The Changing Face of Wine in America: The Cooper’s Hawk Phenomenon

As I noted last week, wine is everywhere in America, or nearly so, and while it is common knowledge that the U.S. is the world’s largest wine market and that wine is produced in all 50 states, the diversity of the wine experience here sometimes comes as a surprise. Case in point …

What if I told you that one of the largest wineries in the U.S., home to what is probably the largest direct-to-consumer winery club program in the world, is based in Illinois, not California?

Illinois? (I can hear you saying this). No way! You’ve got to be kidding? Well, Cooper’s Hawk winery is no joke and learning about it helps us understand how wine is changing in the U.S. and where it could be going.

Top 50 U.S. Wineries

Wine Business Monthlys February 2018 issue lists the 50 largest wine companies in the U.S., from #1 Gallo (estimated production 70 million cases) to #50 McMannis Family Vineyards (340,000 cases). Most of the wineries are located in California as you would expect with a few exceptions such as Washington-based Ste Michelle Wine Estates (#8), #13 Precept Wine, and #36 Mesa Vineyards of Fort Stockton, Texas (550,000 cases).

Number 34 on the list with 570,000 case annual production and a wine club that is approaching 300,000 members is Cooper’s Hawk Winery and Restaurant of Woodridge, Illinois. All that wine is sold directly to restaurant patrons and wine club members. It is an interesting case study of wine’s growing (and changing) place in American culture.

A Wine-Centered Lifestyle Brand

The first Cooper’s Hawk location opened in 2005 and the chain, which identifies itself as a “lifestyle brand centered around wine” has grown to 30 stores in the  mid-west (Illinois, Indiana, Ohio, Michigan, Missouri, Wisconsin) plus Maryland, Virginia, and Florida. Five new locations are scheduled to open in 2018. A total of 4.4 million guests visited Cooper’s Hawk last year.

A Cooper’s Hawk experience combines several elements. It is a restaurant, of course, with a wide-ranging upscale menu that encourages patrons to think food and wine with a suggested pairing for each dish.  Bin 70 (Cooper’s Hawk Pinot Gris) is the suggested match for pan-roasted Baramundi, for example, and red wine braised short ribs are matched with Bin 04 (the Cooper’s Hawk Red, a Cab-Merlot-Syrah blend).

Ordering wine by the numbers rather than listing the wine names on the food menu is a way to keep things simple, rather like many people order by number from an Asian restaurant menu. You don’t necessarily need to speak wine to enjoy it at Cooper’s Hawk.

Each restaurant features a “Napa-style” wine tasting room and an “artisanal retail market,” where various food and lifestyle items are sold along with the Cooper’s Hawk wines. The idea is to bring the feel of a wine-country tasting room and restaurant to customers who are attracted to wine lifestyle experiences.

47 Varietieslux

A total of 47 different Cooper’s Hawk wines are listed on the online wine menu, divided into several categories, including International, Sparkling, White, Red, Sweet Red, Sangria, Fruit Wine, Dessert, Mulled Wine, Barrel Reserve, and top drawer Lux. As the video above indicates, grapes are trucked to the Illinois winery from California, Washington, Oregon, and other regions and the wines made, aged, bottled and shipped to Cooper’s Hawk stores.

Cooper’s Hawk invites its guests to embrace wine and gives them both broad choice and attractive pricing. Bottles of wine sell for what glasses of wine might go for at other restaurants. Retail shop prices begin at under $15 per bottle and top out at $39.99 for the Lux Pinot Noir. Restaurant prices are a bit higher, as you would expect, but the mark-up is surprisingly small. You can have that $40 retail Lux Pinot for $47.99 in the restaurant.

All 47 wines are available by the glass, with prices starting at less than $7. A glass of Lux Pinot Noir or Lux Meritage will cost you $13. How you view these prices depends on context, I think. If you are used to New York City restaurant prices, these wines are incredibly cheap — so cheap you might hesitate to try them. On the other hand, if lower-shelf supermarket wines are your reference, the prices might seem a bit high. It is clear from Cooper’s Hawk’s success,, however, that there is a sweet spot for an upscale casual dining restaurant wine list and they seem to have found it.

World’s Largest Wine Club?

One of the most interesting elements of the Cooper’s Hawk phenomenon is its wine club, which has nearly 300,000 members and is growing at a 25% per year rate. Guests who join the club are offered special “members only” wines plus invitations to various exclusive programs and events. Although there is an option to have monthly wine allocations shipped to your door, the pricing structure strongly encourages members to pick up their wines at the tasting room, which obviously produces repeated visits to the restaurant and reinforces the lifestyle relationship.

I am kind of fascinated by Cooper’s Hawk, which seems to have struck a chord with many American consumers by making wine the central element of a carefully crafted experience. I am therefore disappointed that I have so far been unable to visit one of the locations. Our travels take us many places, but so far the opportunity to belly up to a Cooper’s Hawk tasting room bar has eluded me.

But I have tasted a couple of the wines. The Cooper’s Hawk Lux Pinot Noir was the featured wine at this year’s Screen Actors Guild awards (Cooper’s Hawk is the official SAG wine partner) and we received samples of this wine plus the Lux Chardonnay, which were served at the event’s gala dinner, as part of the promotion of this partnership.

The details of the wines we received are a bit of a mystery — the Chardonnay and Pinot Noir are American appellation (not California or Oregon as you might expect). The Pinot was medium-bodied with a strong oak presence on the nose and palate that eventually faded to reveal varietal character. Perhaps the wine needed more time in the bottle to pull itself together or perhaps this is a winemaking decision to feature more oak on the premium product. The oak was nicely integrated in the Lux Chardonnay, on the other hand, and the wine was very enjoyable.

No one reads The Wine Economist for tasting notes, of course, and I’ve only sampled a couple of the wines. It is clear that these wines appeal to Cooper’s Hawk customers, who order them with meals and come back for more. Very impressive.

Cooper’s Hawk has achieved amazing success by creating or expanding a market that few of us imagined could be so large. Cooper’s Hawk recently announced and growing list of collaborations with famous wineries (Francis Ford Coppola, Boisset Collection) and celebrity chefs (Tyler Florence among others) that promise to expand the brand’s lifestyle appeal.

Is Cooper’s Hawk the future of American wine? No — wine is too complicated to have a single road ahead. But the Cooper’s Hawk phenomenon does suggest several important trails to explore — direct-to-consumer sales, focus on experience not just product, innovative marketing structures, and broadening the consumer base beyond the Wine Spectator reader “usual suspect” base to explicitly include Food Network viewers and foodies more generally. I think there’s a lot to learn about the market for wine in America from Cooper’s Hawk.

>>><<<

The Wine Economist will pause for a couple weeks while Sue and I are in France to participate in Terroir and Millésimes in Languedoc and Roussillion from April 15-22 and Val de Loire Millésimes from April 22-25. Looking forward to meeting fascinating people, drinking wonderful wines, and learning as much as we can. Full report to follow when we return and have had time to digest our experiences.

12 responses

  1. I own a small CA winery and visited a Cooper’s Hawk with curiosity recently while in the Midwest hosting wine dinners. They seem to have done a great job of tapping into the Cheesecake Factory demographic – large restaurants near upscale malls with an encyclopedic/diverse food menu and huge portions. The wine angle of their brand appeals to a segment of the market who may never make it to a “Napa” tasting room. Or, thought of differently, may never feel the need to if that itch can get scratched closer to home. Their model is innovative and very comfortable to those who are intimidated by wine-speak. The number one wine they sell is an almond-infused sparkler. How they manage to avoid tied-house rules with all those direct retail outlets is my question. The industry should not take them lightly as their approach has an obviously large market…

  2. The American appellation mystery on these bottles is a result of TTB labeling rules. Labeling a wine produced outside the state or a contiguous state to the grape source with the grape appellation is not allowed. In addition, you are not allowed to label ‘American’ appellation wines with a vintage date. I wonder if their wine club members care about this missing information on the label?

    • Thanks, Dwayne! My guess is that club members identify with Cooper’s Hawk and are interested in grape variety, but probably aren’t too concerned about where the grapes come from. Thanks again!

  3. Interestingly, CH’s location strategy for its restaurants is akin to early-century Sears or even early-days Wal-Mart: be where the less-sophisticated palates live. I haven’t been to a CH restaurant but see from their website they appear to be doing a lower-end *curation* play: educate, educate, educate. I love the *food-pairing* emphasis, since maybe one of ten people even think about varietal/food pairing.

    What’s more, I think it’s wise for brand-name producers to partner with CH such as *Coppola Collection*. Those less-sophisticated palates, as they are curated and gain more experience, will migrate from a CH restaurant to a retail store to purchase Coppola branded wines.

    Lastly, I think all of the wine industry ought to praise and support any entity that creates a business model that creates a positive, less-intimidating wine experience for customers eager to learn more.

  4. CH is an amazing business. In the course of some research, I visited a number of their restaurants a few years ago in the Chicago area. The decor was lovely. The food was adequate. The wine was adequate. But the business model is outstanding! We were asked several times throughout every meal if we’d like to join their wine club. As your article says, they now have 300,000 people who signed-up. Even at their lowest priced membership, CH is taking in $6M every month on the wine club alone, charged automatically to the members’ credit cards. And most of the folks come to the restaurant to pick up their club wine and, of course, then have dinner! Brilliant!

    • Dave, as you know, the business model of a winery selling directly through its restaurant and through its wine club only is not new as there are many examples of that out here in California. But this model, I believe, is more of a restaurant franchise/retail that makes wine but doesn’t grow wine. The wine version of BJ’s restaurants (craft beer), perhaps?

  5. We used to live in KY and visited a Cooper’s Hawk in Columbus Oh at Easton place. We loved it. Now we live in Houston Tx and there are no Cooper’s Hawk here sadly. If you ever consider opening one here, consider the south east Houston area called Clear Lake. It would do great here no doubts. Would love to become a member if we ever lived near a location. The food is wonderful and love the way they pair with wine selections.

  6. Very good article Mike. Glad that this operation caught your attention as I often stop at a Coopers Hawk on our one of Windy City Wine Tours around Chicago. My guests are never disappointed!

    Several of the comments have alluded to the fact that this wine is not comparable to well known high level domestic brands. That is correct.

    However, as one comment has said, the overall mix of creating a brand which consumers enjoy and come back for with regularity is very impressive. Nothing about the meal, the wine, or the ambiance is groundbreaking or worthy of note as an individual part, however the total package is wonderful and exceeds expectations which creates loyal repeat customers.

    The other important factor is that consumers in the wine club feel like they are getting great value and are educated in wine as part of the process. There is no snobbery to be found in a Cooper’s Hawk location and as a result, common folk do not feel intimidated or “dumb”. They are free to explore the world of wine at their own pace and in a manner which personally suits them.

    It should also be noted the the founder of Cooper’s Hawk, Tim McEnerey, worked at a local winery called Lynfred that has about five tasting rooms around suburban Chicago. Lynfred was founded in the early 70’s and has been making wine here in IL with imported grapes since that time. It too is a very successful operation, however, the Lynfred locations do not have restaurant operations. McEnery’s genius was to marry the food option with the wine option when creating his own model.

    Another notable part of the CH business model (akin to Southwest Airlines using just 737s) is that the wine is made in just one place (Countryside, IL just outside of Chicago) and then shipped in bulk to the various locations. This centralized method of production lowers costs and creates a uniform product that consumers can enjoy in any of the locations without any surprises.

    All in all, a very good operation that deserves the attention you have given it! Thanks for writing about wine in the Midwest!

    Dileep

  7. Hi Mike – super interesting article. thanks for sharing this story. PS if your travels bring you anywhere near Bordeaux this April please let me know. We would love to see you in Saussignac.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: