Natural Cork vs Alternative Closure Wars: Race to the [Wine Bottle] Top

At the end of my review of To Cork or Not to Cork, George Taber’s informative 2007 survey of the wine bottle closure wars, I vented some frustration. Not with the book, which is great, but with the closures themselves. Taber taught me that no wine bottle closure was perfect, although he had high hopes that competition among closure producers would make the future brighter. Here’s the conclusion of my 2007 column.

[Taber writes that]  … finding a solution to the wine closure dilemma is a worldwide problem and global market competition is forcing the stopper makers to innovate and make better and better closures and forcing winemakers to get better, too, since they can no longer automatically blame any flaws in their wines on bad corks. “Unfettered competition,” he writes, “remains a powerful driving force for good.”

I think Taber is right, but for now I’m just standing here in the basement, looking with suspicion at the wine in my little cellar, trying to guess what is going on beneath the lids. Having read Taber’s book, I now know enough to be anxious about each and every bottle!

A Wealth of  Closure Choices

Eight years have passed and the closure wars continue. Perhaps the single most-asked question when I speak to consumer groups is about what’s at the top of the bottle, not the contents. “What do you think of screw-caps?”  Well, what should I think?

The question continues to haunt the wine industry. Recently two U.S. wine industry monthlies featured cover stories on the closure wars. “Alternative Closures Go Upscale” was the headline on the May 2015 issue of Wine & Vines. while the June issue of Wine Business Monthly featured their 2015 “Closure Survey Report.”

Jane Firstenfeld’s Wines & Vines article “Unconventional Toppers for Top-Shelf Wines” takes the form of a series of brief interviews with premium winemakers who report their use of screw-cap closures (including Van Duzer, Chehalem, Meoimi, Silverado and Sonoma-Cutrer) or synthetic closures (Schug and Eberle).

The article gives a sense of the great variety of alternative closures available (gone are the days of one-size fits all) and the research and trials necessary to assure the best possible fit between wine, winemaker and closure. It’s a good piece of reporting if you have a dog in this fight!

Natural Cork is #1. So are Synthetic Closures. Discuss.

Curtis Phillips presents the results of the Wine Business Monthly survey of winery closure use in his article “Natural Closures Rated Highest.” One colorful graph caught my eye — it showed the results of the survey for five years where respondents were asked which closures they used for their $14-$25 red wines? Options (more than one choice allowed) started with natural cork and moved on to technical cork, synthetic closures, screw caps and an “other,” category that includes Zork and Vino-Seal.

The graph suggests that natural cork is used by about 50% of the wineries surveyed, down from nearly 70% a few years ago. Technical cork is shown rising from about 20% to 30%, while ynthetic closures are roughly stable at a little more than 10% and screw caps are shown rising from about 10% to 30%.

The devil is in the details in surveys like this and to their credit WBM provides details that clarify the picture. The unit of analysis for the survey is the winery whether it is big or small, which changes up the conclusions you might otherwise draw.

Many more wineries use natural cork, but many more bottles of wine here in the U.S. are sealed by synthetic closures. The 10% of wineries that use the synthetics such as Nomacorc include some boutiques (Oregon’s Ken Wright Cellars, for example) and some giants (Gallo), so that about half of all wine bottled in the U.S. comes with a synthetic closure even though only about 10% of wineries surveyed use it.

There is more to the WBM story than this, of course. Winery respondents were asked to give their ratings of closure alternatives and the result is a rising tide — all of the closures were rated higher than they were a few years ago. When it comes to quality in wine closures, the trend seems to be up and up.

Creative Destruction in the Closure World

This did not surprise me because closure manufacturers keep me well-supplied with press releases about their newest innovations and I have been impressed with the way that they have responded to criticisms and invested in improved technology giving wineries higher quality and greater choice. There has also been something of a shakeout taking place over the years, with some producers dropping out of the market, increasing the scale of the others, which further increases the return to new investment.

The race to the top is true for natural cork, as Antonio Amorim and Carlos de Jesus made sure I appreciated when I met with them in Porto last year.  Natural cork producers made a terrible mistake when they did not recognize problems in past years, and they paid a high price in lost market share as a result, Amorim told me.

But better consistency, higher technical quality and strong consumer acceptance makes natural cork a competitor in every market, he said. And of course better natural corks force the other closure makers to raise their game, too. Winemakers and wine consumers certainly gain.

If there’s one area where cork closures would seem to have an unavoidable disadvantage over screw-caps, however, it would be convenience. Screw caps are just easier to handle and, with rising technical quality, that would seem to give it a big advantage in some markets at least. Even wine guru Hugh Johnson thinks so. His  May 2015 column in Decanter magazine proclaimed that “I am faintly irritated now when I come to open a bottle of wine and find I need a corkscrew.” Gosh! The screw-cap is “incomparably better” than natural cork, he says.

Do the Twist — Like This!

Well, Amorim doesn’t want to lose Hugh Johnson’s business (or anyone else’s) so last year they released a screw-cork closure called Helix.  That’s right — screw-cork (see the image above). The cork and specially-made bottle are designed so that the cork screws into (and out of) the bottle slick as can be.

Screw-cork? Amazing.Probably not as important in the grand scheme of things as the technical improvements in cork production at Amorim, but still a great example of how innovation occurs even in centuries-old industries like cork closures.  Is this an example of Taber’s idea that unfettered competition is a driving force for for good? When it comes to closures, it sure seems to be true. Here’s to the race to the top!

Why Haven’t Corporations Crushed the Family Wine Business?

The featured essay in the current issue of The Economist newspaper focuses on family businesses and makes the case that they are a surprisingly robust feature of post-industrial capitalism.

This struck a note with me because the next two scheduled Wine Economist columns deal with different aspects of family wine businesses.  The Economist survey, which is written by Adrian Wooldridge, would make great background reading to what’s coming up here.

All in the [Wine] Family

The conventional wisdom, as The Economist explains, is that family businesses were a natural fit with early capitalism, when trust was at a premium and finance mainly came from within the family or the firm itself. The principal-agent problem can be mitigated somewhat if principal and agent are part of the same family unit. And family members can be more reliable (and patient) sources of finance than others.

There are problems with family firms, however, which are said to limit their scale, scope and longevity. One problem is generational transitions, which are often difficult (in business as is other aspects of life). The British have a saying that it is “clogs to clogs in three generations” as the dynamism that built the family firm is dissipated and the business eventually shrinks, fails, or falls into the hands of outsiders. You can probably think of examples of this from your own experience. I have heard it said that it is “shirtsleeves to shirtsleeves in three generations” here in the U.S. and it amounts to the same thing.

The conventional wisdom, descended from management guru Alfred Chandler and others, is that the modern company is increasingly rationalized and best run by highly-trained hired professional managers not hereditary top dogs. The irrational, unprofessional family necessarily plays a smaller and smaller role.

Talkin’ ‘Bout My Generations

The Economist makes the point that successful family companies have adapted in many ways. In some regions (Asia is highlighted) and some sectors, they have achieved conventional wisdom-busting dominance.  Under the right circumstances, it seems, family companies more than hold their own again publicly-traded competition.

Would it surprise you if I said that several of The Economist‘s examples of successful family firms come from the wine industry? I hope not, because that’s one of the themes I aim to explore in the next two columns. What wine companies get spotlighted? The first is very old indeed. The family behind Marchesi Antinori has been in the wine business for 26 generations. Giovanni di Piero Antinori entered the Florentine winemakers’s guild in 1385. That’s a lot of family wine history!

The second example is very different. The Economist cites Bernaud Arnault’s family ownership of Möet Hennessy Louis Vuitton. LVMH is a world class luxury goods conglomerate with substantial investment in wine and spirits brands, but I’m not sure if it is as much a multi-generation family company as a closely-held company (especially compared to the Antinori). But the success is still important and, as you will see, privately-held firms play a role in my analysis, too, and stand in general opposition to Chandler’s orthodoxy.

Another informative example of this type is the Rupert family of South Africa. The Ruperts have built a considerable luxury goods empire through their Richemont holding company. Richemont controls many familiar brands including Cartier and Alfred Dunhill. Anton Rupert was an important force in the development of the contemporary South African wine industry and the family is today well-known for its South African fine wine projects including Rupert & Rothschild, Antonij Rupert and La Motte.

Beyond the South Sea Bubble

The last example given is Berry Bros. & Rudd, the London fine wine merchant that has been in business since 1698. The discussion of BB&R focuses on the ability of families to ride out short term crises while keeping an eye on the horizon. Once your business has lived through the South Sea Bubble, seventh generation company chief Simon Berry quips, you are ready for whatever the modern economy throws at you.

Berry’s comment actually understates the situation because all business have to deal with the disruptive consequences of financial crises and macroeconomic cycles. The situation for wine businesses is even worse because wine is fundamentally an agricultural product and so is subject to natural harvest variations as well as boom-bust “cob-web” cycles of high prices, over-planting and decline or collapse. Any wine business — public, private or family — must navigate an unusually treacherous sea.

What’s the key to the success of family wine businesses? And what happens when family firms turn corporate? It’s impossible to generalize because there are so many diverse factors, but I think we can learn something from case studies. Come back next week for the family boom to corporate bust story of the Taylor Wine Company. Cheers!

>>><<<

This week’s Economist also includes a very short article about investing in wine.

>>><<<

Creative destruction? The Who ta-ta-ta-talk about their genereation.

Bisol’s Venissa: A Golden Wine of Venice

venissaLots of images come to mind when you think of Venice — the art, the architecture, and canals and gondolas. Vineyards? Not so much. Can’t imagine vineyards in Venice, although historians tell us that they were there — some even in the San Marco quarter — in earlier days when the city was less crowded and more concerned with self-sufficiency.

Would you be surprised if I told you that there are still vines and wines in Venice today? Not on the cluster of islands that we think of as the city of Venice proper, but out in the busy lagoon? The photo above shows the island of Burano (the island of lace-makers to distinguish it from Murano, the island of glass-makers) and just below it, connected by a short bridge, is the island of Mazzorbo and the one hectare vineyard of Venissa.

Golden Grape

Dorona di Venezia is a grape of the Venetian lagoon. — its natural resistance to fungal diseases is a plus in this humid place.  Known since the 15th century, it is a natural cross of Garganega and Bermestia Bianca (according to my copy of Wine Grapes) that is popular as a table grape  because of its big sweet golden (D’oro) grapes.

You can find Dorona here and there in the Veneto (easy to mistake it for Garganega, the grape most associated with Soave) but until recently not so much in Venice and its lagoon islands, the challenges of maritime grape-growing being what they are. But Gianluca Bisol, of the famous Prosecco house, discovered a few vines on the island of Sant’Erasmo and used them to establish a Dorona vineyard on the old ScarpaVolo estate property on nearby Mazzorbo.

Golden Wine

Golden grape, golden wine. The wine really is golden due in part to fermentation on the grape skins to give it special character. The bottles of hand-crafted glass display rich decorations of hand-beaten gold foil (thus honoring two traditional Venetian crafts). The name Venissa and a number are carefully hand-etched on each bottle.

What does it taste like? The note in Wine Grapes talks of minerality and dried peach and apricot.  Only two vintages have been released so far — 2010 and 2011 — and Ian D’Agata writes in his excellent Native Wine Grapes of Italy that he prefers the freshness of the 2011. Winemakers Desiderio Bisol and  Roberto Cipresso apparently pulled back from some of the extreme cellar practices after the first vintage, yielding a fresher wine, although not something that you would ever mistake for Soave!

We loved the color of the wine and were surprised by its delicate aromas. I found a certain saltiness very appealing, although maybe that was the power of suggestion since we were tasting the wine with Matteo Bisol looking out at the vineyard and the lagoon just beyond. If there really is a salty character, the wine comes by it naturally. Salt water floods the vineyards during periodic tidal surges and a good deal of effort goes into drainage. I preferred the more intense 2010, but maybe that’s to be expected of the author of  a book called Extreme Wine.

Venissa has just released a red wine, Rosso Venissa, its handcrafted bottle suitably adorned by copper, not gold. It’s a blend of Merlot and Carmenere from 40-year old vines located on an island near Torcello.  Sworn to secrecy, we tasted this wine prior to its official release and noted its richness, intensity and, well, salty personality.

soup

 Golden Opportunity

Not everyone would have seized the opportunity that those few stray Dorona vines presented, but Gianluca and now Matteo Bisol have done so and it is interesting to see the extremes that have resulted. The vineyard is a bit rustic, for example. Not the vines but the landscape, surrounded by stone walls, cut by drainage ditches and featuring a large rambling  garden where local senior citizens grow vegetables that they sell to the Venissa restaurant.

The restaurant and inn are as luxurious as the wine and present a strong contrast to the natural element that is appropriate for Venice. We dined at the restaurant and our waiter made the point that what came out of the kitchen (he pointed to the busy glass-walled show kitchen to our left) first came from the island and the lagoon to our right. This locavore idea appeared in each plate we were served, perhaps most of all in a soup of sea-snail (garusoli) and sea fennel in what tasted like the rich reduced essence  of the lagoon itself. Another extreme experience.

Making a Statement

On the ferry ride back to San Marco with the full moon above us, Sue and I talked about Venissa. I was suspicious at the start that it was a platform to promote the Bisol brand, but my hypothesis didn’t hold up. It really seems to be a sincere attempt by the Bisol family to honor the history and traditions of Venice and Venetian wine.P1090289

What makes Venissa so interesting is the ambitious approach. It would be possible to draw attention to Venetian wine culture with a museum exhibition of some sort — many wineries display collections of  winemaking implements, historical documents and wine and vine art. They are always interesting, but it seems to me that they usually lack the lasting impact that I see at Venissa. Why?

One factor is that Venissa is a living exhibition — the actual vineyards are right here in the lagoon, not just dots on an old map and the actual wine is in your glass not a just label on the wall. This obviously creates a more intense sensual experience. And the total project reinforces this by drawing on all the senses through the packaging, the location, the inn and restaurant and so forth.

Matteo told us that there are plans to further extend the experience through a sort of deconstructed hotel project on the neighboring island of Burano. The “hotel” would actually be a collection of rooms scattered around in various of the buildings that line the colorful canals of the little island, giving visitors an opportunity to intimately experience a different side of Venice and of course to enjoy the short stroll over the little bridge to Mazzorbo, then on through the vineyard and to Venissa itself.

Venissa is a wine, a destination and a statement, all made with impressive clarity and commitment. Congratulations to the Bisol family on this achievement.

Get Ready for the Wine Industry Financial Symposium

Sue and I have just returned from a week in Northern Italy as guests of the Valpolicella Consorzio (look for a series of industry reports on Valpolicella and Prosecco in the coming weeks) and now we are getting ready to head to Napa, California for the Wine Industry Financial Symposium that will be held there on September 22 and 23.

The theme of the symposium is “Let the Good Times Roll,” which will strike some as a bit off-key since the California headlines this year have been dominated by bad news — first drought and then the recent Napa earthquake. The program (see below) doesn’t sidestep the challenges, but seeks to put them into the context of a rising tide in the U.S. market. It should be an interesting couple of days!

Monday’s program features workshops that focus on specific issues of interest to wine industry professionals including the Hispanic wine market in the U.S., the rise of craft beer, the emerging talent gap in the wine industry, tax issues and vineyard finance.  Lots of interesting topics and great speakers — something for everyone.

The Tuesday morning program accentuates the positive, beginning with David Freed’s industry overview and ending just before lunch with Carolyn Wente and the celebration of 130 years of Wente Vineyards. In between Dr. Robert Smiley will present the results of his annual survey of wine industry CEOs and John Ciatti will report on U.S. and global harvest trends.

I will talk about “Lessons from the Global Wine Wars,” with an overview of important global market trends, focusing on two that I think are particularly relevant for the U.S. industry today: the “premiumization” of the wine market and the surge in “disintermediation” in the wine industry.

Tuesday afternoon features sessions on social media marketing, “next generation” consumers and wine distribution. Looking forward to hearing the speakers and seeing everyone in Napa next week. Here’s the complete program. Cheers!

>>><<<

Wine Industry Financial Symposium

Monday Workshops – September 22, 2014

Session I: 1:30 p.m. – 3:00 p.m. – Choose One

1. NEW DIRECT TO CONSUMER TRENDS
Examine new ways to relate to consumers through the direct to consumer channel. Speaker-moderator Craig Root will present several new tips designed to enhance your operation. Featured speaker Norman Stolzoff, President of Ethnographic Insight, will offer a detailed look at ethnographic research. This important field uses anthropological insights to solve real-world problems. Ethnography helps better serve customers, leading to profitable results.
Craig Root, Visitor Management Resources
Norman Stolzoff, PhD, President, Ethnographic Insight Inc.

2. TRANSACTIONS: WHO ARE THE BUYERS AND WHO ARE THE SELLERS?
John Mackie,
Partner, Carle, Mackie, Power & Ross, LLP, Moderator
Tony Correia, Owner, The Correia Company
Matt Franklin, Principal, Zepponi & Company
Josh Grace, Managing Director, International Wine Associates

3. THE HISPANIC WINE CONSUMER
What does it mean to the wine industry and what do we do to make wine the beverage of choice?
Steve Rannekleiv, Executive Director, Research, Rabobank International
Natalia Velikova, PhD., Texas Tech University

4. THE EMERGING TALENT GAP POSES RISKS FOR THE WINE INDUSTRY
Ray Johnson, Director of Wine Business Institute, Sonoma State University
Carol O’Hara, Partner, Burr, Pilger & Mayer, Moderator
Tom O’Brien, Director of Human Resources, Trinchero Family Estates
Larry Smith, Senior Vice President, Human Resources, Jackson Family Wines
Dawn Wofford, Managing Partner, Benchmark Consulting

Session II: 3:30 p.m. – 5:00 p.m. – Choose One

5. EQUITY AND DEBT MARKETS: CURRENT TRENDS AND FUTURE OUTLOOK
David Freed, Chairman, The Silverado Group
William Beyer, Principal, Prudential Agricultural Investments
Hal Forcey
, American AgAppraisal
Perry F. Deluca, Senior Vice President, Wine Industry Team Leader, Wells Fargo Bank

6. WHO IS THE COMPETITION? WILL CRAFT BEER AND CRAFT SPIRITS HURT WINE SALES, OR SHOULD YOU JUST JOIN THEM?
Bill Leigon, President, Jamieson Ranch Vineyards
Mark Crisler, CS, Founder & Chief Everything Officer, Trellis Wine Group
Jesus Ceja, Ceja Winery / Carneros Brewing Company

7. USE PERMITS: CURRENT ISSUES AND FUTURE TRENDS
Phillip Kalsched, Partner, Carle, Mackie, Power, Ross, LLP, Moderator
Dean Parsons, Project Review Manager, Sonoma County Permit & Resource Management Department
Jeff Redding, Principal, Land Use Environmental Planning Service
Beth Painter, Principal, Balance Planning

8. COMMON TAX ISSUES FOR VINEYARDS AND WINERIES
Federal Income Tax Updates, State Income Tax Updates, Sales Tax Updates and Estate Tax/Valuations
David Pardes, Tax Director, PricewaterhouseCoopers
George Famalett, Tax Partner, PricewaterhouseCoopers
Joan Armenta Roberts, Managing Director, PricewaterhouseCoopers
Eric W. Nath, ASA, Principal, Eric Nath & Associates
Thomas Garigliano, Tax Partner, Burr, Pilger & Mayer


Tuesday General Session – September 23, 2014
7:45 – 8:15 a.m.
COFFEE & REGISTRATION

8:15 – 8:20 a.m.
WELCOME & INTRODUCTIONS
Lisa Adams Walter, Director of Programs, Wine Industry Symposium Group

8:20 – 8:30 a.m.
WINE INDUSTRY OVERVIEW
David Freed, Chairman, The Silverado Group

8:30 – 9:15 a.m.
WHAT WINE INDUSTRY LEADERS THINK IS IMPORTANT FOR THE FUTURE
Robert Smiley, PhD, Dean and Professor Emeritus, Director of Wine
Graduate School of Management, University of California, Davis

9:15 – 10:00 a.m.
LESSONS FROM THE GLOBAL WINE WARS
Mike Veseth, Editor, The Wine Economist Blog

10:00 – 10:30 a.m.
GET – ACQUAINTED BREAK

10:30 – 11:15 a.m.
THE CALIFORNIA AND GLOBAL HARVEST UPDATE
John Ciatti, Broker, Ciatti Company LLC

11:15 a.m. – 12:00 noon
WENTE VINEYARDS CELEBRATES 130 YEARS
Carolyn Wente, CEO, Wente Vineyards

12:00 – 1:15 p.m.
NETWORKING LUNCHEON

1:15 – 2:15 p.m.
HOW SKILLFUL USAGE OF DIGITAL MARKETING AND SOCIAL MEDIA
NEED TO BE INTEGRATED IN THE BIGGER PICTURE OF BRAND BUILDING AND POSITIONING
John Gillespie, President, Wine Market Council and CEO, Wine Opinions
Karena Breslin, VP Digital Marketing, Constellation Brands
Alisa Joseph, Vice President, Business Development, The Nielsen Company
Mark Gordon, Digital Marketing Manager, Jackson Family Wines
Mike Osborn, Founder and VP Merchandising, Wine.com

2:15 – 3:00 p.m.
NEXT GENERATION WINE
Liz Thach, PhD, MW, Professor of Management and Wine Business, Sonoma State University
Judd Finkelstein, Judd’s Hill Winery
Lisa Broman Augustine, Broman Cellars
Nicole Bacigalupi Dericco, Bacigalupi Vineyards

3:00 – 4:00 p.m.
WINE AND DISTRIBUTION
Jonathan Pey, Principal, TEXTBOOK Napa Valley
Jon Moramarco, Principal, BW 166 LLC
Dan Grunbeck, EVP Corporate Business Development & Strategy, Youngs Market

4:00 – 5:00 p.m.
FINANCIAL SPONSOR FINALE
WINETASTING & RECEPTION – Hosted by WIFS Sponsors

 

American Association of Wine Economists Conference Program

As I noted last week, the American Association of Wine Economists are meeting in Walla Walla in a few days. I thought you might be interested in the full program, including papers, authors, activities and so on. Lots of interesting wine economics topics and ideas. Enjoy

JUNE 23, 2014 Whitman College, Maxey Hall

8:00 – 9:00

REGISTRATION, Maxey Auditorium Foyer

 

 9:00 – 10:30 Room – Maxey Auditorium  Session #1A: Consumers & Markets
Chair: XXX
Richard Belzer (Regulatory Checkbook) Leveraging consumer ignorance and information search costs to maximize profits in US wine ‘Flash sales': a follow up
Linda L. Lowry, Robin Back (both University of Massachusetts, Amherst) Impact of farm winery legislation S 2582: an act relative to economic development reorganization on Massachusetts wineries
Marc Dressler (University Ludwigshafen, Germany) Exploring success factors in export management – Results of a survey on relevance in the context of the wine business and performance of German producers
Olivier Gergaud (KEDGE Business School, Bordeaux, France), Philippe Masset (Ecole Hôtelière de Lausanne, Switzerland) Using information about web searches to forecast auction prices of fine wines

 

 9:00 – 10:30Room – Maxey 207  Session #1B: Tourism and Economic Impact
Chair: Luigi Galletto (University of Padova, Italy)
Christopher Lucha, Gustavo Ferreira, Martha Walker (all Virginia Polytechnic Institute and State University, Blacksburg) Virginia wine tourism: a profitability analysis
Luca Rossetto, Luigi Galletto (both University of Padova, Italy) Wine tourist profiles: a comparison between two wine routes in Veneto region
Theodore Lane (Western Regional Science Association), Bill Mundy (Bill Mundy Associates) Walla Walla’s wine-based agro-industrial cluster
Martin Prokes, Kamil Prokes (both Mendel University Brno, Czech Republic) Job creation by investing in the wine sector

 

10:30 – 11:00 Coffee Break
Maxey Auditorium Foyer

 

 11:00 – 12:30Room – Maxey Auditorium  Session #2A: Coffee & FoodChair: Morten Scholer (International Trade Centre, Geneva, Switzerland)
Morten Scholer (International Trade Centre, Geneva, Switzerland) Coffee: the product, the trade and comparison with wine
Samrawit Ebabe (Jimma University, Ethiopia) Constraints to Ethiopian coffee exports from a supply chain management perspective
Peter Roberts (Emory University) Product differentiation, pricing and fair trading in specialty coffee markets
Albert I. Ugochukwu University of Saskatchewan, Jill E. Hobbs. University of Saskatchewan Food product authenticity in agri-food markets: implications for collective reputation
Bernd Frick (University of Paderborn, Germany), Olivier Gergaud (KEDGE Business School, Bordeaux, France), Laure Salais (Institut Paul Bocuse, France) The demand for restaurants in Europe

 

 11:00 – 12:30Room – Maxey 207  Session #2B: Trade and International I
Chair: XXX
Alejandro Gennari, Jimena Estrella. Xavier Brevet (both National University of Cuyo, Mendoza, Argentina) Argentinean wineries’ strategies on export markets
Miguel A. Fierro, Rodrigo Romo Muñoz (both Universidad del Bío-Bío, Chile) Characterization of the Chilean bottled wine market
Cynthia Howson (University of Washington Tacoma), Pierre Ly (University of Puget Sound), Jeff Begun (University of Washington Tacoma) Grape procurement, land rights and industrial upgrading in the Chinese wine industry
Maryline Filippi (University of Bordeaux, France) Elena Garnevka (Massey University, New Zealand) Exporting wine to China from New Zealand and from France. Strategies and perspectives
 11:00 – 12:30Room – Maxey 307  Session #2C: U.S. Wine Market & Industry
Chair: XXX
Raphael Schirmer (University of Bordeaux, France) Drinking wine in the United States of America (from 1850 to the present) through the New York Public Library’s collection “What’s on the menu?”
Jon H. Hanf (Geisenheim University, Germany) Retail branding and its consequences on wine brands
Bradley Rickard (Cornell University), Olivier Gergaud (KEDGE Business School, Bordeaux, France), Hu Wenjing (Cornell University) Trade liberalization in the presence of domestic regulations: likely impacts of the TTIP on wine markets
Robert Hodgson (Fieldbrook Winery) The unimportance of terroir

 

12:30 – 14:00 Lunch Break

 

 14:00 – 15.15Room – Maxey Auditorium

 

PLENARY SESSION:
Welcome and Introduction
 Orley Ashenfelter (Princeton University)    Welcome and Introduction
     
Kevin Pogue (Whitman College)   The Terroirs of the Walla Walla Valley American Viticultural Area
15:15 – 15:45 Coffee Break
Maxey Auditorium Foyer
 15:45 – 18:00Room – Maxey Auditorium  Session #3A: Varietals, Geography, Environment
Chair: Julian Alston (UC Davis)
Kate Fuller, Julian Alston, Olena S. Sambucci. (all UC Davis) The value of powdery mildew resistance in grapes: evidence from California
Julian Alston (UC Davis), Kym Anderson (University of Adelaide) Evolving varietal distinctiveness of US wine regions: comparative evidence from a new global database
Christopher Bitter (University of Washington, Seattle) The evolving geography of the U.S. wine industry
Luigi Galletto, Federica Bianchin, Luigino Barisan (all University of Padova, Italy), Eugenio Pomarici (University of Naples Federico II, Italy) An evaluation of a new drought-resistant rootstock in Italy
Jean-Philippe Roby (Bordeaux Science Agro, France) Viticulture of varietal wines: the dead end of terroir at the time of global warming? Case study of Burgundy
Karl Storchmann (New York University), Peter Griffin (Vanderbilt University) Climate change and vineyard prices

 

 15:45 – 18:00Room – Maxey 207 Session #3B: Wine Investment
Chair: Lee Sanning (Whitman College)
Marie-Claude Pichery (Université de Bourgogne, France), Catherine Pivot (Université Jean Moulin – Lyon 3, France) Wine investment: a profitable alternative investment or simply a long-term pleasure?
Beysül Aytac, Thi Hong Van, Hoang, Cyrille Mandou (all Sup de Co Montpellier Business School, France) Wine: to drink or to invest? A study of wine as a financial asset in a French portfolio context
Philippe Masset, Jean-Philippe Weisskopf (both Ecole Hôtelière de Lausanne, Switzerland) Wine funds – an alternative turning sour?
Philippe Masset, Jean-Philippe Weisskopf (both  Ecole Hôtelière de Lausanne, Switzerland) Wine indices in practice: nicely labeled but slightly corked
Jean-Marie Cardebat (Université de Bordeaux, France), Benoît Faye, Eric Le Fur (both INSEEC Bordeaux, France), Philippe Masset (Ecole Hôtelière de Lausanne, Switzerland)  Is wine still an investable asset?
Benoît Faye, Eric Le Fur (both INSEEC Bordeaux, France) Dynamics of fine wine and asset prices: evidence from short- and long-run co-movements

 

 15:45 -18:00Room – Maxey 306  Session #3C: Quality and Experts IChair: XXX
Robin Golstein (Fearless Critic Media) Do more expensive things generally taste worse?
Omer Gokcekus, Clare Finnegan (both Seton Hall University) Lumping and splitting in expert ratings’ effect on wine prices
Neal Hulkower (McMinnville, OR) Information lost: the unbearable lightness of vintage charts
Ying Lou, Jing Cao, Lynne Stokes (all Southern Methodist University) Comparing measures of rater agreement for wine quality ratings
Dom Cicchetti (Yale University), Arnie Cicchetti (San Anselmo, CA) Assessing reliability when multiple judges taste a single wine
Eric Stuen, Jon Miller, Robert Stone (all University of Idaho) An analysis of consensus of prominent wine critic ratings in the US market
 19:00 – about 23.00
Conference Dinner
Long Shadows
Buses leave from Whitman College at 18:15  

 

 

JUNE 24, 2014 Maxey Hall

 

 9:00 – 10:30Room –Maxey Auditorium  Session #4A: Water, Whiskey, Wine, Food
Chair: XXX
Kevin W. Capehart (American University, Washington, DC) Fine water: a hedonic pricing approach
Ian B. Page (University of Maryland) The economics of whisky: an analysis of imperfect competition when product quality is endogenous
Kenneth Elzinga. University of Virginia, Carol Tremblay. Oregon State University, Victor Tremblay. Oregon State University Craft beer in the USA: history, scope and geography
Yohannes Yehabe (Molde University College, Norway) Assessment of weather impact on the sales of breweries in Norway: a panel data regression approach
Robert Harrington, Lobat Siahmakoun. (both University of Arkansas) Which wine and food elements drive high and low levels of perceived match?
 9:00 – 10:30Room – Maxey 207

 

Session #4B: Wine Demand
Chair:
XXX
Getnet Yitagesu (Unity University, Addis Ababa, Ethiopia) A principal component analysis of the demand structure of Wine. The Case of Addis Ababa
Paulina Rytkönen (Södertörn University, Sweden) Wine in a vodka country – changing consumption patterns in Sweden’s way from a rural to an industrial nation
Gary M. Thompson (Cornell University) Wine cellar optimization
Amy Holbrook, Dennis Reynolds (both Washington State University, Pullman) What effect does wine closure type have on perceptions of wine’s appearance, bouquet, Taste, and overall quality? An empirical investigation
Judit Szigeti (Ministry of Foreign Affairs, Hungary), Szilárd Podruzsik, Orsolya Fehér, Péter Gál (all Corvinus University of Budapest, Hungary) Wine affordability for the Hungarian consumers

 

10:30 – 11:00 Coffee Break
Maxey Auditorium Foyer
 9:00 – 10:30Room – Maxey Auditorium

 

Session #5A: Quality & Experts II
Chair: XXX
Adeline Alonso Ugaglia (Bordeaux Science Agro, France), Olivier Gergaud (KEDGE Business School, Bordeaux, France) Restaurant awards and financial rewards: Michelin
Guenter Schamel (Free University of Bolzano, Italy) Points for sale? Examining the market entry of a new wine guide
Orley Ashenfelter (Princeton University), Robin Goldstein (Fearless Critic Media), Craig Riddell (University of British Columbia, Vancouver) Do expert ratings measure quality? The case of restaurant wine lists
Robert Hodgson (Fieldbrook Winery) The fallacy of wine competitions; a ten year retrospective

 

 11:00 – 12:30Room – Maxey 207

 

Session #5B: Marketing
Chair: XXX
Steven Cuellar (Sonoma State University) Measuring the return to social media
Lindsey Higgins, Erica Llanos (both California Polytech, San Luis Obispo) A healthy, but confusing, indulgence? Wine consumers and the health benefits of wine
Benjamin C. Lawrence, Alex M. Susskind, Gary M.  Thompson (all Cornell University) Wine mailing lists
Jon H. Hanf, Oliver Gierig (both Geisenheim University, Germany) Discussion of an Innovative pricing strategy in the context of wine tastings

  

 11:00 – 12:30Room – Maxey 306

 

Session #5C: Industry Organization
Chair: XXX
Paulina Rytkönen (Södertörn University, Sweden) The Swedish wine industry – institutions, knowledge, temperance and regional development in an upcoming wine country
Betsy Carter (Max Planck Institute for the Study of Societies, Cologne, Germany) The state versus the market: patterns of producer politics and the construction of status markets
Marc Dressler (University Ludwigshafen, Germany) Organizational levers on reputation and performance – An empirical analysis of German wineries
Florine Livat (KEDGE Business School, Bordeaux, France), Jean-Marie Cardebat. (University of Bordeaux, France) Are there too many appellations in Bordeaux? A renewal of the brand vs. appellation debate
12:30 – 14:00 Lunch Break
 14:00 – 15.30Room – Maxey Auditorium

 

PLENARY SESSION:
Regulation in the U.S. Wine Industry                                 
 Orley Ashenfelter    Princeton University, Princeton
Paul Beveridge   Family Wineries of Washington State, Seattle
John Hinman   Hinman & Carmichael LLP, San Francisco
Allen Shoup   Long Shadows, Walla Walla

 

15:30 – 15:45 Coffee Break
Maxey Auditorium Foyer
 15:45 – 17:15Room – Maxey Auditorium  Session #6A: Supply
Chair: XXX
Nick Vink, Theo Kleynhans, Willem Hoffmann. (Stellenbosch University, South Africa) Financing wine barrels in South Africa: the Vincorp model
Alessandro Muscio, Gianluca Nardone, Antonio Stasi (all Università degli Studi di Foggia, Italy) Perceived technological regimes: an empirical analysis of the wine industry
Lindsey Higgins. Cal Poly, San Luis Obispo Economic stochastic simulation model for small to medium sized wineries
Julien Cadot (ISG Business School, France), Adeline Ugaglia (Bordeaux Sciences Agro, France) The horizon problem in Bordeaux wine cooperatives.

  

 15:45 – 17:15Room – XXX

 

Session #6B: International & Trade II
Chair: XXX
Joachim Ewert (University of Stellenbosch, South Africa), Jon H. Hanf, Erik Schweickert. (Geisenheim University, Germany) South African Cooperatives and the challenge of product quality
Silvia Gatti (University of Bologna, Italy) Designations of origin for wines, labor and cooperatives in Emilia-Romagna between the Censuses of Agriculture 2000 and 2010
Bo Gao, James L. Seale, Zhifeng Gao (all University of Florida) U.S. import demand for wine by country of origin: a differential approach
Leo-Paul Dana (Montpellier Business School, France), Mathieu Labadan (University of Pau, France), Michael Mettrick, Agate Ponder-Sutton. (both University of Canterbury, New Zealand) Interaction among wine makers in New Zealand
17:15 – 17:30 Coffee Break
Maxey Auditorium Foyer

 

 17:30 – 18:00Room – Maxey Auditorium  PLENARY SESSION:
Upshot and Outlook
 Karl Storchmann    New York University, New York

Alejandro Gennari
 
National University of Cuyo, Mendoza, Argentina

 

 19:00 – 23:00 
Dinner
Whitehouse Crawford, Walla Walla
JUNE 25, 2014 09:00 – 18:00
Tour of Walla Walla Vineyards and Wineries
Geological Guide: Kevin Pogue, Whitman College
Lunch at Basel Cellars
Buses leave from the Marcus Whitman Hotel at 9am

 

The Wine World Comes to Walla Walla

OK, so The World — the whole world! — is not really coming to Walla Walla, the lively wine town in Southeast Washington State, but the city and AVA are hosting two events that promise to draw participants from far and wide. Sue and I will be attending both, so we thought we’d fill you in.

The World of Syrah

2014 is the Walla Walla AVA’s 30th birthday and they are marking the occasion with a three-day program called Celebrate Walla Walla Valley Wine: The World of Syrah on June 19-21, 2014. Click on the link for details.

Walla Walla Syrah will be explored through a series of tastings, talks and dinners.  The inclusion of winemakers from outside the region (including Gary Mills from Australia’s Jamsheed winery) gives the event a global flair, but it must be said that the Walla Walla industry is pretty globalized itself, with influences and investment from the world over.

The Long Shadows winery, for example, features famous partner/flying winemakers from around the world, each of whom makes one wine in a distinctive style from Washington grapes. Michel Rolland, John Duval and Armin Diel are among the international winemakers here.

Some of the best known resident names in Walla Walla wine are international, too, such as Giles Nicault, Jean-Françoise Pellet, Marie-Eve Gilla and Christophe Baron. Walla Walla in intensely local and extremely global at the same time — just what I like!

Sue and I are fortunate to be part of a media group that will go behind he scenes to visit the vineyards, meet the wine people and get to know both the region’s Syrahs and its other wines as well. We are looking forward to the experience.

Wine Economists in Walla Walla

The American Association of Wine Economists will be in town June 22-25 for their annual meetings and we are looking forward to a lot of interesting papers and presentations. I expect to greet fellow wine economists from every continent except Antarctica at the meetings!

Click here to download the conference program, which includes dozens of presentations, a lecture on the region’s terroirs by geologist Kevin Pogue, a panel discussion of U.S. wine market regulation and a festive dinner at the Long Shadows winery.

The World of Syrah and the wine economists back-to-back meetings looks like a great opportunity for me to catch up with the wine’s global-local dynamic and for the world to take a closer look at this dynamic region. Look for future columns about what I learn.

Jamie Goode’s New Book: Second Thoughts on Wine Science

Jamie Goode, The Science of Wine: From Vine to Glass 2/e. University of California Press, 2014.

Jamie Goode’s 2005 book on The Science of Wine is one of my favorites — I’ve read it from cover to cover twice and I dip back in all the time to research specific topics. It seems like there is always more to learn and I enjoy Goode’s teaching style.

I was excited to receive a copy of the new edition and to see what’s new in this important field and how much of a revision the new book represents.

Vineyard to Cellar to Your Glass

The basic organization of the earlier edition is preserved. We begin “In the Vineyard,” move on “In the Winery” and finish with “Our Interaction with Wine” (these are the titles of the main sections of the book — I have copied the Tables of Contents of both volumes below for your reference.

g2

Table of Contents — 2014 edition

 

Once you drill down, however, the extent of the revisions become clear. New chapters replace some of the old ones (the chapter on GM vines is gone, with a new one on Phylloxera and ungrafted vines in its place) and there is much new wine in the old chapter bottles as Goode identifies new issues, reports new research, and brings in new perspectives.

Goode was still working his “day job” as a science editor when the original book appeared. Since then he has embraced wine writing as a full-time occupation and this book reflects his more intense focus as well as the many wine industry people he has met in his global travels. His interviews with them contribute to the analysis throughout.

Substitutes or Complements?

One thing that hasn’t changed from the first edition (a legacy of Goode’s editor days) is his clear and interesting writing style, even when things get quite technical, as they sometimes must in a book like this. One of Goode’s go-to methods is to identify an issue and then pick it apart by asking questions and answering them. Simple, but effective. You always know what he is talking about and why. Clear, direct — a good model for writing on any topic.

I read the second edition over the course of a couple of long air flights and like the first edition it held my interest all the way. But I think  it will be especially valuable as a reference book that you pull off the shelf as you try to answer troublesome questions or get up to speed on research quickly.

Both books are valuable, but does the second edition replace the first or complement it? I’m not sure. I was going to give my first edition away, but now I’m thinking about keeping it, since some issues in the old volume are not discussed in as much depth in the new. And I think it will be useful on some issues to compare and contrast the two volumes to analyze how Goode’s thinking (and the research that backs it up) changed over time. Highly recommended!

g1-002

Table of Contents – 2005 Edition

Follow

Get every new post delivered to your Inbox.

Join 2,190 other followers