Dr Vino's wine blog

One of the oldest and most dubious sales pitches in the wine trade might be “this wine comes from the vineyard right next to [insert prestigious winery name here]. Similar quality, a fraction of the price.”

Uh huh.

So it was with my eyebrow duly raised that I met with Cameron Hughes. He lures Costco shoppers down the aisle to try his wine by telling them that he’s got a “$30 wine for $9.99.” Based on some rhapsodic reviews of his wines on wine web sites, the claim sounded plausible enough to lure me to meet with him for a coffee one morning on his recent trip to New York City.

Hughes is not a wine maker. He is part wine finder, part marketer, and and part salesman. And he’s introducing an innovative way of making and selling wine that is delivering cost-savings to consumers in the form of some easy-drinking, value vino. Read more…

I recently tasted the intense, fruit-forward Tikal, Amorio, 2005 (about $30; find this wine). Along with notes of dark berries, tobacco and toast, was there also a whiff of petroleum?

The wine’s oversized bottle complemented the flavor profile perfectly since the bottle weighed about as much empty as a regular bottle full. I pity the wine store clerk who has to lift a case of it.

The heavy bottle took a long, meandering route to get to me in New York City. Starting out at the winery in Mendoza, Argentina, the wine’s American importer trucked it over the Andes to the port of San Antonio in Chile. There it loaded a boat and went to Oakland, CA. From there it came across country by truck to me in New York.

That’s a lot of carbon used to bring me this bottle of vino. But is it too much? At least the heavy bottle didn’t come by plane, which would have really jacked the petroleum per ounce of wine.

I was intrigued to read in the SF Chronicle that several restaurants have stopped serving (imported) bottled water because it is deemed too carbon inefficient.

Michael Pollan’s The Omnivore’s Dilemma prompted many eaters to think about the “carbon footprint” of their food and consider locally produced foods. Does that translate for you to your wine consumption?

The key issue for me is ease of substitution. I may be able to get water from local sources, but I can’t get any malbec locally. A tough call. Perhaps any eco guilt could be assuaged by buying carbon offsets?

Related:
“Local tap water bubbles up in restaurants” [SF Chronicle]
“Carbon neutral is hip, but is it green?” [NYT]

A couple of years ago I started a project that I called the Real Wine World. No, it didn’t involve locking three wine industry participants in a house and filming them 24 hours a day. Its goal was simply to follow a wine producer, a wine importer, and a wine retailer for a year to get a better look at how the wine biz works.

The participants were Susana Balbo in Argentina, Italian wine importer Gregory Smolik in Chicago, and the small shop Big Nose Full Body in Brooklyn’s Park Slope.

The reason I bring this up now is twofold. First, I have just transfered all the pieces over to this new site, posted to their original dates. You can find the lead-off piece here. And thanks to the new categories function, you can find all the pieces under The Real Wine World. The pieces now have space for your comments!

Second, I thought I should bring closure to the project. Everyone got busy and the project didn’t make it the whole year. Susana Balbo had further demands on her time as she became president of the Wines of Argentina trade association. Gregory Smolik’s career as an independent importer of boutique wines from Italy came to an end but he now brings his passion and knowledge to his new job at the importer Domaine Select. Big Nose Full Body is still lubricating the palates of Park Slopers with free tastings on Saturday afternoons and 15% case discounts every day.

Who knows, maybe we’ll try for a second season of the Real Wine World sometime?!

There’s an adage in the restaurant business that the reputation is made in the kitchen but the profits are made at the bar. Perhaps that should be refined to “wine cellar” instead of merely “bar” for the world’s top restaurants. The highest profits seem to come from selling wine, not mere booze.

In a fascinating and lengthy profile of Chef Gordon Ramsay in the New Yorker, Bill Buford let this nugget drop about the operations at Gordon Ramsay at the London:

“The [food] prices—the best value in New York—had been deliberately set low, Ramsay told me, to encourage people to spend more on wine, an upmarket restaurant’s greatest potential profit (no overhead, no spoiled ingredients).”

So is wine the REAL profit center at restaurants? One time Mrs. Vino and I were dining at Charlie Trotter’s in Chicago with another couple, one of whom ordered a gin and tonic. The waiter frostily told her that the restaurant serves no cocktails. Apparently it’s in the name of gastronomy since alcohol can deaden the palate. Chef Thomas Keller does not serve cocktails at the French Laundry in Napa either, although it has something to do with allegedly not being able to get the proper license.

Are gourmet restaurants pushing diners toward wine? In the New Yorker story, Buford reports on a group of hedge fund managers at the exclusive “chef’s table” who ordered $10,000 worth of food and wine. Another group from Goldman Sachs was set to take the table the following night: “budget not important,” was the word in the house. And at Petrus, a Ramsay restaurant in London, investment bankers famously ran up a $63,000 wine tab a few years ago (they later had to resign over it). That’s a heck of a lot of gin and tonics even at $20 a pop, the price at Per Se.

So is wine the real profit center at high-end restaurants? If this secret gets out, maybe mid-tier restaurants will start upgrading their wine programs. A wine geek can but hope.

* * *

On a related note, Gregory Condes, who oversaw the acquisition of $750,000 worth of wine for Gordon Ramsay at the London, has been fired according to the Sunday Mail after a wild night. It could be an April Fool’s spoof, but it seems too harsh.

The craziest thing about being a wine consumer in America is that actually getting wine can be so difficult. And if it’s not impossible to find, a wine–the exact wine you are looking for–can be expensive. There’s so much red tape it’s almost enough to make you drink beer.

Well, the US wine market just inched toward normalcy. While Staples can order staplers directly from the producer in China, wine stores in New York have been prevented from ordering wine directly from wineries in California. The wine must go through a state-licensed wholesaler and a wholesaler cannot also be a retailer. This can create a bottleneck preventing the wine from low-volume producers who can’t interest a wholesaler in taking on their wines.

Thanks to some new software and a more generous interpretation of the stodgy laws, wine stores and restaurants in New York can now order “directly” from wineries in California. The stores can order from small wineries and the software “clears” the wine through a participating wholesaler who pays appropriate taxes to NYS. The wholesaler is still getting paid (presumably less than their normal markup of 30-50 percent) simply for having a distribution license and not adding any logistical or sales value. But at least the consumer has a slightly greater choice since there will be a few more six-packs of limited-production wines in Manhattan.

I wonder who gets bumped off the Screaming Eagle mailing list so that Sherry-Lehmann can get on?

Seriously, I hope that it will increase the visibility of wines from the Pacific Northwest. I have been underwhelmed by their representation in NY stores. Let’s just hope the prices are reasonable…

Related: “New York Merchants can by wine directly – almost” [Decanter]

UPDATE from the Dr. Vino inbox: “To me, this seems another example of a big deal being made out of something that will ultimately have no real impact on retail stores. Also keep in mind that larger stores (and restaurants especially) don’t like having 18 different vendors and also like to use relationships / partial exclusivities to get more allocated wine and better deals…”

tags: wine | the business of wine

“I will make as much selling grape plants off of two acres this year as I did many years on 1,000 acres of corn and raising 3,000 head of hogs,” said Stan Olson in today’s NYT. Olson used to grow corn and soybeans on hundreds of acres in Iowa west of Des Moines. Now he supplies many of the state’s 70 wineries with vine cuttings.

I observed a similar shift in Walla Walla, Washington earlier this year. There, one apple grower had uprooted some of his orchard to plant grapes. Even though apples had a higher profit per acre at the farm gate, with the added value of making wine, grapes were the winner.

And then there’s the tourism, which is even being felt in Iowa according to today’s NYT story.

Summerset [Iowa] has also become a tourist destination, with concerts on the weekends, themed parties and grape-stomps that draw thousands. Tourists will actually pay for the privilege to stomp grapes.

With growing demand from wine consumers, producers are popping up at a staggering rate. In Iowa, there were 15 wineries in 2000, which represents a growth rate akin to an internet stock to reach the current 70. However, they join an already-crowded field that is oversupplied with wine. But they have an edge that non-descript wine from California doesn’t have: they’re local. And that seems to go down easy.

tags: wine | iowa | american wine

“To launch a champagne in the U.S. you either need three or four centuries of history, or have a big rapper behind you,” said Emeric Sauty de Chalon, the head of one of France’s leading online wine retailers, 1855.com in today’s Wall Street Journal.

Buried on page B2F of today’s Journal was a fascinating story about how Jay-Z, hip-hop mogul, selected Armand de Brignac, aka “Ace of Spades,” as his new champagne of choice (find this wine). Early last summer Jay-Z called for a boycott of Cristal after “racist” comments from Frederic Rouzaud, the boss at Louis Roederer, which makes Cristal.

In the WSJ story, Jean-Jacques Cattier, the brand owner tells how he was unable to sell his champagne in the American market for 20 years. Brett Berish of Sovereign Brands, a drinks importer and marketer based in New York, approached Cattier about reviving his old brand name “de Brignac.” The association of champagne growers, the CIVC, approved of reviving the name providing they added a first name. So they chose Armand since “it sounded kind of noble,” according to Cattier in the story.

Two points of “controversy” surround the launch. The first is whether Jay-Z has a stake in the brand, which he denies. This is not controversial in my view. Given the amount of promotion Jay-Z will no doubt do for the brand and the increasing amount of celebrity wines, this does not strike me as the least bit controversial. But it is funny how much Berish is denying it even going so far as to tell BusinessWeek “But it’s not like we just cooked this brand up to capitalize on that [the Cristal boycott].”

The second point is controversial in the same way that the Emperor’s clothes are controversial. Apparently the $300 Armand de Brignac tastes remarkably similar to a $60 bottle of Cattier’s wine only available in Europe. If you buy marketing, you should be expected to pay a premium.

Related:
“French Bubbly Garners Hip-Hop Cred” [$WSJ]
“Is the champagne in the Jay-z video for real? It’s complicated.” [BusinessWeek]

tags: wine | Jay-Z | champagne

At 7:46 AM today, America hit the 300 million inhabitants mark. Whoever thought of giving this an exact time is a marketing genius extraordinaire. The 400 million expected in the next 50 years (exact minute not yet specified), what’s the likely impact on wine?

It’s likely to be good.

America is already forecast to become the world’s largest market for wine by 2008 according to VinExpo, a French trade group. Not only are Americans currently drinking more per capita, but with an expanding populace America is likely to remain the favored market for the world’s wine producers. While producers from France, Italy, and Argentina, have to look abroad for growth American producers can focus on the growing home market.

And those American producers could be smaller and more dispersed. Wine Business Monthly estimates that there are close to 4,000 wineries in America now. In 50 years, there could be 20,000. And many of those could be in the other 47 states that are not California, Washington, or Oregon.

For consumers, more local wine might mean knowing more winemakers. Wine makers could be less of celebrities and just a member of the community, a vigneron if you will. Snob value could be shed in favor of actual drink value as more wines make it on to the American table. Probably many of those will also be imported since foreign producers seem particularly clever at making and marketing wines that sell at low prices.

Wine might also finally lose some of its lingering stigma and become the choice of moderation that Thomas Jefferson thought it. Quirky laws known as “blue laws” and laws against shipping that keep wine sales different from other consumer products might have withered. The market for distribution might even be more competitive.

So let’s raise a glass to the demographer’s most likely choice of the 300 millionth American, Maria, born in LA this morning at 7:46!

tags: wine | wine consumers | American wine