This weekend I was reminded yet again about how essential it is to identify and understand your target audience. Otherwise our marketing and sales efforts are wasted.
I had three bottles open for tasting, all from XYZin Winery (part of Sonoma County’s Geyser Peak portfolio of wines). Three Zinfandels, two from the 2007 vintage, one from the 2008 vintage.
XYZin promotes itself as “the last word in Zinfandel,” which is pretty clever. But the key to these three wines was that they were XYZin’s “Vine Age Series.” The least expensive was labeled as “10″ (sourced from vines that were at least ten years old when that vintage was made). The next higher in price was labeled as “50″ (sourced from vines that were at least 50 years old when that vintage was made). The most expensive was labeled as “100″ (you can guess what that means).
I thought this was interesting because some of the variables were being controlled (a single varietal, same winemaker, close to the same vintage), allowing a focus on vine age and its impact on wine. This was an interesting comparison for me, and everything about the XYZin positioning and “Vine Age Series” pitch made perfect sense to me. I hope that means I’m in their target audience. I did purchase the wines, after all.
My marketing-communications reminder came in watching how my friends responded to this brand positioning.
One, a university plant scientist, pretty much understood the game right away. He wasn’t so much thinking about the wine as he was the variables presented. He was used to sorting seemingly similar items this way, I think.
Two others, who have been listening to me blather on about old vines and Zinfandel for some months, tracked the positioning pretty closely, picking up nuances as we tasted and talked (the different vintage dates, and new information about the range in retail price ($16 to $45) were “ah-ha” moments).
For the final two, the brand developer and I might as well have been presenting strange native rites in a peculiar English-seeming (but not quite) language. Yes, they understood we were tasting Zinfandel, but why three of them? And what does “vine age” have to do with anything?
One of the great charms of wine, of course, is that even if you don’t understand the details, you can smell it and taste it and say whether or not you like it, what you like about it (or don’t like about it), and why you prefer it (or don’t) when comparing it to other wines in front of you.
That is what we did, and it was valuable and interesting to taste these wines with my friends. And I appreciated the reminder, which Paul Dolan once expressed to me as a caution, “This is as natural to you and me as breathing, but these other people, they feel like they’re under water, holding their breath.”
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No, I don’t mean getting decisions made. We’re pretty good at that. I’m referring to the fact that we often bottle wines with custom corks or screwcaps. While a label might be scraped off a bottle, and a new label applied, it isn’t really practical to pull corks or remove screwcaps, to seal the bottles with a new design.
I’ve been working through sales projections to try and synchronize the release of new Buried Cane labels. It looks like we can figure out everything, including previous decisions about potential products to discontinue, except for about 5,500 cases of Cabernet Sauvignon. An entire vintage already packaged with custom screwcaps … custom “previous design” screwcaps … screwcaps that aren’t compatible with the new label.
Once you release (often, as soon as you announce, well before release) a new package, the old package wine becomes orphaned. Everyone wants “a deal” or refuses to accept old label goods. It doesn’t work to release one item with a new label, without releasing all items with the new label. Therefore, if we release a new package on Chardonnay in the summer of 2011, we better be prepared for the expectation that Cabernet Sauvignon and any other wines will also be released with a newe package in the summer of 2011.
5,500 cases of “old label” is a lot of for us to work through. Particularly if we move our largest single customer, Anthony’s Restaurants, into new label Chardonnay and Cabernet Sauvignon at the same time, in eight or nine months. It could take an additional 18 months beyond that to deplete the “old label” Cabernet Sauvignon, without the sales stream of Anthony’s to help reduce that inventory.
What are the options? Well, it’s pretty clear we can’t keep selling old label goods if all the other wines have changed label. We could keep selling old label, putting that old label on new wines, until we sell through the 2008 Cabernet. That’s a bit difficult, however, when we’ve already shown some customers the new label. It’s one thing to show someone the new label and say, “You can have that next summer.” It’s a very different thing to say, “You can have that new label in a few years.” Most folks won’t sustain interest that long, no matter how great your new packaging.
We could try and sell all that Cabernet at a low price as distressed goods. We’d lose money and risk some brand reputation, if we did that. And, in this case, the wine is quite good, and the subsequent vintages (2009 and 2010) are lower in quantity, so we would end up short of wine.
Or we could relabel. Scrape off the old labels, and put on new ones, and ask the designer how to cope with the non-compatible (image-wise) screwcap. We started that process with the designer today. It looks hopeful, if not perfect.
DAH is David Anthony Hance
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Wineries get many requests to donate their products and participate in wine tastings. The “value exchange” involved is usually this:
The winery contributes its wine, personnel, and (sometimes) money and promotional support;
The tasting organizer delivers an audience of wine drinkers to which the winery may proselytize, attempting to turn members of that audience into contacts and potential customers.
From the winery’s viewpoint (my viewpoint) this value exchange works best when the audience is actually interested in learning about new wines and wineries and includes people likely to purchase wine in a price range that includes our wines. It also works best when we’re the only winery, or one of a fairly select group of wineries.
Here’s a real life example of a wine tasting event that didn’t work for our winery:
A social event for women, part of a national effort, that included wine with other consumer products that might be of interest to women. We were one of three wineries (and we all had to supply our own ice … usually not a good sign for a winery pouring at a tasting event). Tito’s Vodka was also at the event, with a free vodka bar (and the vodka company did have ice supplied by the organizers … also not a good sign for a winery). The vodka bar was very busy all evening. The event organizers were thrilled with the success of their event. We were less thrilled, because while there were many drinkers in attendance, they fell primarily into the “give me another glass … what kind of wine? … whatever” category.
We won’t be doing that event again.
Another recent wine tasting event included more than 100 wineries (not a particularly good sign, for a winery) and beer vendors pouring full glasses at no charge and non-stop (a very bad sign for a winery). Many of the attendees, however, were quite interested in wine, and in our wines (those that stopped at our table to taste). Our cost to participate in the “social event for women,” mentioned above, was probably less than $500 total. Our cost to participate in the “hundred wineries free beer” event was probably $2,500 total.
And we’ll almost certainly do the “hundred wineries free beer” event again. Why?
Because there’s one other reason wineries participate in wine tasting events: Because the organizer is influential or a friend or both. This is probably one of the most important reasons for a winery to agree to participate.
If you read this far, and you’re thinking of putting on a big wine tasting, you’ll get more and better wineries agreeing to participate if you make sure their participation is requested by a well-known media personality or a major retail or restaurant account wine buyer.
Or, focus on smaller events that allow the winery (or small number of wineries) to interact more directly and intimately with potential customers.
DAH is David Anthony Hance
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I was at a tasting the other day, attended by about 100 successful business leaders and their spouses. I was once again reminded that “Chardonnay” means “good white wine” to many of the hoi polloi. Similarly, “Merlot” means “good red wine for my wife/female companion” while “Cabernet” means “good red wine for me.”
While I may say, “I don’t have Chardonnay, but I do have Grenache Blanc,” the response will be “Fine, thanks” and that same person will ask for Chardonnay again the next time they need a taste.
There’s only so much educating one can do, but there’s so much required. Wine knowledge can’t be acquired (or successfully endowed) in a sudden flood. It has to be delivered drop by drop, taste by taste.
And so it is with a sense of place, a generalization for the larger French sense of “terroir.” We need a sense of place and an appreciation of terroir for wines that retail for more than ten dollars a bottle. At ten and below, it just needs to be Chardonnay, Merlot, or Cabernet that tastes OK and has an attractive label. Above ten dollars it needs something more. That something is usually a sense of place, and wine increasingly needs that appreciation of terroir as the retail price climbs.
I’m going to reprint something I just read in THE WEEK magazine, and I’m going to make three points before I reprint it. Then I’ll say no more. I’ll just weep.
1. Concannon makes some nice wines (but none from Napa, so far as I’m aware);
2. Some of Concannon’s vineyards are in Livermore (the city of Livermore is about 63 miles from the city of Napa, at the southern edge of the Napa Valley);
3. Most of Concannon’s grapes come from the Central Coast AVA (more than 100 miles south of the Napa Valley).
From THE WEEK October 22, 2010:
Napa: The valley’s classic wines … Napa Valley buzz too often is about the big estates that win medals for their “high-alcohol fruit bombs,” said John Mariani in Bloomberg.com. But there are still Napa wineries making “austere, traditional wines that deserve wider recognition.” One of them is Concannon, a fourth-generation family vineyard where terroir is the focus.
Sobbing in his weekend wine, DAH is David Anthony Hance
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We plan. We review the plan. We revise the plan. We do our best to organize our forward actions for success. Then it rains, and botrytis sets in, and we’re not making dessert wines.
And the call comes, “What’s the smallest amount of Cabernet we can make this year and still have the plan come out OK?”
Or, “Could you take a look at the plan and let me know what happens if we make no Cabernet this year?”
We’ve had rain in both California and Washington during this harvest season. This harvest season is late, due to a remarkably cool summer. Wet grapes, just as they are reaching necessary sugar levels, and (unfortunately, sometimes) before they have fully ripe flavors, can tend to mildew, mold and fungal growth. This is not good news for most winemakers.
And here’s an interesting confluence of energies, particularly with value-priced wines (those retailing below $20 a bottle, like Adobe, Clayhouse Vineyard, and Buried Cane):
1. We plan production carefully to avoid having excess wine, because the bulk wine market hasn’t been especially lucrative these past few years. This results in smaller standing inventories.
2. We try to accelerate our release dates, so that we bottle and sell wines as soon as possible (as soon as we can offer a high quality wine) after each vintage. This reduces our cost of production on each bottle and case (shorter storage time in the winery), and reduces our standing inventories of bottled goods in warehouses.
3. With tighter inventories, we enter harvest and cope, as best we can, with the additional inventory adjustments that nature forces upon us.
Which all adds up to mean that despite our best efforts to plan and work our plans, we can sometimes plan ourselves into a corner, and lack the wine quantities necessary to sustain our sales business … and selling the wine is the only way we make money.
Thus far, this year (fingers crossed) we feel like we’ve made good decisions, and our precautionary plan adjustments look OK.
But check back with me in a week or so, once we’ve got in all our 2010 fruit. Plans may have changed.
DAH is David Anthony Hance
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I was in a discussion earlier this week about how wineries position themselves, and I worked my way around to thinking there are only three approaches, which are sometimes used in combination with one another.
I was actually confusing the person with whom I was in discussion, until I related what I was talking about to the familiarity of restaurants.
Q: “If you went to In’N'Out Burger and saw they had a turkey sandwich, would you expect that to be their best menu item?”
A: “Of course not. In’N'Out Burger is famous for hamburgers.”
Q: “If you went to a Wolfgang Puck restaurant, would you expect to find Tyler Florence menu items?”
A: “Not if it’s Wolfgang Puck’s restaurant.”
Q: “If you went to Chez Panisse, famous for their use of local and in-season foods, would you be inspired to order a New Zealand lamb dish?”
A: “Chez Panisse wouldn’t even offer that.”
And those are the three ways I believe that wineries position themselves and their brands. Here they are, in wine terms:
WINES OF A SPECIFIC TYPE OR STYLE … The winery positions itself as a Zinfandel specialist, or a sparkling wine producer, or a Burgundian house (Pinot Noir and Chardonnay). They might make other things, or their specific wine type or style might be more esoteric or strange, but you would understand why they are famous. And the Burgundian Pinot Noir producer must be prepared for some questions and clever explaining if they decide to introduce Cabernet Sauvignon under the same label. Because that would be a disconnect with their primary positioning. It’s certainly possible for the winery positioned as a Burgundian Pinot Noir producer to offer Cabernet Sauvignon, but they might find it easier to do under a separate label, or in a different price category.
WINES TIED TO A PERSON OR FAMILY … A famous winemaker, or a large family, or a well-known sports or entertainment or business figure. There are plenty of wineries that are personality based, or family based. They may eventually become well-known for some specific wine, but usually they are branded with the fame or specific traits or skills of a person or persons. I used to work for Fetzer Vineyards, when it was a family operation. We told everyone that the entire family worked in the winery. And everybody expected to meet a Fetzer. I’ve also worked at a winery with a Mike Ditka brand, and all our packaging and promotion was centered on Coach Ditka, and his larger-than-life persona. Bonny Doon is Randall Grahm’s baby, of course. It is often difficult to keep these wineries successful, or to ward off price reductions, when the personalities are removed from the scene.
WINES OF A PLACE … Usually this means an estate vineyard, but it can also be the most famous winery of a region, if there aren’t too many wineries in that region already. Or the pioneer winery of an area. If you have a famous or unusual vineyard, or vineyard area, you can trade on that to create a brand. Near where I live, Edna Valley Vineyards, now a corporately owned winery, trades entirely on its history as a leading winery in its location, the Edna Valley. Norm McKibben and his partners in the Walla Walla Valley were famous for their grapes long before they began a winery. And they named their winery for one of their famous vineyards: Pepper Bridge. These wines of a place are often the most difficult to establish, but can be the most long-lived of brands, because they don’t usually rely on a specific wine type, or a specific personality, to survive and thrive.
Wine type, personality, place … those three elements define wineries and wine brands. Sometimes wineries and brands combine elements of those three. And when you find wineries struggling to tell their story, it’s usually because they aren’t clear about how one or more of these three wine positioning keys fit their operation.
DAH is David Anthony Hance
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I brought home a bottle of VINTJS Central Coast Syrah 2008 the other day.
DAH: I bought this bottle of Syrah to try. I think it might be pretty good, and it was only $6.99.
CHance: Where’s it from? “VINT-what?”
DAH: “Vintages.” But like VINT-TJ’s. It’s from Trader Joe’s.
CHance: Oh, of course. What made you think it would be good?
DAH: The label says “Produced and bottled by Robert N. Lindquist, Santa Maria, CA, USA.” That’s Bob Linquist. He makes Qupe.
CHance: Qupe wines are good.
DAH: Yes, they are.
There are several things I find interesting about this exchange, and other bottles I’ve purchased recently at Trader Joe’s.
First, I think it’s interesting that someone (CHance, my wife) who knows wine (but isn’t completely sodden from swimming non-stop in the sea of the wine business) didn’t immediately understand that VINTJS was a Trader Joe’s proprietary label.
Second, I’m intrigued, as a wine marketer, that respected winemakers and wineries are putting their names on Trader Joe’s proprietary brand back labels. It isn’t every Trader Joe’s brand wine that tells you of its winemaking, but it’s more than I’ve noticed before. Bob Lindquist made this VINTJS Syrah. I’ve been drinking a VINTJS Willamette Valley Pinot Gris made by Joe Dobbes (produced and bottled by Wine by Joe, Dundee, OR). And I recently reviewed a Trader Joe’s Reserve Zinfandel “Vinted and Bottled by Mazzocco Sonoma, Healdsburg, CA” … Mazzocco is part of Wilson Artisan Wineries, a group of wineries owned by Ken and Diane Wilson, who specialize in Sonoma Zinfandel. You can read that Zinsite review HERE.
Do these winemakers WANT their names on Trader Joe’s proprietary wines? Or does Trader Joe’s REQUIRE that their names be attached, as part of the deal? Either way, it adds some cachet, for me, the wine-drenched consumer. It makes the Trader Joe’s wines seem better, and, therefore, an even better deal, price-wise.
There’s still a lot of traditional private label wine out there, at Trader Joe’s and elsewhere. Wine that comes from one of several factory wine bottlers, hidden behind DBAs in Graton or Manteca. It doesn’t mean that wine isn’t good. It could be great. But the marketing of the wine trades only on the value perception and promise of the retailer or restaurant.
Our Middleton Family Wines Buried Cane winery has a “partner label” with Anthony’s Restaurants in the Pacific Northwest. Our regular Buried Cane label carries an additional logo, that of Anthony’s, and the wine is presented as a partner proposition, endorsed by both our companies. This stengthens both our branding efforts (in our opinions). Trader Joe’s is doing somewhat the same thing, when it endorses its proprietary labels with well-known winemaker relationships.
These days, when such a large percentage of the labels found on chain store shelves come from a very small number of very large wine companies, major retailers are looking again at proprietary brands. When they can leverage the reputation of winemakers to sell large quantities of their proprietary brands, they might be very tempted to do so. So, why would a respected winemaker allow their brand reputation to be leveraged in this way? Because it sells a lot of wine, and doesn’t damage their reputation with most consumers (CHance thinks no less of Qupe because she enjoyed a great deal on VINTJS Syrah).
Just think about the money involved. In the most recent issue of Trader Joe’s “Fearless Flyer” newsletter, this is the final paragraph promoting an $8.99 VINTJS Santa Lucia Highlands Monterey Pinot Noir (one of the TJ’s wines that doesn’t identify the winemaker, by the way):
“Sound good? We suggest you hurry in. We have 12,000 cases of this wine, which is about 55 cases per store. When it’s gone; it’s gone.”
That’s about $1.3 million in retail value. Relating to a single SKU at Trader Joe’s. That get’s my attention, wine business-wise.
DAH is David Anthony Hance at VinCreate.com
Share on FacebookOn Friday, October 8, I participated on behalf of Clayhouse Wines in a panel presentation to a visiting group of wine buyers in Paso Robles.
Location: Bistro Laurent (1202 Pine Street, Paso Robles)… a lovely wine-supportive restaurant (local wine favorite) and a long-time Clayhouse account.
Time: 9:30 a.m. winemakers arrive – Guests arrive at 10 a.m. for seminar to begin.
Seminar Title: Paso Robles, The High/Low Split. The goal was to look at quality to value ratio for the Paso Robles AVA at different price points. Each producer showed two wines. One wine is over $25 and the other is under $25.
Lunch was served immediately following the seminar just about 12 noon. Winemakers were invited to join lunch to continue the dialog with the buyers. Lunch wines were delivered in advance: one white or rose wine from each producer to showcase during lunch. We will give these wines to Laurent in advance for menu preparation.
Seminar Panelists and wines:
Mike Sinor, Ancient Peaks
- Zinfandel
- Oyster Ridge
David Hance, Clayhouse
- Malbec
- Show Pony Petite Sirah
Steve Lohr, J. Lohr
- Los Osos Merlot
- Hilltop Cabernet Sauvignon
Jason “JC” Diefenderfer, Hope Family Wines
- Liberty School Cabernet Sauvignon
- Treana Red
There were twelve guests on this three day tour (this seminar and lunch were the tour’s final activities):
1. Lisa Redwine, La Jolla Shores Hotel, San Diego, CA
2. Chris Deegan, NOPA, San Francisco, CA
3. Erin Herendeen Hill, Pebble Beach Company, Pebble Beach, CA
4. Tasha Kuxhausen, Wine Steals, San Diego, CA
5. John Driscoll, Sherlock’s, Atlanta, GA
6. John Hafferty, Bin Ends, Braintree, MA
7. Joseph Yi, Varietal wines & Spirits, New York, NY
8. Colin Husbands, L’ Ete du Vin, Nashville Wine Auction, TN
9. Jake Kosseff, Wild Ginger, Seattle, WA
10. Eric Liedholm, SeaStar Restaurant, Bellevue, WA
11. Joe Crosley, Pennsylvania Liquor Control Board, PA
12. W. Blake Gray – Freelance wine writer based in San Francisco
Why this is such a great brand-building thing: Because we are talking in a friendly focused way to key wine industry professionals on our own turf. By the last day they have a much better understanding of Paso Robles, and we are able to wrap up that sense of place with tastes and talk of some key wines to showcase our region.
While we have to share the time with other wineries, we would never have gained such focused attention when visiting these wine buyers (and writers) in their home towns. When they come to us, distractions are vastly reduced. And when we are competing for attention only with the other wines and winemakers of Paso Robles, our great wines and our superior storytelling have an opportunity to shine.
What worked for Clayhouse, with the three wines we showed:
A. We showed a value priced ($15) Malbec while the other wineries were showing Merlot, Cabernet Sauvignon, and Zinfandel, respectively. Malbec is a “sexier” category at the moment, and I got to explain why a California alternative to Argentina worked.
B. There was a lot of discussion about high alcohols and late picking (one of the buyers was very very very interested in this subject). Our late picked wine (Show Pony Petite Sirah) was still below 15% alcohol, which he thought was OK. We got the big ripeness without the stupid-high alcohol, and won some winemaking kudos.
C. We served our rather rare (tasting room only) Clayhouse Estate 2009 Grenache Blanc at lunch. It was the favorite wine of the day for writer W. Blake Gray. And at both this year’s buyers’ tour seminars (DAH did both, with the same wines and other winery panelists), it was a stand-out for the buyers. Full and crisp, and so unlike Chardonnay or Sauvignon Blanc or Pinot Grigio. It was a great way to talk about Paso Robles, and a great way to say, “Clayhouse is cool.” Even if they can’t have that wine … yet.
DAH is David Anthony Hance
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We’re into the final stages of vetting and evaluating the new Buried Cane label. There’s a multi-step process as we move now towards bottled wine with a label on it:
1. Final comparison between where we are now (the label that looks “old” but is new to us!), and where we came from;
2. Review any packages and concepts that inspired us, and make sure we haven’t slavishly copied them (which could be an embarassment or legal problem down the road);
3. Finalize label copy, wine names, and any other fanciful and mandatory label information (I actually created the first draft of this a couple of weeks ago, but now we’ll apply it to labels for internal review);
4. Make sure the design “works” within our parameters (can we create an acceptable version of the label for our restaurant partner – Anthony’s, can this label be printed without major heartache or expense, can it be applied to bottles without major heartache or expense);
5. Submission to TTB (U.S.Department of the Treasury: Alcohol and Tobacco Tax and Trade Bureau) for label approval (called a COLA – Certificate Of Label Approval);
6. Schedule printing, labeling and relabeling (if we decide to relabel any already labeled goods);
7. Coordinate release dates to the marketplace – BEFORE we tell anyone what those dates might be;
8. Create introductory promotional materials for the new package;
9. Make sure that any old label products have a home, so they don’t interfere with release of the new;
10. Begin a media-relations campaign to explain and enthuse about the new look;
11. Sell more wine!
DAH is David Anthony Hance
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For the past four days we’ve been aggressivley promoting Clayhouse Wines at the inaugural Sunset SAVOR the Central Coast event. Receptions, tours, dinners and tastings have all been part of the fun. We went all out this year, to boost awareness of Clayhouse. Not just with consumers attending the event, but with wineries and all the restaurants that were participating. Nobody could really miss Clayhouse. By making sure that we’re familiar to all, we’ll get more referral business, and more promotional opportunities, because we’ll be a top-of-mind wine.
I had a conversation at the Rhone Rangers booth in the Main Event Marketplace; a conversation that brought me up short and made me think. Talking with two women, both reasonably wine knowledgeable, and one a local who had clearly been to many wine events, had visited many wineries, and was one of those people whose friends look to them for wine advice. For the sake of this post, let’s call her “Ella.” Her non-local but wine-knowledgeable friend is “Nan.” And I’m DAH.
NAN: What do you think are the best wines from around here? Not what your company wants you to say, or what the Rhone Rangers want you to say. What do you think?
DAH: So let’s set aside Clayhouse, the winery I work for.
ELLA: Oh, I like Clayhouse wines.
NAN: Me, too.
DAH: Thanks, we appreciate that. Setting aside Clayhouse, but taking the major wine critics into consideration, I’d have Saxum on my list of best local wineries.
ELLA: You mean Sextant?
DAH: No, Saxum. But Sextant makes some good wines, too.
NAN: I’ve never heard of that, “Saxum.”
ELLA: Me neither.
DAH: They’re really small, and you don’t see their wines around much. They don’t really go to tasting events. You have to get on a waiting list for their annual wine release.
ELLA: Who else?
DAH: Linne Calodo.
NAN: Where are they?
DAH: Vineyard Drive, just off 46 West, in Paso Robles.
ELLA: 46 West has lots of good wineries, but I’ve never heard of “Linne Calodo.”
DAH: Denner.
NAN: We’ve had Denner, haven’t we?
ELLA: Yes, they have that “Ditch Digger” wine.
DAH: And “Dirt Worshipper.”
NAN: How about South County?
DAH: Alban wines are very good.
NAN: Never heard of them.
ELLA: Me neither.
OK. That should suffice. This exchange is intended as an example of believing our own mythology. In my world of Paso and SLO wine, I mentioned some of the “best” wineries. The wineries that define what’s “best” in our region. Yet these wineries aren’t even part of Nan and Ella’s world.
When we make winemaking and marketing choices based on a specific mythology, with certain gods on pedestals, it’s best to remember that a lot of our consuming customers may be worshipping different gods. Or may not be wine-religious at all.
DAH is David Anthony Hance
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