The most famous explanation of international trade is David Ricardo’s Theory of Comparative Advantage. England can make both cloth and wine and so can Portugal, but they will both gain if England specializes in cloth and trades it for Portuguese wines on the basis of each country’s relative efficiency of production.
There are other trade theories if you aren’t satisfied with Comparative Advantage. One of my favorites is what you might call the Divine Will theory of trade, which holds that God distributed people and the stuff they want and need much differently so that they would be forced to trade or else do without. And trade, the theory holds, brings people together peacefully as Divine Will intends.
I hesitate to invoke Divine Will, but it certainly is true that the wine trade throughout history has been driven in part by the fact that population centers where wine is consumed and vineyard regions where wine is produced do not always coincide.
Getting the wine to consumers is a technical (and, because of taxes and other regulations, legal) problem that has been solved for better or worse over the centuries. The vast wine wall at your local upscale supermarket may not prove Divine Will but it certainly is an impressive achievement.
The growing industry of wine tourism, however, turns the problem on its head. Now the issue is how to get people to the sometimes far distant vineyards so that they can enjoy the experience. Back when wine tourism was just about cellar door sales this was a relatively modest problem, but today wine tourism is an important industry with economic multiplier effects that extend beyond the tasting room.
How do you give consumers a taste of the wine country experience if they are unable to get to wine country itself?
Real and Virtual Reality at Brancott Estate
I discovered one possible solution in an interesting article on the VeeR VR Blog. Marlborough’s Brancott Estate, which is part of the Pernod Ricard wine empire, partnered with Found Studio to create an experience of the “Red Shed,” named for the estate’s famous big red building that is the program’s home base (see video above).
Virtual visitors don VR headsets and can explore the vineyards and the shed and — in a rather remarkable innovation that I have not yet tried — actually sense something of the wines through scents that the headset releases at key moments. This prepares participants for the “real” reality experience of tasting the wines that follows the VR exploration.
This is obviously a pretty complicated way to bring wine country to the city or anywhere else and at this stage it probably risks becoming as much or more about the technology as the wine itself. But it also has the potential to surprise and delight in magical ways. Is this the wine tourism of the 4-D future? Probably one aspect of it and a glimpse of what the future might hold. Stay tuned — this could be pretty interesting.
Woodinville Wine Cluster
We found a second very interesting approach in Woodinville, Washington, which is located a short drive from Seattle and is a major wine tourism destination. There are precious few vineyards here (a few demonstration vines in front of Chateau Ste Michelle and a small Pinot Noir and Chardonnay vineyard at Hollywood Hills Vineyards). But there are more than 100 wineries and tasting rooms, forming a rather impressive wine industry cluster and wine tourism opportunity.
The wineries, following the production model set by Chateau Ste Michelle in the 1970s, truck grapes or grape juice over the Cascade Mountains from the Eastern Washington vineyards and make and package the wine close the market rather than close to the farms. Fast, efficient, refrigerated transport helps assure high quality raw materials and excellent final product. Some of the wineries are showcases like Chateau Ste Michelle while others are working spaces in the warehouse district. Taken together they made a successful industrial cluster.
Tasting rooms began to spring up alongside the wineries when, a few years ago, Washington law was changed to allow wineries to have off-site sales rooms in addition to their traditional cellar door facilities. Wineries based in the Yakima Valley, Red Mountain, the Walla Walla Valley, and elsewhere rushed to open tasting rooms in Woodinville, creating the wine tourism destination you see now.
Sue and I were accompanied by our friend Hermes Navarro del Valle, who is an expert on the global tourism industry with a special interest in wine tourism. It was interesting to see Woodinville through his eyes. We began our visit at Chateau Ste Michelle, which has recently opened a new visitor center that I will talk about next week.
Then we moved on to two of the several small wine tourism clusters, each of which features cafes or restaurants as well as a selection of tasting rooms. We stopped for lunch, for example, at The Bistro at the Hollywood Schoolhouse, a casual, friendly place with good food and a nice wine list. Then we walked a few steps to visit one of the half-dozen or so nearby tasting rooms. I wanted Hermes to taste the wines of Amavi and Pepperbridge from Walla Walla. especially and Amavi Syrah and the Pepperbridge Trine, which is one of the “Around the World in Eighty Wines” selections.
Hermes was excited by the possibilities he saw. If a tourist could get from Seattle to Woodinville, there were lots of eating and tasting options — easy to spend a day here learning about the wines. But he quickly focused on the problem of local transportation — getting around between and among the different winery and tasting room clusters was going to be problem. There needed to be some sort of shuttle that would circulate around the wine routes, he said. A good public-private investment for the local government, Hermes thought.
We glimpsed how that might develop when we moved on to a nearby cluster for our next visit. This space is anchored by a popular wine-themed restaurant called Purple and featured eight or nine tasting rooms with more just across the road.. We started at Fidelitas, which is one of our favorite. The tasting room manager turned out to be Will Hoppes, son of winemaker Charlie Hoppes, so we felt very much at home. Fidelitas is located on Red Mountain and we enjoyed sampling wines from the estate vineyard as well as Quintessence and Champoux vineyards.
As we settled into tasting we started chatting with another visitor, Mark Pembrooke, who is CEO of W3 Tours and may be the solution to the local transportation bottleneck that Hermes diagnosed. W3 Tours provides a variety of winery shuttle services in the Walla Walla Valley and Mark was in Woodinville working on a project to expand his shuttle services here.
If the shuttle service is successful it will take cars off the roads, easing the congestion that we have seen on peak weekends, and help tourists get the most out of their time. Mark said that he was grateful for the support of several wineries who benefit from his service in Walla Walla and have supported the expansion to Woodinville. Hermes was impressed with the entrepreneurship and suggested the next step: discount coupon books to encourage visitors to spend more time and money in the tasting rooms.
We had time for two more tasting room visits and I selected Brian Carter Cellars and DeLille Cellars, which were conveniently located on the other side of the compact parking lot from Fidelitas and next door to each other. They represent very different ideas of Washington wine, which is what I wanted Hermes to see and taste.
Cabernet Sauvignon and Bordeaux blends like the poplar D2 and elegant Four Flags Cab are what DeLille is known for while Brian Carter likes to source a diverse range of grape varieties s to make blends that often pay tribute other regions.
Hermes was particularly taken with a Brian Carter wine called Corrida (Spanish for bullfight), a blend of Tempranillo, Graciano, and Garnacha from the Columbia Valley. The wine was balanced and had great character. A fine way to end our tour.
Wine Tourism Cluster Advantages
We were able to experience something of the variety that Washington wine offers both in terms of terroir and varietal character in just a short span of time and space. And there were about 100 other opportunities available for our next visit.
All four of the tasting rooms we visited were warm and friendly and staffed by people who knew their stuff and could answer questions confidently. We appreciate their time and generous hospitality. The individual wineries and tasting rooms are working hard to build their markets and establish a successful wine tourism industry here.
Problems remain, of course. Traffic congestion on peak weekends can remind a visitor of Napa Valley, for example, and there is room for more hospitality infrastructure, too. And it might be possible that Woodinville has exceeded critical mass and there are now too many tasting rooms competing for the same customers for all of them to be successful. I will be interested to see if a new cluster appears in Seattle’s historic Pioneer Square neighborhood where Browne Family Vineyards is opening a tasting room nearby to The Estates Wine Room.
But you could see Hermes thinking that this might be a useful model for other parts of the world — Mendoza comes to mind — where the wineries and vineyards are far from town and distance limits the growth of the wine tourism industry.
As I noted above, our visit to Woodinville began with a tour of Chateau Ste Michelle’s new visitor center. Come back next week for details.
Video credit: Brancott Estate – ‘The Red Shed’ VR Experience from Found Studio on Vimeo.
Hi Mike, hope all is well. A little up date on Hollywood Hill Vineyards: Laurie and I are no longer involved, but remain friends with owners Steve and Becky Snyder. They contracted out the Vineyard last year but still have some 2015 Chard and Pinot Noir available if you ever want to taste Puget Sound AVA fruit. I hope all is well with you.
Thanks for the update, Karl!
Mike, when one spells the wrong word the right way, a spell-checker doesn’t help. Case in point: You wrote, “. . .partnered with Found Studio to great an experience of the “Red Shed,” named for. . .”
Am I correct in guessing that, instead of ‘great,’ you meant ‘create’?
Thanks for your always-interesting blog posts.
Warren Miller, CFA, CPA
Thanks, Warren. I found the typo a few hours after the posting and made the correction.. Always appreciate your help!
Hi Mike – you might want to adjust ‘Brancock Estate’ too….. guessing it wasn’t done on purpose!