Fermentation: The Daily Wine Blog

Would You Pay $80 For Wine In A Box?

If the Australians, Swedes, English, Danes and progressively more and more Americans are ready to wrap their arms around premium wine in a box (also known as bag in a box), why aren't I?

While watching the Oscars I was chatting with a great friend who is a marketer at a North Coast winery. She was telling me about the investigation her winery was making into perhaps bottling (boxing?) ultra premium wine. Right off the bat I'm thinking, how better to kill an ultra premium brand that has a great reputation. She on the other hand thinks the "Ultra Premium Wine-in-a-Box" might just fly off the shelf. Ultra Premium in this conversation means $20 for 750 ml.

To appreciate her enthusiasm all you have to do is take a look at boxed wine sales.

50% of wine consumed in Australia is from a Box
60% of wine consumed in Sweden is from a Box.
The English are over 25%

Boxed wines are getting big in America too, but not nearly as big as in Australia or Sweden. "Black Box" is making and selling over 250,000 cases of wine in a box...in just 2 years.

Richard Kinssies, along with my wine marketing friend, believe that eventually American's will embrace wine in a box. Well, I think so too. At a certain price point.

Right now the best boxed wines, usually selling in containers that hold the equivalent of 4 bottles of wine, costs $20-$40 a box. That's about $5-$10 per bottle.

But what about boxes of wine that cost $80 per box---the equivalent of $20 per bottle. Will it sell? Is my wine marketing friend who's considering this off her rocker?

It's clear that for acceptance of the boxed wines, consumers need to feel like the wine in the box is far better than they thought it should be. Expectations need to be exceeded. That's what has gotten American's interested in boxed wines so far and it's what has led Australians to completely embrace the concept.

What kind of wine would you have to put in a box that sold for $80 in order to exceed consumer expectations? PDGW...Pretty Damn Good Wine.

What producers have going for them is that packaging costs are far less for boxed wines than they are for bottled wines...up to 80% in some cases. And apparently the box technology is great. Nevertheless, it seems to me that to pull off this feat of exceeding expectations, you'd have to work hard to convince consumers that the only relationship between quality wine and its package is the extent to which the package keeps the wine at its original high quality. Clearly this is the case. The only job of the wine package is to preserve and do no harm.

But we are a funny people. We like our packaging here in America. The light blue box that says "Tiffany" on it often stays on the dresser long after the broach inside it finds its way to the back of the drawer.

I'm skeptical that Americans in any number would accept the idea of paying $80 for a box full of wine.

Am I wrong? Am I just a snob?

A Sign of the Wine Times

Premier Napa Valley, a Trade-only auction organized by the Napa Valley vintners, delivered another bit of good news for the wine industry on Saturday.

A record $1,459,000 was raised, besting last year's take by 48%. The real interesting number however is the price per lot that was attained at this year's auction. Retailers, restaurateurs, wholesalers and others spent an average of $8,842 on 165 lots, an increase of 42% over last year.

I don't think there is any way to read these results than to conclude that a robust confidence exists within the wine trade, evidenced by the loosening of the pocket books on the assumption that their customers will also be willing to pay more for fine, high-end wines.

But to give some perspective, following is the percentage change in price per case over the previous year for the past five years of the Napa Premier Auction

    2001:  UP 9%
2002: DOWN 16% 
2003: UP 7% 
2004: DOWN 8%
2005: UP 42%

Good times in the wine industry are completely dependent on an expanding economy. Luxury, non-essential goods follow the money. There have been a number of signals and statistics that suggest wine buying is up. This is one more signal that things are looking good.

Oscar Predictions & the Wine Kitty

The Oscars and Wine are have a long history in our home of being paired together. This will be the 8th year will celebrate the Oscars with friends and wine.

It's pretty simple. Everyone brings a bottle for the "Wine Kitty" We each have a ballot. Whoever guesses the most winners correctly takes home all the wine. The winner usually takes home a couple cases.

Of course this year is a bit different with SIDEWAYS in the running. Different for wine folk, at least. It would be remarkable for the wine industry if SIDEWAYS won for Best Picture. But, it won't.

My Oscar Predictions:

Best Picture: Million Dollar Baby
Best Director: Martin Scorsese
Best Actor: Jaime Foxx
Best Actress: Hillary Swank

SIDEWAYS Predictions:
Will Win: Best Supporting Actress (Viginia Madsen)
Will Win: Best Adapted Screen Play.

More Top Pinots PIcked By the Pinot Report

Earlier this month I distributed the PINOT REPORT's "Top 12 wine picks for 2004." There was a good deal more than just the top picks listed in this year end report. So here are the rest, ranging in Value Pinots to Pinot Areas to Watch to Top Pinot Restaurants. To get the details on these picks you really need to subscribe to the Pinot Report.

The list of "Pinot Vineyards You Can Trust" is a pretty interesting idea. You don't often seen such a list. But its time has come as more and more wines carry the same vineyard designation.

Top 12 Pinot Values of 2004
1. HRM Rex Goliath Pinot Noir Central Coast Free Range 2001, $7.99
2. Sebastiani Vineyards Pinot Noir Sonoma Coast 2002, $15
3. Turning Leaf Pinot Noir California 2001, $10
4. Edna Valley Vineyard Pinot Noir Edna Valley Paragon 2002, $15
5. Babcock Winery & Vineyards Pinot Noir Tri-Counties Cuvee 2002, $18.50
6. Russian Hill Pinot Noir Sonoma Coast 2001, $24
7. Chalone Vineyard Pinot Noir Chalone 2002, $25
8. Bishop's Peak Pinot Noir Central Coast 2001, $16
9. Buchli Station Pinot Noir California 2002, $12
10. Gallo of Sonoma Pinot Noir Sonoma Coast 2001, $15
11. Chateau St. Jean Pinot Noir Sonoma County 2002, $19
12. Acacia Winery Pinot Noir Carneros 2002, $20

8 Pinot Noir Vineyards You Can Trust
1. Cargasacchi Vineyard, Santa Rita Hills
2. Clos Pepe Vineyard, Santa Rita Hills
3. Dutton Ranch Vineyard, Russian River Valley
4. Hellenthal Vineyard, Sonoma Coast
5. Hirsch Vineyard, Sonoma Coast
6. Hyde Vineyard, Carneros
7. Keefer Ranch, Green Valley
8. Rosella's Vineyard, Santa Lucia Highlands

4 Pinot Noir Regions To Watch
1. Green Valley, Sonoma County
2. Sonoma Coast, Sonoma County
3. Chalone, Monterey County
4. Westside Paso Robles, San Luis Obispo County

3 Great Pinot Noir Restaurants
1. Farallon, San Francisco, California
2. Dundee Bistro, Dundee, Oregon
3. Zazu, Santa Rosa, California

Breaking Down New Zealand Pinot

When grapegrowers and winemakers of an emerging wine region begin debating where the best of a particular varietal is grown, you know that wine region is no longer emerging...it has arrived.

This is the case with New Zealand and its highly praised Pinot Noir.

In a recent article for The Wine News by writer Gerald Boyd, New Zealand's various regions are considered in the light of their Pinot Noir. Boyd looks at the Pinots coming out of the Martinborough, Marlborough, Waipara and Central Otago regions of New Zealand. The article is a great intro to New Zealand Pinot.

It also needs to be mentioned that The Wine News is celebrating its 25th Anniversary of publishing what is certainly America's best looking wine magazine. I love this publication for this reason, but like a pretty blond, its best not to assume the magazine is all appearance and no brain. Wine News continues to employ great writers who are given the freedom to look into their topics with depth.

This article, "Kiwis Cultivate Prototype Pinots" is a perfect example.

Napa Valley's "OTHER" Auction

Saturday Napa Valley holds its "other" Auction.

"Premier Napa Valley" is an auction held mainly for the trade. Restaurateurs, retailers and distributors gather at CIA Greystone and bid on barrels of one-of-kind wines. Wineries duel for the highest price paid for their wines. What kind of wines?

2003 Astrale e Terra Single Vineyard Atlas Peak Cabernet
Cakebread 2003 Merlot/Cabernet Franc Blend
Domain Chandon 2003 Block 173 Pinot Noir
Fife 2003 Spring Mountain Syrah, Petite Syrah, and Cabernet Sauvignon Blend
2003 Hartwell "Sunshine" Cab/Merlot Blend

Basically, these are wines you can't get anywhere else.

It a fun event mainly for the pre-auction tasting. Vintners and owners are on hand behind their barrels, pouring the wines that will be auctioned.

The event raises money for the Napa Valley Vintners Association

Alan Goldfarb has written a pretty good article concerning the event.

A Gutsy Move in Napa Valley

Many years ago I fired off a letter the editor of the Wine Spectator. The letter was aimed at Spectator columnist Matt Kramer. It was a not so subtle attack on what I recall was his contention that one day, when California vintners got it right, only one or two varietals would be planted in the States' appellations (Cab in Napa, Pinot and Chard in Russian River, Zin and Sauvignon Blanc in Dry Creek, etc.). I called Mr. Kramer a "Terroirista".

It struck me that what would essentially be a move toward the French AOC model of wine regions being devoted nearly entirely to one or two varietals was in fact anti-American. I was arguinig that the Zinfandel, planted next to Cabernet, planted next to Chardonnay, planted next to Pinot Noir was a reflection of America's inbred inclination toward diversity and it would be a terrible thing to lose this in favor of a regional monoculture.

Since then I've become a bit more sophisticated in my thinking on terroir, in large part, ironically, due to reading Matt Kramer's fantastic "Making Sense of" series of books as well as following his writing in the Wine Spectator.

But yesterday I was provoked by an email from Ballentine Vineyards into reconsidering the notion of multiculture viticultural. What brought me back was the idea of Napa Valley Chenin Blanc.

The question that I kept coming back to was, "Are we losing something very valuable as Napa Valley continues its march toward becoming a Cabernet-only appellation, as grapes such as Gamay, Petit Sirah, French Colombard and Chenen Blanc get replaced in Napa by Cabernet?

Consider the numbers.

ACRES OF CHENIN BLANC PLANTED IN NAPA VALLEY
1982....2,558
1988....2001
1991....1152
1992....1001
1993....793
1994....693
1995....629
1996....501
1997....504
1998...445
1999....242
2000...169
2001....166
2002...138
2003....138
(Statistics from the California Agriculture Statistics Service)

Between 1982 and 2003, the number of acres of Chenin Blanc in Napa Valley have dropped by 95%. It is on the verge of extinction in Napa Valley. During this same period the acres of Cabernet planted in Napa Valley has increased nearly 300%.

It needs to be pointed out that the fall in Chenin Blanc is not a result of the grape not making good wine. The grape delivers naturally high acidity and a set of delicate fruit flavors. Grown with care in Napa Valley it could, has, and does produced lovely wine.

Economics is the reason Chenin Blanc may become extinct in Napa Valley. Each year the North Coast Grapegrowers releases suggested pricing for different varietals grown in different areas of California.In 2003 it recommend a ton of Napa Valley Cabernet be priced at $3,900. It recommend a ton of Napa Valley Chenin Blanc be priced at $800. If you were a grower with 20 acres in Napa Valley what would you plant. Let me do the math for you. Assuming you produced 3 tons per acred of Cabernet on your 20 acres your gross would be $234,000. Three tons per acre of Chenin Blanc would result in $48,000.

Over at the Winespectator.com I found a total of 2 reviews of Napa Valley Chenin Blanc published from the 2000 vintage forward. And its not like the Spectator doesn't like Napa Chenin. In fact, I'd bet they'd jump at the chance to review it. They just don't have the chance to review it.

I was prompted to look into the status of Napa Valley Chenin Blanc upon learning via email that Ballentine Vineyards in Napa is now producing 1000 cases of the wine. How rare is this? There may be only 2 or 3 other wineries that now produce a Napa Valley Chenin: Chappellet, Casa Nuestra and Ballantine. (please, someone correct me if they know of others)

The Ballentine Vineyards 2004 Pocai Vineyard Estate Napa Valley Chenin Blanc is made from old vines on their estate which sits next to the famed "Three Palms Vinyard". The vines range in age from 60 to 30 years. The vineyard is roughly 8 acres and yields two tons per acre. The price is a mere $14 for this rare piece of Napa Valley history. For thirty years these grapes were sold to Beringer Vineyards. It shoudn't be surprising that these vines are so old. Very little Chenin has been planted in Napa recently.

Ballentine describes their Chenin this way:

"Our Chenin Blanc has a golden hue and aromas of citrus blossoms, honeysuckle, green and red apple, grapefruit, and vanilla. This Chenin is crisp and clean with minor notes of vanilla, smoke and toast. The stucture of the palate is full and silky with a crisp finish. The wine has a citrus and zesty character on the palate with notes of melon, apple, and floral blossoms. There is a full nature in the mouthfeel with an extremely slight barrel toast on the finish."

You have to admire the Ballentines for taking up the production of Chenin rather than ripping out these vines and planting Cab. It's gutsy. But then again this is a family that has been in Napa for over a century. They likely know what works. I think it takes this kind of perspective to go out on the limb they are with their Chenin.

And it's good for Napa Valley too. While no one would question that Napa Valley's present and future is built on Cabernet, this wine reminds us that Napa can do wonderful things with something other than Cab.

That Wine's Gonna Be a Star!!

With the success of the movie Sideways in bringing new consumers to wine, will more wineries begin to participate in Product Placement Marketing? I think so.

The problem with marketing via product placement is the same with using media relations: it's not always easy to quantify the impact of having your wine discussed in articles. It's equally difficult, in most cases, to gauge the impact of having your product spontaneously appear in a move. Surely some placements are better, such as when your product is part of the plot. But this is rare.

Clos Du Val winery in Napa is one winery that has used product placement marketing. According to Brooke Correll, Clos Du Val's VP of Marketing, the winery spends about $5000 per month to engage a product placement firm to get their wines in front of set designers and propmasters for TV and films. Add to this over 200 cases per year sent out for product placement purposes. You are looking at over $100,000 per year in fees and products to carryout this program.

(There is a good story on Clos Du Val's efforts here)

Clos Du Val has seen its wines show up more than 100 films and television shows, including The Sopranos and the movie 21 Grams. And sales were up after they begin this product placement strategy according to Correll.

Product placement has been increasing over the past couple years. When Tivo's Digital Video recorder began to take off early last year, there was a great deal of discussion among advertisers and marketers that product placement would naturally increase as a strategy to overcome those who were skipping past commercials with their Tivo remote in hand. There is no reason to think the practice won't continue to increase.

Wineries will get into the game. But clearly it's not a cheap game to enter. Don't expect to see that small, 2000 case winery showing up in lots of movies. But look for lots of Gallo wines and those of the other big boys.

America's Greatest Wine Event

I got my invitation to what might be the best wine event in America. It is, at least, the best wine event I've been too in the last 15 years.

The International Pinot Noir Celebration (July 29-31) takes place at Linfield College in McMinnville, Oregon. The small, rural town sits in the middle of Oregon Pinot Noir country. It's quaint. But the gathering that takes place there every summer attracts the most high profile Pinot Noir producers in the world and a collection of very appreciative Pinot lovers.

What has always made the IPNC a great event is the intimacy its organizers create the results from it somewhat isolated location and the small number attendees it allows. This year they will allow only around 700 attendees. In the past organizers have had to carry out a lottery to see who gets in. This year it is first come, first served for the $795 tickets that go on sale March 1st.

Each year a number of wine celebrities are on hand to lead seminars and talks. This year's include: Michel Bettane, France's most famed wine critic; MW Michael Broadbent, one of the greatest wine commentators of the past 50 years; MW Bob Campbell, teacher and editor of New Zealand's Cuisine Magazine; Andrea Immer writer and educator and once named "Best Sommelier in the U.S.; Elin McCoy, A writer who will soon be releasing    "The emperor of Wine: the Rise of Robert Parker, Jr."; Alexander Payne, Director of Sideways; Pierre -Antoine Rovani, the Wine Advocate's palate for Oregon, New Zealand and Burgundy.

The best event at the IPNC is the Saturday night "Grand Dinner". The meal is always spectacular, highlighting Oregon's best chefs. But the real fun is the wine. Traditionally, attendees bring with them some of their most spectacular wines, most of them Pinot Noir. Bottles get past around the room, trading of bottles occurs, bartering has been known to occur.

If you want to go, you really must sign up now and hope you are one of the first. Even getting on the waiting list is an accomplishment.

Alabama: No Wine, No Sex Toys

Perhaps I'm too close to the issue. Nevertheless, I've always looked at these anti-direct shipping laws passed in the various states and seen them as among the most silly and obnoxious laws any state could possibly think of passing.

Who is harmed by receiving wine via the mail? And who's business is it if I want to buy a wine that I've coveted for so long that is only available to me by asking it to be shipped? How can the state possibly find any interest in curtailing this act? Minors? Naw, that's not it. Taxes? Nope. The shipping of wine from out-of-state vendors doesn't make a dent in tax receipts. The possibility the wine is dangerous? That's no reason either. The laws are just plain dumb, discriminatory, and gifts to a a well-funded, money-infested, single-issue lobby. No law could be more stupid.

Well, smack me upside the head with a vibrator. I see I'm wrong.

The Supreme Court of the United States of America has let stand an Alabama law that prohibits the sale of sex toys.

Somehow the bans on direct shipping of wine don't' seem so monumentally stupid afterall.