Tag Archives: Liv-Ex

Winebits 666: Wine ads, wine country fires, expensive wine

wine ads
“Come on. ..you know sex sells wine.. even if it doesn’t.”

This week’s wine news: Wine ads are missing the point by emphasizing sex. Plus, a wine country fire update and expensive wine foolishness

• Sex doesn’t sell: A new study, published in the academic journal Sex Roles, casts doubt on whether sex actually sells products. This result should be especially important for wine marketers, who rely on sex almost as often as they do snobbery to sell wine. The Italian study found that women were less likely to find a product attractive and were less likely to purchase it if the product used sexual female models than if the ad was neutral. Men, even more surprisingly, were unaffected by ads’ sexualization. Said the authors: “The present study has practical implications for marketers because it suggests that ‘sex does not sell.’ In addition, considering both the psychological damage and practical inefficacy of sexualized ads, our findings have important implications for public policy.”

• Scorched vines: The Wine Spectator does a fine job recapping this fall’s California wine country wild fires, “More than 200 wineries are in evacuation zones. A few vintners have managed to return to their properties to assess damage in recent days. But evacuation orders remain in place for much of the area, keeping many out.” I did a Napa radio show a couple of weeks ago, and it looked like the worst of the fire season was over. But then the Glass Fire sprang up last week.

• Betting on wine: We’ve written several times about the Kafka-esque reality of Liv-Ex, a stock exchange for the world’s most expensive wines. I mention it again to show one should drink wine instead of investing in it. A smart investor, according to the Liv-Ex article, would have seen a 20 percent return in a decade by investing in specific Robert Parker-favorited wines. Wow — two percent a year? Can’t I get that with a bank CD and then drink the wine?

The growth of ultra-expensive wine

expensive wineDoes the increasing popularity of ultra-expensive wine mean wine has become a collectible and not something to drink?

The Big Guy, who hangs out with a better class of wine drinker than I do, forwarded me the auction company email: “Can you believe the prices of these wines?” he wrote. The list was expensive wine run amok – impressive labels, certainly, but prices that even I had trouble comprehending:

• $8,500 for a bottle of red Burgundy.

• $1,000 for two bottles of an 1872 Madeira.

• $40,000 for a case of 2000 Petrus, perhaps the Holy Grail of wine collecting.

• $4,750 for a magnun of another red Burgundy.

Which raises a host of questions: Who buys these wines? Do they actually drink them? And, of course, the one that has always fascinated me – how does one justify paying thousands of dollars for a bottle of wine?

Because spending that kind of money happens all of the time. It’s just not auctions, but includes trading on Liv-Ex, a stock exchange for wine. In this, the growth of ultra-expensive wine sales and expensive wine becoming more expensive have been hallmarks of the 21st century wine business. Two decades ago, people bought wine to drink it. Today, more and more people buy wine not to drink it.

This matters for two reasons. First, as these ultra-expensive wines grow in popularity, more resources will be devoted to them. If more resources are devoted to these wines, will less be available for the wine that most of us drink? Second, how healthy can the wine business be when its most prized products are kept in locked vaults? How can the evolution of wine — from something to drink with dinner to a version of coin collecting — be a good thing?

Yes, the sale of ultra-expensive wine remains a small part of the wine business. Those 10 million cases of Barefoot that are sold annually dwarf ultra-expensive wine sales. But how much attention does all that Barefoot get? The hype for ultra-expensive wine dwarfs Barefoot, as well as the rest of the wines that most of us drink. That even I’m writing about it says something – and it’s probably not good.

More about ultra-expensive wine:
• Wine as a collectible, and not something we drink
• Expensive wine prices in the real world
• More about wine prices 2018