Ants, Elephants and Washington Wine

I’m just back from the Washington Association of Wine Grape Growers annual meetings where I gave a talk about Wine Wars and its implications for Washington wine. Wine Wars focuses on global wine markets and the forces that are shaping them — what insights can it offer for Washington wine growers?

The Confidence Game

Wine Wars argues that reputation (and the value of  your brand) is an increasingly important factor in today’s crowded and competitive marketplace. No one has to buy your wine (or to buy wine at all given the many liquid alternatives). You have to stand for something (your reputation) and your brand has to reflect and effectively communicate that to break through the market noise. I call it The Confidence Game and reputation is a key strategy. That my friends is the Miracle of Two Buck Chuck that I talk about in Wine Wars.

But reputation and brands are complicated — a pretty obvious lesson that I only really learned a couple of weeks ago when I was at the Unified Wine & Grape Symposium in Sacramento.  My session (on The State of the Industry) examined the wine market from the global, international, national and California perspectives. After the session I was talking with a friend who has a 50,000+ case winery in Napa Valley. I think my business is important, he told me, but I today I felt like an ant in a room full of elephants.

Life in Ant-Ville

The U.S. wine industry is very large (and California dominates it, of course) but Napa Valley is just a thin stripe at the  bottom of the wine production bar graph (compared to the bigger producers elsewhere in the state) and my friend’s winery is only a small part of that. That’s ant-ville — nearly invisible — compared with elephant-land, the domain of the large scale producers and bulk wine trade (although 50,000+ cases is not at all insignificant in an absolute sense).

Washington is ant-town, too, I told my audience. (No offence intended! Ants are great creatures. They can carry many times their own weight. A colony of ants can probably strip an elephant carcass in a few hours. Ants are powerful collectively. But individually they are pretty don’t have much clout.)

Wine world ants need all the help they can get to get their brand or reputation out there. They need to have a strong private brand, of course, but they also need a strong regional brand (Napa Valley, for example) to create a reputational wave that the winery brand can ride. That’s one reason my friend’s winery is successful, even if it is just an ant in a crowded room.

Why Elephants are Different

Elephants are different these days — and it is not entirely by choice. Elephants (wineries that produce millions of cases) need strong brands, too, but increasingly they are being forced to distance themselves from regional brands such as AVAs and rely more and more on their own reputations. The reason? The emerging wine shortages that are forcing them to search far and wide for grapes and wine to fill their massive pipelines.

Years of stagnant vineyard expansion combined with rising demand have created a growing structural shortage of certain types of wine (bad news for those of us who have gotten used to deep wine discounts in the surplus years).

This is why so many wines that used to carry regional appellations are now forced to identify themselves as “California” wines. They need to blend wine from all over the state to fill their orders. Take a look at $8-$12 Zinfandels the next time you are in the supermarket and you will see what I mean.

The Logic of American Wine

“California” is a pretty broad appellation, but I am hearing rumbles from elephant land that increased use of the previously rare “American” appellation is in the cards. And expect more bulk wine imports (legally labeled to be sure) to make their way into bottles of wines you might reasonable suppose to hold All-American wine.

Is this a good thing? Well I’m not sure that it is good or bad — it’s just necessity. And I suppose it helps the ants with their stronger regional associations to differentiate themselves from the more generic elephants. But, on the other hand, the elephants’ promotion of regional brands in the past probably strengthened them, unintentionally benefiting local ants.

Since Washington wine is a teeming ant colony, it follows that it would benefit from a stronger regional brand. What is Brand Washington? Good question. (Paul Gregutt recently suggested how Brand Washington might be better promoted — click here to read his  column.)

[At this point my talk veered into a discussion of Brand Washington compared to Oregon, Napa Valley, Argentina and Chile. This part of the talk will have to wait for future Wine Economist post.]

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Another speaker joked that Ste Michelle Wine Estates (SMWE), which is by far Washington’s largest wine producer, is the state’s only elephant, but CEO Ted Baseler objected, citing the Wine Wars description of SMWE’s “string of pearls” (or chain-of-ants?) structure.

Who am I to disagree with Ted, especially since he was on the program to announce an exceptionally generous $1 million donation to help create a Wine Science Center on the Washington State University campus in wine country!

Thanks to WAWGG for inviting me to speak and special thanks to all the Wine Wars and Wine Economist readers I met at the conference.

Washington Brands vs Brand Washington

Lettie Teague’s column in today’s Wall Street Journal provokes a post on Washington wine’s identity crisis.

Teague writes in “Stalking the Wines of Washington” that the Washington wine industry has expanded rapidly in the last few years and that there are many great wines and great wine values. Yet Washington wines are hard to buy (she had trouble finding them in New York wine shops) and hard to sell (she quotes several winemakers in this regard, including Chris Camarda of Andrew Will, who is holding back wine and reducing capacity by 40%). What’s the problem?

I Can Get it for you Wholesale

Well, as in most cases, it is not a single thing but a confluence of forces at work. Although she says that fine wines from Washington have a reputation for good value, Teague suggests that many are currently over-priced relative to Napa Valley products. Judging from my email inbox, the reason for this is that a lot of Napa producers are selling off their wines at deeply-discounted prices.

The typical deal I am offered is “limited time only” 50% off the retail price plus discounted shipping. A great deal, except I can sometimes find even lower prices on these wines at local stores. The wholesale prices must be rock-bottom if wineries can do better with these low revenue direct sales. Teague writes that

One Washington winemaker lamented to me, “We can’t compete when Pahlmeyer Cabernet that used to be $90 a bottle is now $45 a bottle.” And so, while the quality has never been higher—Washington has had three excellent vintages (2006, 2007 and 2008)—the wines are getting harder and harder to find in stores outside of Washington state.

[Interestingly, some of the offers have six bottle limits — a psychological ploy in most cases, I think, to make customers believe that surplus wines are really quite scarce. Wine people tell me that it works every time.]

I think that Washington wines are still a great value, given their high quality, but deep discounting by the competition is never a good thing for producers.

Napa Valley vs Columbia Valley

The lack of a strong regional wine identity is a second issue that Teague identifies (she also cites the small scale of most Washington producers as a disadvantage). Everyone thinks they know what Napa Valley wine is (although it is a large and very varied AVA that produces lots of different types and styles of wine). Napa was a strong brand.

What is Washington wine?  Washington apples have a strong identity and Washington cherries, too. But Washington wine — not so much. A stronger, more prestigious identity could be a real advantage, especially in this economic climate, Teague notes.

… Napa Valley has just done a much better job of marketing itself, according to Marty Clubb, whose L’Ecole 41 Winery in Walla Walla is probably one of the best known and oldest (circa 1983) wineries in the state. “Nobody really knows where our wines are from. People recognize our brand but not as a Washington-state winery.”

Washington has well-known wine brands at nearly every price point from Columbia Crest to Quilceda Creek, but there is no well-established Brand Washington. This is an issue that Paul Gregutt identified in his terrific book,  Washington Wines & Wineries: The Essential Guide (watch for a second edition on bookstore shelves this fall). He interviewed leaders in the Washington wine industry about their vision for Brand Washington and, while most considered this an important issue, no consensus emerged.

I’ve heard that Allen Shoup (the godfather of Washington wine: former head of Chateau Ste Michelle, now the driving force at Long Shadows) wanted to promote the idea of the Columbia Valley as Washington’s equivalent of Napa Valley — building the Columbia Valley brand to compete with California.

But this plan ran into a collective action problem as individual producers invested in their own private brands and sub-AVA brands instead. I’m sure some buyers today see Columbia Valley as a generic designation, not the prestige brand originally envisioned. And I’m sure a lot of people don’t associate it with any particular place (some people still confuse Washington  State with Washington DC; maybe they think the Columbia Valley is in … Columbia!).

Although the lack of regional identity may be a serious issue in the long run, I think other problems are more pressing right now. After all, most of those deep discount emails I’m getting aren’t coming from Washington, they’re being sent out by famous wineries in famous Napa Valley.  A strong identity surely helps, but can’t completely compensate for competitive market forces.

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One area where Washignton’s wine identity is strong is in Riesling. Riesling Rendezvous — sponsored by Chateau Ste Michelle and Mosel’s Dr. Loosen, begins tomorrow. Riesling makers from around the world will gather near Seattle to discuss the problems and opportunities they face. Look for a Riesling Rendezvous post in the near future.

Wine Spectator 100: North and South

The lists of the Top 100 wines have started to appear — just in time for holiday buying. Wine Spectator released their Top 100 last week and now Wine Enthusiast has followed suit. Other lists are showing up, too, such as Paul Gregutt’s list of the 100 best Washington wines.  Fun and informative, these lists provide wine lovers with endless opportunities to discuss, debate and of course pull corks. Gotta love ‘em.

But you’ve gotta hate ‘em, too. Top 100 lists are a mixed blessing on the supply side of the market. Although they do promote wine and wine drinking generally, they necessarily privilege some wines over others and this is always problematic given the thousands and thousands of good wines that are produced each year. Why this wine and not that one? It’s an inevitable question that matters because wines on the list get more attention than the wines that don’t for some reason make the cut.

Dancing in the Streets

Top 100 lists slice up the market in many ways and this year my email inbox has revealed a North-South divide. Here in Washington State we are very happy with the 2009 Wine Spectator league table. Nine Washington wines made the list — more than any previous year — including the #1 spot, which went to the 2005 Columbia Crest Reserve Cabernet Sauvignon (95 points, $27 dollars). Two Oregon wines were also listed, so altogether this was a banner year for the Pacific Northwest.

While they are dancing in the streets in Woodinville and Walla Walla, the mood is more sober down south in Mendoza.  Two Argentinian wines appear on the WS100, which is welcome recognition of course, but that’s down from four last year. This is really Argentina’s year to shine in the U.S. wine market, with overall sales surging by more than 40% in dollar value according to Nielsen ScanTrack data. But only half as many WS100 wines! You can’t blame members of the Argentinian industry for kinda hoping to see their success more enthusiastically celebrated in the Top 100 lists. Hmmm. Maybe next year.

A Nobel Prize for Wine?

It seems to me that these top 100 wine lists are a little bit like the Nobel Peace Prize. Highly publicized awards like the Nobel and the Top 100  end up being both reflections of excellence and opportunities for the judges to send a message (political, economic or otherwise). There are many worthy nominees for each award so the final choice is always arbitrary — and the opportunity to send a message is irresistible. Or at least I wouldn’t be able to resist it.

There are obviously many factors that go into a Top 100 wine list and a wine’s objective quality  is just one of them. This is easy to see if you take numerical ratings seriously. The WS100 #1 wine this year earned a 95 score, for example, but the #2 wine received a higher score (96) and the #8 wine’s score was even higher (99). A 100-point wine was placed in the 21st spot last year. This is a numbers game but not just a numbers game.

Don’t Cry for Argentina

Wine Spectator uses four criteria in making their list: quality (the score), value (the price), availability (the volume) and excitement (the X-factor). The Columbia Crest wines (both the Reserve that won this year and their other wines) generally do very well on the first three factors year in and year out. The X-factor this year, I believe, was the recession and the desire to inspire some excitement among American buyers by giving them a #1 wine they could find and afford. That $27 Columbia Crest wine says that American wine drinkers can enjoy truly excellent wines at relatively affordable prices. Time to start pulling those corks! A good message to send in this economic climate.

What about Argentina? Well, I understand their situation. No problem with quality, volume or availability. But I think the market excitement is already there and doesn’t need any help from the wine lists at this point (as much as the Argentinian makers would love to have it). The U.S. industry (like President Obama?) could use some encouragement right now, which may be a good enough reason to draw attention to its outstanding, good value wines like the Columbia Crest Reserve.

Note: Congratulations to Juan Manuel Muñoz Oca, the 34-year old Argentinian winemaker who made the #1 Columbia Crest Washington State wine. What a great North-South connection!

Breaking In

I’ve written before about the British wine market, the most important marketplace in the world of wine.  Everyone wants a place on Britain’s Wine Wall, but breaking in isn’t easy to do, as a recent Decanter article and a conversation with one of my former students makes clear.

Decanter Discovers Washington Wine.

Many Washington winemakers are keen to try to get their feet in the door of European markets.  They figure that the time is right: the dollar is cheap and their wines are excellent. They cannot help but be pleased, therefore, with the July 2008 issue of Decanter magazine, which features an article about Washington wine by regional wine critic Paul Gregutt.  Three pages of text, maps, photos and wine reviews – it’s a nice package.  Several of the wineries mentioned even backed up the effort with two pages of advertising.  A really good display for Washington wines in the world’s most influential wine magazine.

But there’s a problem. British buyers know about these great wines now (more than ten wineries are mentioned including Columbia Crest, Seven Hills, L’Ecole 41 and Reininger), but only one (Columbia Crest) has current British distribution.  Want one of the other nine?  Call the winery in Washington State, the Decanter listing says. You’ve got to wonder how many buyers will do this and how many will just turn the page to the next New World wine – one that is actually available in Britain. You need publicity to get distribution, I know, but publicity without distribution doesn’t make the cash register ring.

On a different note, I have to wonder about the quoted price for the Columbia Crest Horse Heaven Hills Chardonnay.  Wine Spectator gives it 91 points and lists the price at $15.  The British price is apparently £19.53 or about two and a half times as much in dollar terms.!  It’s not going to be easy to break into European markets under these circumstances,

When Gallo Went to Europe

Gallo today is a classic American integrated wine multinational.  Although it is based in Modesto, in the heart of California’s Central Valley, and the bulk of its business is U.S. market, Gallo has complex international linkages.  Gallo sources wine from Italy, France, Australia and New Zealand and sells wine in Europe, Japan, and Latin America.  But it wasn’t always that way.  Gallo’s was drawn into the global marketplace in the 1980s, attracted by the markets in Britain and Germany.

I asked my former student Steve Emery to tell me what happened when these American wines (and American wine ideas) invaded Europe.  Steve is CEO of Earth2O, an Oregon company that bottles and distributes water from pristine Opal Springs near scenic Bend, but in the late 1980s he was Director of Sales for Gallo’s program to establish its varietal wines in England, Ireland and Germany.  His experiences say a lot about the nature of global wine then and now and the problems of breaking into new markets.

Getting Gallo into Europe was difficult, Steve told me, although ultimately successful.  Even though Gallo is a huge presence at home, it was an unknown quantity abroad.  I remember seeing Gallo wines on the shelf of my local wine shop when I taught in England in 1989 and I was surprised at the price point.  Gallo wines seemed expensive to me, about the same price as the most popular French and Italian wines on the shelves.  I expected Gallo to be a cheaper brand like it was at home.  But the advantage of lower price wasn’t really possible in the British market, given such obvious barriers as transportation costs and not-so-obvious hurdles such as the British wine tariff.

Many countries tax wine imports, whether to collect revenue, protect domestic winemakers, or try to shift consumption to other commodities such as local beers and spirits.  Britain is not unusual in this regard.  What makes Britain different is that the tax is relatively high and levied on a per-bottle basis (and only on non-EU wines, of course).  Britain collects more than $2 on each bottle of imported. (£1.29 according to a recent Rabobank report).  The flat per-bottle tax has a way of shifting the demand for wine towards more expensive products.  A $2 tax on a $2 wine represents a 100 percent tax. For a $4 wine, a $2 tax increases the price to $6, a 50 percent rise.  For a $10 wine, the tax raises the price to $12, only a 20% increase.  So the tariff falls heaviest on lower price goods and shifts the market upscale towards better or at least more expensive bottles and wines produced in the EU, not the New World. The cost advantage that Gallo enjoyed  in the United States was partially offset by the British tariff regime.

But that wasn’t the main problem, Steve told me.  The British supermarkets were savvy retailers – some of the wine buyers were highly trained Masters of Wine – the highest designation in wine education.  But they were organized to purchase and market wines based on geographic region rather than brand or type of wine.  As Steve says, they didn’t think in terms of brands (apart from the obvious fact of their own store brands).  This is true even today.  If you go into a Marks and Spencer store in Britain, you will find a world of wine available, but the wine is mainly organized and labeled according its place of origin rather than a US-style brand.  The wine’s “pedigree” (Friuli D.O.C. Grave Merlot, for example, or Macon Rouge, appellation Macon Rouge contrôlée) is listed in big letters, but the maker’s name and the brand – custom bottled for Marks and Spencer – are tiny by comparison.  The wines that Gallo sent to Europe were California wines, a useful geographic designation, but Gallo was the brand that defined the wine, not California.

British wine marketing was also different in other ways.  Steve told me that the British weren’t applying the basic Wine 101 lessons he learned with Gallo in the U.S. – lessons about where to put the most profitable wine (right at eye level on the shelf), where to position your target products in a wine cooler (on the right, where most people will look and reach first) and the many strategies of point-of-sale merchandising. They also introduced print advertising to the wine market successfully.

Gallo had to adapt, Steve said, to be successful in the foreign environment, even replacing the practical screw caps on its least expensive wines with more traditional cork closures (creating a shortage of corks in the process).

The German Problem

Germany was even more difficult, Steve said.  That’s easy to understand given the focus on bargain basement wines.  It doesn’t seem like most German buyers are interested in paying for a brand.  Low price seems to be the main factor and cheaper wines were readily available, Steve said, from Germany, Italy and France.  The supermarket wine buyers didn’t want to talk to him, Steve said, so Gallo resorted to guerrilla  marketing.  They got into the stores through the meat department, using a technique called cross-merchandising.  They sold the wine as the perfect accompaniment to beef, chicken and fish rather than wine alone.  Every meat purchase was therefore a potential wine sale as well.  You are probably familiar with cross-merchandising yourself, even if you’ve never heard the work before.  It is the process that has placed small displays of wine all over your supermarket, so that you never miss an opportunity to pair up wine with whatever you actually came to buy.  The Germans seem to understand cross-marketing very well now.  I visited my local Trader Joe’s this morning and found wine everywhere. I think there was probably more wine spread throughout the store than in the wine section itself.

The wine business is very competitive and Gallo found that the “rules of the game” were much different in Europe.  Wine is regulated as an alcoholic beverage in the U.S., so every aspect of its sales is subject to federal or state regulation.  In Europe, however, Steve said, wine is just another product and the competition is much freer.  That’s why he was able to bargain with the meat department managers in Germany rather than go through the wine buyer department.

Gallo was very successful in Britain and in Europe and many other American wine companies have followed them, but that hasn’t eliminated the challenge of breaking into new markets.  I wish our Washington winemakers good luck in their well-timed assault on the Old World markets. It’s not going to be easy.

Tyranny of the 100 Point Wine Scale

Wine rating systems are like the weather — everyone complains about them but no one does anything. Paul Gregutt thinks he knows why.

Wine by the Numbers

There are many ways to rate or rank different wines and consumers are very interested in trying to understand what they mean and how to use them. That’s why my column on wine rating systems, Wine by the Numbers, is one of the most popular posts in this blog’s brief history.

Twenty-point rating systems are popular in Europe in part, I understand, because that is how papers are graded in French high schools. Here in the United States the 100 point system that Robert Parker popularized and many others use dominates in part, I suppose, because that’s how our papers were graded in school. Any simple wine scoring system is problematic, however, since a good deal of information is necessarily lost when the attributes of a multidimensional product like wine are reduced to a single number. Wine isn’t like gasoline, where the critical components can be captured, like octane, in a single number.

But there are other problems, too. Paul Gregutt (PG), wine critic for the Seattle Times and Wine Enthusiast magazine, explained the limitations of the 100 point scale and the tendency toward “grade inflation” in his recent book, Washington Wines & Wineries:

This practice of promoting wine, a multi-faceted, subjective sensory experience, simply by broadcasting numbers has gradually devalued the numbers while shrinking the original 100-point scale. At first blush, such a rating system sounds generous, allowing room for a lot of subtlety in the grading curve. But in actual practice it’s not a hundred point scale at all, nor even close.

It has become a ten point scale. Wines rated under 85 are ignored completely. Wines rated 85 to 89 must be marketed as value wines – those numbers only work for wines priced at the low end of the scale. If your wine is going to sell for $15 or more, it must hit 90 points at least. One prominent retailer even makes a point of selling (at discount) wines that have scored the “dreaded” 89. Once a wine moves up the ladder from there, it becomes increasingly rare and expensive. As a result, wines scoring 95 or above are virtually unobtainable for the average consumer.

Although the ratings are “devalued” in terms of their utility, they are also “inflated” in terms of their commercial importance. It would seem that consumers might be better served if someone would re-center the scale so that it uses more of the 100 point range and is therefore potentially (and only potentially) a more accurate guide to quality. This would obviously lower the average score, however. Who is going to be the first to break the pattern and give merely good wines average scores, 70 or 75 instead of 85 so that 85 (B+) means something?

Revising the 100-Point Scale

PG decided to try in his book on Washignton wine. Instead of rating individual wines, he rated the wineries themselves in terms of a modified 100-point scale that gives marks for style (30 points), consistency (30 points), value (30 points) and the winery’s contribution to the development and improvement of the Washington wine industry (10 points).

How did the wineries rate? Quilceda Creek, with its perfect 100 Robert Parker point Cabernet Sauvignon, also got a perfect PG score (30/30/30/10). Leonetti ranked second with 98 points (30/28/30/10). So far so good. The trouble comes further down the list where some prominent wineries get scores in the 70s, 60s, and 50s. The scores make sense when you break them down into the four factors that PG evaluates, but the raw numbers are sort of shocking when you see them for the first time or out of context. (My university students know this feeling, I suspect. It happens when they get their first college papers back after several years of high school grade inflation.)

PG writes about the reaction to his winery rating on his website in a column titled “Time to Dump my 100 Point System?

Comments from readers and reviewers have been largely positive. Some have embraced my scoring; others have simply accepted it and moved on to the book’s other assets. But within the ranks of the industry itself – wineries and distributors in particular – there has been an awkward silence.

There is little doubt that this book’s sales have been seriously impacted by 1) the decision not to include 3/4 of this state’s wineries and 2) the scoring system itself. One winery veteran, after some prompting, took the trouble to explain why his winery wouldn’t sell or promote the book, even though I had given them one my highest scores.

“Our problem with promoting your book,” the winemaker said, “is that, in spite of the wonderful written praise, we’d spend all out time explaining our B+ grade.” PG is trying to decide if he should scrap his ratings for the next edition of his book (if you have an opinion you can contact Paul through his website PaulGregutt.com).

The First Mover Disadvantage

It is hard to know what to say about this. On one hand I admit that my first reaction to PG’s winery rating scale was neutral to negative, but then with some encouragement from Karen Wade I looked at it more closely and decided that it was actually pretty useful to me as a consumer — so I guess I am the source of some of the positive feedback PG received. On the other hand, I understand that no winemaker is going to take out an ad that boasts “Rated 72 by Critics!” — even if that’s a very good and appropriate rating by the scale being used.

I think we have to admit that re-centering the 100 point scale is a hopeless task and move on. The first mover in point reform will suffer the sort of criticism that PG reports. The only way to do it would be for everyone to switch scales at once. I don’t see that happening.

So what should we do about the ratings? For my part I’m going to try to get my students, who are very much into wine ratings by the time they come to me, to use the UC Davis 20-point scale. I think it might work because (1) they aren’t used to thinking in terms of 20 points and so they will have more open minds about what scores mean and (2) I like the way it breaks down elements of sensory perception: 4 points for appearance, 6 points for smell, 8 points for taste and 2 for overall harmony, according to my copy of The Taste of Wine by Emile Peynaud. Using the Davis scale will encourage them to make up their own minds about what they see, smell and taste. That’s a good thing.

In the meantime I think Paul Gregutt’s experience suggests both why the 100 point system should die and why it probably never will. My advice to Paul: keep the analysis in your book, which is terrific, but kiss the 100-point ratings goodbye.

Wine Critics Reviewed: Gambero Rosso

The first in a series on the actors and institutions that shape the wine world.

gambero.jpg

I’m interested in the role of wine critics (and their publications) in shaping the global wine market. This is the first of several entries that will examine a few of the most influential publications. I’m not entirely sure where this process will take me, but I’m pretty interested to find out what I will learn. So let’s begin.

I want to start with Gambero Rosso, which is a very influential Italian publication. It is the Italian equivalent of Wine Spectator, but it goes well beyond WS in its coverage of food and wine culture and tourism. It publishes a number of important guides to Italian regional restaurants, food and wine that I have found to be extremely useful when I have lived in or visited Italy. The Italian monthly magazine is physically imposing – the issue that appears in the photo above weighs in at more than 400 pages and was filled with ads. I subscribe to the much thinner abridged quarterly English edition, but my comments here concern the Italian original.

Birth of the Red Prawn

The name Gambero Rosso means red prawn, so it is easy to imagine that the magazine started out with a focus on seafood and expanded from there. The true explanation is a bit more Italian and a bit more political (I wrote about it in Chapter 7 of my book, Globaloney.) A group of young revolutionaries found themselves working on a Northern Italian newspaper called il manifesto in the 1970s. They formed a social club, which later evolved into the Slow Food movement, on the theory that political revolution needed to have deep social roots and to draw upon important economic sources in order to succeed (the status quo they opposed, after all, was political, social and economic, too). It is hard to imagine a better way to bring people into a political movement than through food and wine. And so their project thrived.

Gambero Rosso first appeared as a slim culinary supplement to il manifesto, so I imagine the name made reference to both its “red” politics and its shrimpy size. The magazine grew to become an independent publication, spawned a number of books and guides, and now even includes a television network. It is no shrimp any more.

Gambero Rosso is unique among the wine critic publications I am examining here in that it is almost entirely focused on the wines of a single nation, Italy. Although other publications may emphasize one country or region over others, all attempt some form of international coverage (this is even true of Wine Press Northwest, which covers the Washington, Oregon and British Columbia wine industries). In this as in many other things Gambero Rosso is different.

Mario Batali has said that there is no such thing as Italian cuisine, there are only the regional cuisines of Italy. Gambero Rosso takes this view of Italian wines, locating each wine within its particular region and quietly seeking to reinforce regional wine identities and to resist the industrialization and homogenization of wine. It thus holds true to its Slow Food roots. Gambero Rosso has an agenda, as its il manifesto origins might suggest, and it promotes it effectively by identifying the very best regional products and local producers. Other wine critics have agendas, too, I think, but are not always so transparent as Gambero Rosso.

The Italian Way of Wine

Each monthly issue of Gambero Rosso features a major section on wine, usually devoted to a particular regional wine. Winemaker profiles and interviews are accompanied by ratings and tasting notes. The ratings use the usual 100-point scale, although it is applied a bit more rigorously than in U.S. publications, I think, judging by the relatively small number of 90+ wines that appear. A surprisingly small number of wines are rated each month given the thousands and thousands of Italian wines produced. This is because the most important ratings appear in an annual guide called ViniD’Italia (one word), which is the bible of Italian wine. You can purchase an English translation, ItalianWines. The 2004 edition that I have here ran 864 pages and rated 14,208 wines from 1,937 producers. The new 2008 edition (due out later this month) is probably even bigger.

Several features of ViniD’Italia are noteworthy. First, it eschews the 100-point rating system in favor a simple scale of zero, one, two or three wine glasses. The three glass or tre bicchieri wines are the best in Italy. There were only 254 of them in 2004, so this really is a high distinction and I am sure it is a tremendous market advantage to receive the highest rating. I admit that I think the wineglass rating system is refreshing and usefully informative. Tasting wine is not really rocket science at my level of (un)sophistication. Robert Parker probably really can tell the difference between an 88-point merlot and one rated 87, but I’m not sure I can. Good, better and best ratings meet my needs pretty well.

ViniD’Italia is noteworthy in other ways in comparison with other wine guides I have seen. It is organized by wine region (and then by wine town) rather than wine type, producer or some other system. The idea seems to be that regional identity really counts and so you should be thinking about comparing wines based on their terroir and the qualities of the people who make them rather than just grape varietal or brand name (there is no emphasis on brands here at all). Within regions, each important producer gets a single page. Terse but data-packed text evaluates the winemaker’s progress since the last publication and surveys briefly the changes the tasters perceive. Then a small number of wines are rated and compared to some of the same wines from the same producer in previous years, with relative cost noted to provide a quick index of value.

(The focus on identifying quality producers (and not just exceptional wines) reminds me of the winery rating system that Paul Gregutt developed in his recent book about Washington wines. Click here to read my book review.)

If you want to know about the wines of Venica & Venica, for example, you turn to the chapter on the Friuli Venezia Giulia province, find their town, Dolegna del Collio, and learn that their reserve Tocai Friulano, the Ronco delle Cima, received three glasses for the 2002 vintage. Venica & Venica are quality producers, according to the text, and their wines are reliably good — you really cannot go wrong. One or another of their wines usually receives the highest rating and they generally receive several two glass ratings as well. This is useful information. (By the way, because of its geographical organization, this guide is a great resource if you plan to do any wine touring in Italy.)

A Critical Agenda

The book is frankly hard to use if you are standing in a wine store, flipping back and forth trying to find out how different wines (from different provinces and cities, made in different vintages) come out in the ratings. But I doubt that the editors really care. You are supposed to learn to use it their way, not your way. They want you to stop thinking about wines except in terms of their regional and local identities and to make more disciplined and informed choices, taking the long term development of quality producers into consideration.

The Gambero Rosso publications want you to think about wine in a particular way that reflects its original political agenda and distinctive Italian roots. In many ways it is exactly the opposite of the wine guide I’ll consider next, Decanter.

The California Bill and the Birth of Washington State Wine

I am spending this cold, wet day re-reading parts of Paul Gregutt’s great new book Washington Wines & Wineries: The Essential Guide (University of California Press) and his chapter on the history of Washington wine got me to thinking about the origins of the industry. Is it possible to point to any one person or event that is responsible for the birth of Washington wine?

There are several possible choices. Some would say that it happened in 1937 when Washington State University horticulturalist Dr. Walter Clore, the godfather of Washington wine, began working in his research center north of Prosser. Dr. Clore and his team are responsible for many of the advances in Washington viticulture that we take for granted today. Without Clore and his colleagues, Washington winegrowers might still be planting Muller-Thurgau and Concord grapes.

Others might argue that Washington wine was born in 1967 when Andre Tchelistcheff, the famous winemaker from California’s Beaulieu Vineyards, came to Washington and praised a Gewurztraminer made by Phil Church, a partner in Associated Vintners (now Columbia Winery). Tchelistcheff’s endorsement lent credibility to Washington wine and his encouragement helped propel the industry forward. (Tchelistcheff even encouraged his nephew Alex Golitizin to make wine in Washington — the result is Quilceda Creek Vintners, the maker of Washington’s first 100-point cabernet sauvignon.)

A third important event occurred in 1976, when the Chateau Ste. Michelle winery opened at the former Hollywood Farms location in Woodinville. The $6 million winery and headquarters complex was the largest single investment in the industry to that time and it represented a great gamble by Ste. Michelle’s corporate parent, the United States Tobacco Company (the makers and Skoal and Copenhagen smokeless tobacco). CSM, which was created through a merger of pioneer wineries Pomerelle and NAWICO before being purchased by US Tobacco, is now the Colossus of Washington wine, accounting for about 70 percent of all wine production in the state.

My choice for the key event in Washington wine history, however, didn’t happen in the vineyards with Dr. Clore or the tasting room with Mr. Tchelistcheff or at the grand opening of the Woodinville winery. From an economist’s viewpoint, the critical act (and it really was an Act) took place in March 1969. That’s when the Washington legislature passed House Bill 100, the California Wine Bill. The California Wine Bill exposed the Washington wine industry to competition from both domestic (California) and international competition and forced winemakers to improve quality or disappear.

Here’s the back story. Many wineries opened or reopened in Washington when Prohibition was repealed in 1933. Almost the first thing that they did was to seek protection from the state legislature from out-of-state competition. This protection was provided almost immediately in the form of the Steele Act of 1935, which set up a dual distribution system for wines. “Domestic” Washington wineries could sell directly to wholesalers, but “foreign” out-of-state wines (including wines from California) has to be distributed through the more rigid channels of the state liquor monopoly, the Washington State Liquor Board. The result was that “domestic” wines were relatively easy to purchase and widely available, but “foreign wines” including California products could only be purchased through state stores with their limited hours and strict controls. Later legislation provided for minimum prices in order to prevent competition from cheaper California wines.

The result of this protective legislation was exactly what you’d expect. With no competition to keep winemakers honest, quality suffered. The industry focused on the low end of the market, making large quantities of cheap, sweet, fortified wines like this NAWICO port. There was little incentive for winegrowers to seek quality (although some did) because good grapes and poor ones were all blended together. Although Dr. Clore was busy developing quality wine grapes in Prosser, Washington’s most important grape crop for many years was the Concord grape that went into Welch’s juice and Gallo’s sweet sparkling Cold Duck.

Rather than thriving behind its protective wall, the Washington wine industry collapsed. There were only eight wineries in Washington in 1969 (down from 42 in 1937) and, with a few exceptions such as Associated Vintners, their wine was mediocre at best.

The paradox that protecting a wine industry actually destroys it is not unique to Washington. I have seen it time and again in my research, in New Zealand, Argentina and in France under the EU’s old wine regime. The only thing that can protect a wine industry is competition, which forces winemakers to become more efficient and to raise quality.

With nothing to keep cheaper California wines out, Washington winemakers had no choice but to look upmarket. A quality wine industry emerged and has thrived — there are now more than 500 wineries in Washington state and new ones appear every month. Washington is unusual in the wine world in that it has developed a major wine industry that is not built upon a base of inexpensive bulk wine. Only New Zealand (which cannot compete with Australia at the bottom end of the market) and Washington can claim to have pure premium wine industries.

You can thank competition — and the California Wine Bill of 1969 — for Washington’s status as an important producer of premium wine.

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