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Winebits 373: Big Wine, Treasury, direct shipping

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Big Wine How big is big? One of the most difficult concepts to get consumers to understand is that their wine probably isn’t made by who they think it is. As noted here, Big Wine controls a majority of the U.S. market, and Big Wine includes many companies most of us have never heard of. Case in point: Trinchero Family Estates, a 20-million case producer that wants to be a 30-million case producer. And how many of us have heard of Trinchero, a California company? It’s best known for Menage a Trois and Sutter Home, but those are only a fraction of Trinchero’s production and its three dozen brands. If Trinchero makes it to 30 million cases, it will be as big as the entire U.S. wine business was in 1965.

Now they’ve figured it out: Regular visitors may remember the Wine Curmudgeon’s attempt to cash in on Treasury Wine Estate’s financial woes, which — not surprisingly — failed. One reason, aside from my lack of financial acumen, is that the people running Treasury were a little confused about how to sell cheap wine. Luckily for the company, that seems to have changed, and its results in the U.S. are much improved. Ironically, it seems this success came from a formula that I suggested when I wrote abut Treasury’s problems last year. Not that the company needs to give me credit — I’m used to saving really rich people lots of money.

The judges like their wine: Supreme Court Justice Ruth Bader Ginsburg made a bit of news last week when she admitted she fell asleep during the State of the Union address in January because she had too much wine. This got giggles from many, but they missed the point, focusing on Ginsburg’s age, 81. Rather, it points to the real reason the court ruled in favor of direct shipping in 2005 in the landmark Granholm decision, which surprised many observers. Forget precedent and constitutional interpretation; the Supremes carved out an exception to the three-tier system because they liked wine and wanted to be able to have it shipped legally from their favorite California wineries. How else to explain that Ginsburg, Anthony Kennedy, and Antonin Scalia, all referred to in the BBC story in the first link, voted to allow direct shipping?

“Our panel of experts:” Irony and non-winery wine clubs

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wine club expertsThird-party wine clubs — those that aren’t part of wineries — have always made the Wine Curmudgeon smile. How about the the website that rates wine clubs, and that also rates the wine clubs that the site operates? Or the wine club that offers “first-class” cabernet sauvignon from Spain, a concept that makes as much sense as coming here to find cult wine recommendations from Napa Valley.

Typically, most third-party wine clubs don’t tell you the wines you’re going to get or how they pick the wines you’re going to get. They trade on the group’s name, but are otherwise separate; hence a  newspaper wine club is a marketing tool that has nothing to do with the newspaper’s wine reporting. Mostly, there’s flowery language — “small-batch wines of real flair and value,” which means absolutely nothing when you try to parse it — and lots of promises about how good the wines are. Plus tasting notes, because all wine needs tasting notes, doesn’t it?

Which makes me wonder: Most of us wouldn’t buy shoes this way, sight unseen and trusting to someone else’s judgement. So why would we buy wine this way?

My newest smile is Global Wine Company, which runs the New York Times and Washington Post wine clubs plus those for retailer Williams-Sonoma, More and Food & Wine magazines, and celebrity chef Michael Mina. Check out the people who run the company — accountants and bankers, and a woman who helped make the PowerBar famous. There is no mention of the “panel of experts” who pick the wines, and about the only wine-related information I could find was this: “GWC handles all global wine sourcing, state compliance, and customer fulfillment, which enable partners to expand their brands into wine and drive recurring revenue.”

Mmmm, drive recurring revenue. How yummy does that sound?

Winebits 311: Direct shipping, wine snobs, wine trends

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Wine by mail: The U.S. Postal Service, which sees wine shipments as a key to its survival, is one step closer to putting wine in your mailbox. Influential U.S. Senator  Charles Schumer (D-N.Y.) endorsed the idea recently, saying the proposal would allow the postal service to better compete against UPS and FedEx and add $225 million to its annual revenue. The Wine Curmudgeon has his doubts about whether the postal service can deliver wine effectively, given his past experiences with the agency and its failure to deliver his mail. Hence Schumer’s enthusiasm doesn’t do much for me. Plus, his estimate of $225 million in revenue is almost five times the original postal service estimate. But it looks like the agency will get the authority to deliver wine sometime next year.

More than expensive wine: Charles Antin, a wine expert who has tasted most of the world’s great wines, has a confession: Expensive wine ain’t all it’s cracked up to be. “But just as I think that if you’re not drinking aged wine, you’re missing out, I think that if you’re only drinking collectible wine, you’re also missing out.” Or, as Antin notes elsewhere in the article, he was so busy chasing thousand dollar bottles of wine that he didn’t drink rose. And he was the worse for it. The piece, if a little jargony, is well worth reading, for it points out that wine is about more than what the wine snobs say it is. It’s also about sharing the joy of wine, and that it doesn’t matter how much the wine costs then.

Slower economic growth? The wine industry is recovering from the recession, but not the way it wants to. That’s the consensus from a recent wine business seminar, as reported in the Press Democrat newspaper. Baby Boomers, who drove the explosive growth of the U.S. wine industry in the 1990s, are retiring and will be progressively less able to afford expensive wines, analysts said. Younger generations have other interests, including spirits, and the  Millennials are often more burdened with debt than older demographic groups. The article, mostly an overview of what we’ve been writing about on the blog for the past several years, is notable because it quotes leading industry experts offering their wisdom. Which means there’s a chance the wine business might start paying attention.

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