Archive for the 'business of wine' Category

Maker of Yellow Tail sues Bronco over Down Under

YTdownunder
The Wall Street Journal reports today that Casella Wines, the maker of [yellow tail], has sued two companies associated with Fred T. Franzia over their new Australian wine, Down Under. Franzia’s Bronco Wine Co. also makes “Two Buck Chuck.”

The suit, filed in U.S. District Court in Manhattan yesterday, alleges that the label for [Down Under] is substantially similar to and infringes on the trademarked label for [yellow tail].

“Bronco’s use of Casella’s iconic square brackets and its use of Australian-centric wording in connection with the sale of Australian wine are likely to confuse consumers,” the lawsuit said.

[Down Under] sells for about $3, or half the price of [yellow tail]. Both wines come in high-shouldered bottles and have duotone capsules as seen in the image after the jump.

If you were presenting evidence to the judge, what would you say in this case? Read more…

Immoral? Sensuous? Get it Banned in Bama!

A remarkable wine story of the past few weeks that has gained lots of media attention is the story of “Banned in ‘Bama.” (click for details)

bj_winelabelInterestingly, UCLA law professor, Eugene Volokh, posted about this label and said that it seemed “pretty clearly unconstitutional.” Not that Hahn, the producer of the banned Cycles Gladiator, would want to challenge the decision since they have garnered such a huge amount of media attention: they are making a massive amount of lemonade from these tiny lemons and now is mounting point-of-sales material in other states to try the wine “banned in Bama.”

Which other labels might be in jeopardy of being banned in Bama? Hit the comments with your thoughts.

To get the ball rolling, consider the image to the right that is on bottles of Geheimer Rat, Dr. Basserman-Jordan from the Pfalz (click to enlarge). Not only does the woman have sensuous grapes in her hair, but the screw cap is adorned with some rather sensuous initials.

And while we’re on the topic of judging a wine by its label, be sure to surf over to a site called The Coolist and see their display of 30 cool and clever wine label designs.

Lots on labels – but not on American wines

lotnumberwinelabelShould wine lot numbers appear on the labels of American wines as they do in Europe?

The recent saga of Sierra Carche exposed some cracks in the process of wine making, wine reviewing, and wine buying. For those who haven’t checked out the saga (see Felix Salmon’s excellent summary over on Reuters.com), an influential critic gave a wine brand called Sierra Carche the score of 96, retailers sold the wine touting that score, but many consumers then found the wine undrinkable (as the critic also did 10 months later).

Although the mystery of how this could happen remains unresolved, the winemaker has pointed out there were three “lots” (a batch bottled under nearly identical conditions) of the wine and admitted one of those lots a different wine entirely that was bottled as Sierra Carche.

Charlie Olken, publisher of the Connoisseur’s Guide to California Wine, posted several comments on this subject on the previous thread about his experience with lot variation in domestic wines. An excerpt:

I cannot name the winery because of legal reasons, but I was asked to testify in a law suit in which a winery sued another company over wine lost in an accident. It turned out the winery had sold out of the wine in about eight months and simply went out on the open market and purchased wine in bulk and bottled it as their own under the same label. In discovery, it was found that the lost wine had 20% Chenin Blanc purchased at wholesale at a price way below what labeled grape would have cost.

Unless wineries are required to identify separate lots, whether they are bottling wine in California or Spain or Morocco, these kinds of events will continue to happen. Sometimes it will be only a slight difference in character as in the Ste. Michelle and Mondavi examples above, but the potential for mischief when anybody can bottle several lots under the same label is real and the Sierra Carche is not the only bad example.

Lot labeling has been mandatory in the EU since the early 1990s to facilitate traceability in the event of a recall or consumer complaint. Importer James Koch also posted to the comments: “I have been selecting wines by lot numbers since 1992 – a year after lot numbers started to appear on every bottle of wine – when I discovered that ‘bottle variation’ often is just the result by mixing up different lots. Due to the lot numbers I’ve been able to offer my clients the wines I tasted and selected on my wine buying trips – not only VERSIONS of it.” Koch also pointed out that lot numbers may be difficult to see since it can appear anywhere on the outside packaging material. Lot numbers must start with the letter “L” in Europe.

But American wineries are not required to print lot numbers on bottles. They should. And they should have a standard of 100 percent accuracy. Maybe some progressive wineries will start to do this as Bonny Doon has with ingredient labeling.

Several factors can cause bottle variation to the consumer and disclosing lots would at least provide more transparency. Remember all those consumers who found variation in Two Buck Chuck? Lot numbers could help sort out some of that.

Do you think critics should also list lot numbers in their reviews?

Sierra missed – the saga of Sierra Carche 2005

What happens when a reviewer tastes a good bottle, but some consumers buy what appears to be a completely different product? Think it couldn’t happen? Guess again and behold the saga of Sierra Carche 2005.

sierra-carche-label-l
Last fall, Wine Library, the Springfield, New Jersey wine retailer, sent out an email offering for a wine that seemed to be the wine lover’s dream: a fantastic quality-to-price ratio. The wine on offer was the Sierra Carche 2005, a blend of Monastrell with Petit Verdot and Malbec from the off-the beaten path Spanish region of Jumilla. Jay Miller, a critic at the Wine Advocate, described it as “Inky purple, the wine offers an array of scents which jump from the glass… structured wine with gobs of flavor, terrific intensity… It will provide pleasure through 2025.” He awarded it 96 points. The suggested retail price was $40; Wine Library was offering it for $29.99. Robert Kenney, a New Jersey wine consumer, was so enthusiastic upon seeing the email that he ordered several six packs.

But Kenney’s euphoria turned sour as soon as he pulled a cork. He later wrote on the forums at erobertparker.com that “I have consumed 6 bottles already, praying that with each popped cork, a different genie will emerge…so far, no such luck…slapping 80 points on those bottles is generous.”

Kenney describes himself as an “unabashed fan of DrBigJ,” as Miller is known. But Kenney was so disappointed with the wine that he corresponded with Miller and FedExed Miller one of his bottles last fall for him to taste and “see if indeed it was indicative of the wine that he had tasted and scored highly.” Kenney wrote last week that “During a ten month period I had exchanged seven emails with DrBigJ, reminding/imploring him to taste the sent bottle…to no avail.”

Then a consumer in Pittsburgh, Bob Hudak, posted that he had found the wine for $38 at the PLCB, the state-run store in Pennsylvania. On July 5, Hudak wrote of his experience, “Considering that it was a Dr Big Jay 96 pointer in the WA, I figured I buy 6 bottles. I opened my first one this weekend. Big mistake. The wine had virtually no aroma at all. You couldn’t smell a darn thing. With time and air, some stinky aromas that were off-putting became noticeable.”

Kenney chimed in on the thread as did several other consumers with their negative experiences with the wine. (The wine’s scores on cellartracker.com were not all bad although several reviewers took the time to note flawed bottles and one gave it a 74 but the modal score was around 90.)

On July 14, Miller posted to the forum that he finally opened the bottle Kenney had sent him and declared it “undrinkable.” Miller contacted the importer of the wine, Mark Clinard of Well Oiled Wine Co., who replied, “We have had similar problems with this wine and had a meeting in March with the winery to find out what the problem is. There was clearly some substandard product shipped by the winery and we have had to take back a large chunk of this wine from the market because it was rejected by the trade. I apologize on behalf of the winery for this apparent bait and switch. Going forward we are searching for a different winery for this brand.” He posted his cell phone number and asked that those consumers with problems contact him.

Brandon Warnke, Vice President of Operations at Wine Library, posted that anyone who bought the wine through the store could return it to them for a full refund.

Jay Miller then wrote: “this is about the worst thing that can happen to a critic, to be tasted on a fraudulent wine, publish a note, and then have readers spend their good money on a fairly pricey wine only to find out that it’s plonk or worse. Its reminiscent of the furor over Las Rocas a few years ago that nearly killed that brand. It’s a bad situation all around.” Read more…

Small wineries tweet harder

underpantsgnome

What do a winery (and vacation cottage!) outside of San Diego and a Muscadine wine producer in North Carolina have in common?

They are both the quantitatively best winery adapters of social media: Eagle’s Nest Winery has over 6,000 followers on Twitter while Duplin Winery, “the world’s premier Muscadine winery located in Rose Hill, North Carolina” has nearly 4,000 fans on Facebook.

Whodathunkit! Do the small, new or off-the-beaten-path wineries tweet harder? Rounding out the top five twittering wineries are: a winery founded in 2001 in the Barossa Valley; a proto-winery in Sonoma that has yet to sell a bottle; an Iowa winery; and Mouton Noir wines based in Harlem. Read more…

Can social media save the day for wineries?

125298482_d311563fcc_mToday’s Wall Street Journal has a piece on the luxury wine market that’s either sobering or heartwarming. If you’re in a producer, it’s probably sobering to read more about the sluggish sales, depressed prices for wines, the prospect of lost pricing power in the future, and possibility of increased merger and acquisition activity. But if you’re a consumer who is into high-end wines, it’s heartwarming to have the possibility to scoop up bargains, as one wine consumer does in the story.

The article suggests that “some of the newer operations [wineries] are using new marketing techniques to cope.” A case study:

Alpha Omega, a boutique winery in Rutherford, Calif., has begun using online services Facebook and Twitter to reach out to its customers. The winery three years ago began targeting consumers directly, and the strategy is now paying off; revenue is up 40% so far this year, compared with a year ago, in part because it doesn’t have to share many revenues with a distributor, says co-owner Robin Baggett.

Call me a skeptic, but I fail to see how the winery’s 296 friends on Facebook, 407 followers on Twitter and no blog can really help them move their wines (even if one of their tweets had a Palin-esque all caps consisting simply of “I love WINE.”) Their range of wines, crafted by winemakers Jean Hoefliger and Michel Rolland, starts with a $28 rosé and moves up to a $480 three-pack of reds in a wooden case. The WSJ article states that wines north of $25 are experiencing “a sharp falloff” so there must be some other secret sauce at Alpha Omega.

If it’s selling directly to consumers and bypassing distributors, then great. But I would imagine in this case that the 20% discount to club members speaks more loudly than their tweets.

Can social media really save the day for wineries? A story making the rounds these days is that the internet devalues everything it touches. But if both luxury and non-luxury wineries can somehow make social media work to increase their profitability while lowering prices to consumers, then that would be a heartwarming tale for all.

Pine nuts, the whale, the anchor, Vinexpo – sipped and spit

SPIT: pine nuts!
Losing your senses appears to be all the rage. First, it was Zicam, with it’s new FDA warning against possible anosmia (loss of smell). Now: pine nuts! According to Britain’s Daily Mail, increasing numbers of people have been left with a “foul, metallic taste” in their mouth after eating the nuts and that taste may linger for two weeks. Their columnist describes his experience with “pine mouth:” “Though I regained my taste after eight days, the only thing I could drink during that time was water, and the only food that was bearable was salad leaves smothered in strong balsamic vinegar. Drinking wine was like swallowing liquid metal.” Talk about an impossible food-wine pairing!

2792754683_624a54e21a_mSIPPED: a whale tale
In a fascinating post that provides a look into the business of selling wine, Lyle Fass, formerly in high-end wine retail, posts to his blog about the death of “the whale,” namely, the big customer who orders $10,000 worth of wine with a single phone call. He describes his performance-based pay conundrum: “At my last retail job I was hired with the idea that I would get a cut of the profits from the whales I would bring to the store. I thought this was great. I made a lot of money and was happy selling wine to these whales. Never did I think in my wildest dreams that I would lose my job as the economy went in the tank. But I had a high salary and a high bonus structure and as a result, I was not bringing added value to the store anymore. I was a money vacuum. So I was rendered jobless.” He concludes by predicting that “the whale is not coming back for a long time, if ever.” [Rockss and Fruit]

SIPPED: Follow the leader
Web 2.0, user generated wine review, on sites such as cellartracker, theoretically shift the power of reviewing away from one critic and over to the masses. But using an illustration of one of his Tablas Creek wines, Jason Haas writes about the power of the first review as an “anchor,” which then can set a tone for subsequent reviews that’s hard to break.

SIPPED: hope
Vinexpo, the big wine trade show kicks off today in Bordeaux. AFP reports on a study from Vinexpo that forecasts worldwide wine sales rising to 390 billion euros in 2012 from the current 330 billion euros, citing increased demand from China and Russia. Global wine consumption softened last year.

Ernest Gallo, behavioral economist

Just rediscovered this oldie but goodie in a decade-old article from The Economist:

ERNEST GALLO, the 91-year-old patriarch of the eponymous American wine company, tells a story about his early days of selling wine, just after Prohibition had been lifted. On visiting a buyer in New York, he offered him two samples of the same red wine. The man tasted the first glass, asked its price, and was told it was five cents a bottle. He tried the second sample, asked the price, and was told it was ten cents a bottle. “I’ll take the ten-cent one,” said the buyer.

Related: “Why so few tasty American wines under $12? Wine importer Bobby Kacher


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