manipulated wine grape on the planet. It is made in so many styles, you really have no idea what to expect every time you open a bottle from an unfamiliar producer. In contrast, when I pop Bordeaux/Meritage, Burgundy, or Rhône style wines, regardless of where they are made, I have a rough idea of what I will be tasting. That is a serious problem. If ZAP is trying to bring Zin into the premium space, they should be focusing on this issue. Collectors and restarauteurs need to have a point of reference. It must be quite difficult to build a marketing plan around a wine profile that is not generally familiar. Does the marketplace need some sort of generally accepted Zin style indicators?
So, here we go… my attempt to address this challenge:
RICH Zinfandel – Characterized by winemaking technique aimed at broad general appeal and high volume production. Usually driven by ideas like: whole cluster vacuum fermentation to add extraction and big fruit flavors, extended cold soak for more extraction, late harvest to accentuate over-ripe and raisiny fruit flavors and optical sorting to isolate late harvest raisins to make a concentrated must used to fortify larger batch production. Good examples would be Lodi and Paso Robles producers chasing the jammy Zin profile.
WARM CLIMATE Zinfandel – These would be producers in warm climate areas with a fine wine sensibility. Using Guyot trellising and vertical shoot positioning to build a Bordeaux style approach to Zin. This type of winemaking in these locations makes what I would call Zin with finesse. Not overly fruit-forward with low tannins and medium to medium-high acidity, often shooting for soft wines with good mouthfeel. Napa and Dry Creek Zin producers would be the example here.
COOL CLIMATE Zinfandel – These producers are trying to build a leaner style Zin with medium to high tannins and high to very high acidity. Often traditionalists, these estate vineyards are usually head-trained and laid out with more space 8’x8’ or 8’x12’ between the vines building a large cluster approach to fruit production. Zin tends to always drive fruity flavor profiles, so growing in a location with just enough sun and warmth to ripen the fruit seems to work. This is probably a “truer” expression of Zin for you purists and builds a wine much better for pairing with food. Producers from Amador and El Dorado Counties and Russian River are examples in this category.
Zinfandel BLEND – This is the newest idea in the industry and popularized by the very successful release of “The Prisoner” by Orin Swift orginally. Zinfandel as a varietal has broken through the stigma and become a more common blending grape. Several producers in Paso Robles have begun using Zin to add a fruit-forward and aromatic character in lieu of the traditional Grenache found in most Rhone blends. I find the result quite interesting. Try an example of a red blend with Zinfandel in the mix. When done well, these wines can be fruit-forward, acidic, tannic and have great mouthfeel all at once.
Wine Tasting Session
2015 Terra d’Oro Deaver Vineyard – Mildly fruit-forward and slightly sour. Much like a Chianti without the structure. Some complexity would add interest. Medium acidity and tannins.
2015 Cedarville Vineyard Zinfandel – A fruit-forward nose and palate with black cherry and strawberry. A light mid-palate and finish of bitter dark chocolate. Medium-high acidity and medium-high tannins. This had a nice aromatic nose. Nice effort that maintains the integrity of the Zin profile, while offering a structured food-friendly approach.
2015 Proulx Zinfandel – A strong red fruit profile with a brambly note and a dominating nail polish character on the nose. Medium-high acidity and medium tannins.
2015 Limerick Lane Wines 1910 Block – This is loosely a Zinfandel “field blend”. More blackberry than the other wines tasted here (more black vs. red fruit). The enhanced black fruit is likely due to the other red varietals planted in this vineyard. There was a brambly character that added a pleasant complexity. High acidity and medium tannins.
Cool Climate Zinfandel
These four wines were grown in areas where at least the evenings are quite cool and the fruit is often picked a little earlier than other California Zin producers. These wine profiles were deliberately built to offer a more classic style of red wine with good structure and to pair well with food. Think food pairings like poultry, or pork – in particular, a Thanksgiving meal sort of sensibility.
How do YOU feel about Zinfandel? It can be made in a very serious wine style, but is not often thought of this way. Marketing is critical for the producers in this style. It was mentioned in the session that these producers were not successfully selling into the Midwest and East Coast markets. The answer has to be an organization like ZAP that could develop a product identity well understood by the wine community.