Saturday, November 7, 2009

My Thoughts on a Good Article About the Wine Business

You should read this article about modern wine branding so that you know what you are getting. Some quotes followed by my thoughts:

“Customers should not look down on those scenarios as fraud; this is the reality of wine industry. All wine producers produce many their brands, large or small, the same way, “ says Jonathan Gelula of KDM Global Partners, a wine branding company.

Really? Were you aware, before reading this, that this was the reality of the wine industry? How is it not fraud to produce a mega-brand and market it so that it looks like it was made by a small family winery? Just because it's the reality of the wine industry doesn't mean it's not fraud.

Similarly, if you walk into any wine shop—in any town, in any state—you will probably see Rock Rabbit, Mark West, Smoking Loon, or Pepperwood Grove.

Not us.

Whether you want value or authenticity is up to you. But you generally don’t get both.

Rubbish. This is repeated over and over and it's just not true. Re-branding is just a way to make an extra buck, to pretend like you're giving the customer great wine for a low price is deceitful. I can show you a bunch of wines we sell that are produced and bottled by the same winery that are not expensive, including the Cholila Ranch Malbec that's been a big seller for us recently. In fact, look at our 6 for $60 wines this month. Every one of them is from a small or medium-sized winery that produces and bottles their own wine, and you get all six of them for $60 including tax. I'm not saying this to toot our own horn, I'm saying it to demonstrate that this idea that big brands are better values is not true. Plus value is in the eye of the beholder. I'd rather buy better wine and drink it less often than buy cases of super cheap wine and drink it a lot.

Interestingly, when it comes to Champagne the reverse of this scenario is true (ie the more familiar the brand is the more you have to pay for it). I'm often asked if I carry Dom Perignon and struggle to convince people that our $45 Champagne is better than the $140 Dom Perignon. Some people are not convinced, they want the Dom Perignon because they know the brand. It's all about branding, not value.

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