Tag Archives: Wine Trends

Sign, Sign, Everywhere a Sign!

122110calvin_resolutions

Calvin & Hobbes – Bill Waterson, Copyright – Andrews McMeel Publishing

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.

Sources

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.

Solutions

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!

 

 

Comments Off on Sign, Sign, Everywhere a Sign!

Filed under Wine Collecting, Wine Education, Wine Industry, Wine Marketing

1984/1985 Napa Vintages: Comparative Blind Tasting

Recently, I attended a single-blind* tasting with a group of wine collectors whom I regularly meet to share interesting wine. While it has lately become popular to bash the direction of Napa reds and the influence of Robert Parker on the Napa wine industry, here was a chance to evaluate the longevity of Napa wines, BEFORE the wine style began to change. I will try to walk you thru the mindset of a single-blind tasting and wine evaluation. Hopefully, you will find it interesting. Hitch-up your britches, pour a glass of wine and let’s git after it…

(*”Single-blind” is the term used when you are provided with only general information, say: growing region and vintage, or Bordeaux blend and cool climate vineyard. With a minimum of information for context, you must then determine as much about the wine as possible, such as: grape varietal(s), winery – maybe even winemaker, etc. “Double-blind” tasting would include no information about the wine prior to tasting.)

Starter

I always enjoy starting a wine evening off with bubbly, but 1983 Dom Perignon? What a start to a great evening. The Dom still had medium+ acidity, was well balanced, but had moved beyond nutty to more of a brown butter component. The age on the wine gave it a beautiful texture. For those who have not drunk aged Champagne, the texture can be so gorgeous, it is worth tasting for the mouthfeel alone. The young Veuve Clicquot was bright and bracing as it should be.

The Cat (Wine) is Out of the Bag

Out of the bag quite literally… Here are the pics of the bottles out of their paper bags, after we wrote our tasting notes and had attempted to select which bottles matched which producer. Our host served charcuterie, bread and some beautiful pate I really enjoyed to clear/accompany the palate.

1974 Robert Mondavi Reserve Cabernet Sauvignon

Very balanced wine, but reaching its limit. Still with medium acidity and medium-minus tannins, this drank reasonably well, but the oxidation had taken over the fruit and was a few years beyond its drinking window. The fruit had moved to more prune and raisin, than fresh fruit flavors. This would have drunk better at around 35 years of age, around 10 years ago. The brownish color around the rim and prune flavors gave it away, almost all of us identified this wine correctly.

1984 Diamond Creek Vineyard Volcanic Hill Cabernet Sauvignon

This wine still had strong tannins. It was a little watery with a very restrained nose and palate. Diamond Mountain region wines in the past have tasted big, tannic, with subdued fruit and without much nuance (IMO)… but with age, developed great mouthfeel. Exactly how this wine tasted. This was an easy tell, with some tasting history to reference.

1985 Silver Oak Alexander Valley (Sonoma) Cabernet Sauvignon

This was the fruitiest of the bunch and had the most obvious oak.  This was the surprise of the evening (IMO). Recent vintages of Silver Oak Cab Sauv are not generally viewed as being able to stand up to extended aging, but this 80’s era vintage was balanced and still fruity. A nice wine with tremendous character for 30+ years of age. With the most obvious oak on the nose and palate, this fit the Silver Oak tasting profile, making for a high probability of accuracy.

1984 Beaulieu Vineyard Georges de Latour Private Reserve Cabernet Sauvignon

I mistook the next two for each other. I have always had an odd relationship with BV as a producer. I have not really cared for their lower priced wines, having only a minimum of value (IMO), while their famous Georges de Latour release every year is good, but over-priced. They also seem to develop complex flavors in their higher priced wine, some flavors of which I don’t care for. So, I may have gone into this tasting with preconceived notions… which is always an interesting aspect of blind tasting. I guessed this wine was the Joseph Phelps, mostly because I enjoyed this wine as having the most balanced profile of the wines tasted and having the most gorgeous mouthfeel. Frankly, I didn’t think a BV wine could be this good. (buzzer sound) Well, I blew that one! Chalk one up for having a closed mind.

1985 Joseph Phelps Backus Vineyard Cabernet Sauvignon

I described this one in my notes with the typical wine industry generic term, “food friendly”. The kiss of the death for uninteresting wine in a tasting note in the U.S. This was the most acidic of the bunch. Which was amazing, since this wine was 33 years old. It was a little vegetal with a touch of tomato, but no green bell pepper… both characteristics of under-ripe Cab Sauv. Hard to believe this wine was from a warm vintage. This could only happen in a Napa vintage before 1995. No self-respecting Napa producer would ever harvest Cab this early in a warm year today. I enjoyed this wine the least of the bunch. Poor balance and “interesting”, but not particularly pleasant flavor profile.

1988 Lynch Bages Bordeaux Blend

This was smokey, with medium+ acidity and medium tannin. This was another example of an aged Bordeaux showing balance after extended aging. The flavor profile included an earthiness, that when you taste enough of 1st-5th growth Bordeaux wine, you come to recognize. Still with fresh fruit (blackberry) and stewed currants, the fruit was forward on the palate. I am not a huge fan of Pauillac region wines. I prefer the St. Estephe and Margaux regions in Bordeaux, but this was drinking nicely at 30 years and was a strong representative of Left Bank Bordeaux.

The Finish

IMG Port Btl

Just WOW!

This aged, vintage port was exceptional! The fruit had lasted very well. Not too sweet, tasting like a more recent vintage… but for a port, this wine was so balanced… integrated alcohol, good acidity, soft & full mouthfeel. All of us agreed, this was the outstanding wine of the evening. I wish I could hold on to ports this long. This one was worth the wait.

Recap

Well, there you have it. A great evening! I hope you enjoyed the personal perspective and found insight into blind tasting methodology. I think you can see, blind tasting accuracy is mostly: having tasted a lot of wine labels and being able to hold them in your memory. These were all exceptional wines, wines I would score from 90-99 on the Parker scale. We definitely proved the point, most collectors can easily identify Bordeaux in a line-up of Napa Cabs. All of us guessed the Lynch Bages correctly.

Napa Cab Sauv: Now & Back Then

Not many are allowed the opportunity to taste a selection of Napa Cabs from the 70’s & 80’s. This was a great experience. I will reiterate comments made before about Napa in the last 30+ years… Prior to 1995 Napa made true Bordeaux style wines: structured, leaner, lower alcohol and well-suited for extended aging. 1995 to 2003 was an interim period, where Napa Cabs were fruitier and more ripe than before, but still able to handle 10-20 years in the bottle. 2004 and after, most of the wine was produced for optimum drinking windows in the 5-10 year range. This is just a gross generality. There are individual exceptions with both shorter and longer aging windows, but in general, I have found this evaluation to hold true.

Happy Thanksgiving everyone!

1 Comment

Filed under Alexander Valley, Bordeaux, Bordeaux/Meritage Blend, French Wine, Napa Valley, Sonoma County, U.S. Wines by Region, Wine by Varietal, Wine Collecting, Wine Education, Wine Tasting, Wine Tasting Notes

Trends Changing the Wine Industry

GallowinetrendsMillennials

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.

TRENDS

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…

5 Comments

Filed under Wine Education, Wine Industry, Wine Marketing, Wine Tasting

2014 Napa–Sonoma Winemaking Trends

'I'm not putting it out. There's enough oak in this Chardonnay to keep this fire going all night.'

Source Material

I have interviewed 12 winemakers from the area by phone and in-person over the past few months.  Many have been from very well-known, high-profile producers. The material has provided a few new perspectives.  Some of these observations may only apply to estate wineries where there is more control over wine growing strategies, while others are specific to the winemaking.  I will not compare individual winemakers, or wineries.  It would be an injustice to each of them.  Although, I will be making an effort to tell each of their stories in separate pieces later.

Recent Winemaking Trends in Premium Wines

More Block Harvesting and Corresponding Small Lot Fermentation

I am running into this strategy at more estate wineries and if they are not already doing it, they are thinking about it.  Separately fermenting smaller, individually harvested, vineyard lots is happening more in this region than ever before.  Wineries are making a major investment in large numbers of smaller fermentation tanks, moving away from the full harvest approach and much larger tanks.  This trend is allowing winemakers to more effectively capture the individual character of fruit grown within differing micro-terroirs in individually fermented batch lots used for later blending.

Impact on the Wine –  Improved complexity and structure. Isolating individual characteristics from the fruit to bring a greater sense of unique “place” to the wine.

Winemakers Exerting Greater Influence on Viticulture

Estate Winemakers are insisting on more input into the decisions in the vineyard.  They are investigating different micro-climates and soil types on a much smaller scale than ever before.  This trend is increasing their influence with viticultural decisions that affect the final product such as:  separate farming and harvesting of individual vineyard blocks, row orientation, irrigation and pruning strategies (or lack of), etc.

Impact on the Wine – Better planning to accommodate vintage variation.  Ability to experiment with vineyard practices that can compliment the style of wine being made.

Varying the Harvest Timing with Small Block Harvesting

This is a bit controversial, but I am hearing it being discussed more.  Harvest timing is one of the major decisions affecting the wine.  It can effect tannins, acidity and phenolics… blending individual lots harvested at different times can change many characteristics of the final product, for example:

  • Tannins – Earlier harvest can make tannins more rustic.  Also, the ripeness of the pips can have a huge impact on the texture of the tannins (dusty, grainy, rounder, etc.).
  • Acidity – Earlier harvest can often provide increased acidity.
  • Phenolics – This is the touchy-feely area of this practice.  Identifying the preferred level of phenolic development is as much art, as science, but there is no doubt ripeness affects this category too.
  • Sugar – Harvest timing will effect the amount of sugars in the juice.

Impact on the Wine – Virtually all aspects of the wine’s character are potentially affected by this.

Less Interaction with the Wine During Production

This philosophy is leading to experimentation. Here are a few techniques that are being used, or discussed more frequently:

  • More wineries are moving to automated pump-over closed tank fermentation, versus open container punch-down.  Some industry folk say punch-down “shocks” the wine.  I have been paying closer attention to this in the past year, after seeing its widespread use during a trip to Italian wine country last year.
  • Lots of discussion going on regarding the need for extended cold-soak prior to ferment to extract color.
  • More natural yeast fermentation, instead of inoculation.
  • Lighter pressing of the fruit. One winemaker talked of just using gravity to press the first-run juice.
  • Skipping removal of the lees after ferment and waiting until a later date to separate the wine.
  • Controlling temperature to slow down the duration of the ferment.
  • Less fining and filtering, which reduces the amount of pumping and moving of the wine.

Impact on the Wine – The intangibles seem to be most affected by this approach.  These techniques may soften the attack of the wine, add elegance and affect mouth-feel.

Extended Maceration for Red Wine

This relates to extending the contact of the wine with the skins and sometimes the lees and/or stems. I actually spoke to one winemaker that talked of 60 days for ferment and maceration.  The more traditional thinking is 10-15 days…  This is expensive for wineries.  It requires either investment in more fermentation tanks, or reducing capacity for production.  Several winemakers spoke of wanting to experiment with this for whites too.

Impact on the Wine – Differing opinions on this, but for my palate, it changes the character of the tannins substantially and at the same time adds complexity.  I am not sure there is more extraction, but it definitely affects the texture.

Whole Cluster Fermentation for Red Wine

This technique requires using the whole grape cluster (stems and all) for the ferment, rather than the usual de-stemmed berries.  Almost all winemakers I talked to were including a percentage of their blend with wine fermented this way.  Several winemakers claimed that a whole cluster ferment by definition will add natural carbonic maceration to the mix.  Some of these wines do appear to be more aromatic…

Impact on the Wine – It may add more of a mid-palate to some wines.  Often, these wines seem to have a fresher, fruitier character (carbonic maceration?).  Bottom line, these wines ARE more complex, but better complex?  Some winemakers claim it has much to do with the terroir.  Apparently, some terroirs do not produce fruit that works well with this process.

Focus on Balance

Ah, the holy grail of wine!  For so many years Napa producers have been known for their big, extracted, high alcohol cabs.  I think the pendulum is finally starting to swing back a bit.  While these producers will never move back to the true French Bordeaux style, more winemakers are talking of balance and I am starting to taste it in more Napa wines.  A beautiful trend!

Conclusion

It is so good to see sophisticated wine palates (winemakers) changing the decisions being made in the vineyard.  While vineyard management is certainly farming, having a trained palate influencing the approach for each individual block and making adjustments for each vintage… is a very, very good thing for the industry.

Many of these techniques and ideas have been around the industry a very long time, but tend to be newly adopted in areas of California.  To be fair, not all winemakers are fans of this direction and produce fantastic wines anyway.  A clear indication of how much there is still to learn, about growing and making wine.

Why are following these trends important?

  • For Wine Enthusiasts – It may help you:
    • Identify techniques that produce wines you prefer
    • Build a dialogue with your favorite wineries
    • Understanding a winery’s approach, may help you to understand which labels match your palate
  • For Industry Professionals – Understanding how influential wine producing regions are changing their thinking is important to:
    • Wine pairing decisions
    • Building context for a strategy to develop a commercial wine list representative of a broad range of styles
    • A glimpse into the future of where the industry is headed

 

P.S. – I hope folks are enjoying these kind of pieces.  I don’t see much written that tries to make the technical more accessible and relevant to the public audience.    HAPPY HOLIDAYS AND BEST WISHES TO YOU AND YOUR FAMILIES!

1 Comment

Filed under Wine Education, Wine Industry, Winemaker Interview