The Rise (and Fall?) of Celebrity Wine

We live in the age of Celebrity.  People are celebrated for their achievements in sports, politics and the arts.  Some people are even celebrated for their lack of achievement — famous for being famous, as the saying goes.  I won’t name names, but you know what I mean. Celebrities are everyone — in the news, on TV and all around us through ads and product endorsements.

People Magazine’s Wine

Lil Jon

Lil Jon, Celebrity Winemaker

So we shouldn’t be surprised that there are celebrity wines, too.  Some wines simply use a celebrity name as a marketing tool.  I think the Martha Stewart label falls into this category (the wine is made by Gallo). Other celebrity wines are more than just marketing projects (although having a famous name doesn’t hurt).  The Fess Parker and Francis Ford Coppola wines come to mind here.

Celebrity wines are hot, or at least that’s what the indicators say.  People magazine features an article on celebrity wines in their November 10, 2008 issue.  People asked Gary Vaynerchuck, a celebrity wine critic, to rate the wines of four celebrity wine makers.  Hip-hop artist Lil Jon’s Little Jonathan Winery Chardonnay ($15.99) scored a solid 89 points.  Sopranos star Lorraine Bracco’s Italian-made Pinot Grigio ($11.99) earned an 86+ rating.  Mötley Crüe rocker Vince Neil’s $9 Petite Sirah is an 88-point good buy, Gary says.  And the $20 Victory Rosé from Olympic figure skater Peggy Fleming’s winery, Fleming-Jenkins, received 87 points. (Fleming donates $2 to breast cancer research for each bottle of this pink wine she sells — a use of celebrity clout that is difficult to criticize.)

The Nielsen Report

Maybe you aren’t entirely comfortable taking wine recommendations (or wine market analysis) from the pages of People magazine. If so, then a study released by The Nielsen Company (market research experts) might interest you.

The Nielsen data, which do not reflect the impact of the current economic crisis, indicate that grocery store sales of celebrity wine grew by nearly 19 percent in 2007, albeit from a low base (the celebrity wine category is still a small market segment — less than one percent).

The average price of the celebrity wines, $8.50, is higher than the supermarket average of $5.75, according to Nielsen. Unsurprisingly, the Nielsen report focuses on marketing and distribution (not the quality of the wines themselves) as the key factors driving sales growth.

“Several factors are fueling the growth of celebrity wines,” said Hurst.  “First, existing brands are expanding and gaining new distribution through new line extensions.  Second, more celebrities have launched their own brands in the past year or have had suppliers launch products under their names.   As these brands have proven themselves, they’ve gained distribution in other retail outlets, which has further stimulated growth.   And third, savvy marketers leverage the ‘celebrity’ benefit into expanded marketing programs via in-store vehicles, outdoor events and traditional and online media.”

Celebrity Wine Myths

Like the “critter wines” that they superficially resemble, celebrity wines are associated with a number of myths that should be briefly considered.

Myth #1: Celebrity wines are an American phenomenon. Alas, no.  One of the most famous celebrity winemakers is the French actor Gerard Depardieu, who now owns vineyards in Bordeaux, Languedoc, Spain, Morocco and Argentina in partnership with wine tycoon Bernard Magrez. Ernie Els, the South African golfer, has a line of wines from his home country, following the example set by Australian Greg Norman. New Zealand actor Sam Neil has an estate in Central Otago.

Myth #2: Celebrity wines are bad wines. No again, although I admit I haven’t tried very many of them.  The studies I have found suggest that celebrity wines are just like wines generally, you can find examples that are good, bad and maybe even a few that are ugly (hey — good, bad, ugly — that would make a great name for a line of Clint Eastwood wines!).  Because celebrities have an incentive to protect their personal “brands,” I suspect they try to avoid associating their names with really foul products. At least some of the celebrity winemakers take a real personal interest in their products, which is likely to make a difference in quality.

Some celebrity wines are excellent, which is easy to understand. Celebrity is a powerful force in today’s world and celebrity winemakers can often leverage their fame through connections and associations that contribute to wine quality.  You know what I mean — privileged access to quality grapes, personal advice from talented professionals, and so forth.  Football hero Drew Bledsoe is opening a winery called Doubleback in Wallla Walla, his hometown. I think he is bound to make good wine because so many wine professionals have taken an interest in it.  Wine people, even prominent ones, are only human and like to be associated with heroes and to participate in their projects. The wine can’t help but benefit form this attention.

Myth #3: Celebrity wines are bad for the wine business. Celebrity brands draw attention away from “real wine,” this argument goes, and only cheapen and commodify the idea of wine.  There is obviously some truth to this, especially if we consider multi-product lifestyle brands that have expanded to include a wine component in their portfolios– Martha Stewart, for example, and Sir Richard Branson’s Virgin empire. It seems to me that these associations diminish wine as a distinct product by reducing it to “just another” Martha S or Virgin label.

But most celebrity wines that I’ve seen don’t fit this mold and create a different kind of celebrity association.  These products may benefit the wine market by attracting new customers and encouraging wine drinkers to try new types of wine.  They also probably distort the market a bit, making it marginally more difficult for non-celebrity wines to get distribution in some market segments.  On balance, the influence of celebrities is probably positive since they draw public attention to wine.  Even the readers of People now know a little more about wine thanks to the Lil Jon piece.

The Future of Celebrity Wine

Prediction is difficult, economists like to say, especially about the future.  But I’ll hazard a guess about the future of celebrity wine.  As a category of wines I think celebrity wine will remain a small but vital niche.  Wine is part of society, so why should wine be excluded from the celebrity effect?

Some celebrity wines will thrive, but I don’t think it will be because of a famous name.  In the long run I believe that the quality of the wine is what matters.  I cite Fess Parker as evidence in this regard.  The wines are very good and speak for themselves.  The Fess Parker name and Davey Crockett association hardly matters after you’ve pulled the cork.

But most celebrity wines will rise and fall in sync with the notorious name on the label. Celebrity itself tends to be fleeting and I suspect that most celebrity wines will be here today and gone tomorrow, replaced by someone and something new. Fame’s famous quarter hour passes quickly these days as the media moves on to tomorrow’s headline and a new People profile appears.

[Note: Special thanks to Emily Gordon for bringing the People article to my attention.]

The Martha Stewart Wine System

march-2008-cover.jpgWine Enthusiast magazine celebrates its 20th anniversary with the March 2008 issue and editor and publisher Adam Strum reflects on the changing market in “The Enthusiast Corner” column. He writes that

“I’d like to think Wine Enthusiast played an important part in helping to bring wine to the attention of the American public at large, and not just the elite, over these 20 years. Wine magazines, books and the rise of food television have all undoubtedly played a role in making America a wine drinking nation. Other factors abound: American cuisine at home and in fine dining restaurants underwent a renaissance, and wine naturally became an important part of that. News of wine’s health benefits enlarged its consumer base. But most responsible for the growth of wine is the incredible leap in terms of overall quality at the same time that wine became more affordable. How often does that happen? Name me one consumer product that can compare.”

I think he is right in all this. Wine’s vigorous growth in the United States is a complex phenomenon. Many factors have contributed to the rise in per capita consumption in the United States and other New World markets at the same time that wine drinking has fallen dramatically in the Old World. The wine media’s role may be an under-appreciated element of this phenomenon.

The Supermarket as Home Depot with Wine

My friend Patrick works the wine aisle at a local upscale supermarket and he constantly delights me with his original insights into consumer behavior. He sees cable TV’s influence everywhere, for example. People watch Trading Spaces or the home remodeling network HGTV, he says, and run out to Home Depot for wallpaper and remodeling supplies. A huge industry has been built around their media-driven passion to renovate and restore. People watch the Food Network, he says, and run to supermarkets for exotic ingredients — and the wine to go with them. Wine is scattered throughout the store, not just in the wine aisle, to make the idea of a sophisticated meal (one that would please the Barefoot Contessa) a convenient choice.

Wine, in other words, is a lifestyle product that is promoted by lifestyle media like cable TV and lifestyle magazines that encourage and enable consumers to develop adventurous, sophisticated, consumption-driven identities. I don’t mean this in a bad way, although I know it sounds pretty bad. It’s just a fact. The magazine racks at Borders are filled with lifestyle magazines. You probably read a couple of them yourself. Even serious newspapers like the Wall Street Journal and Financial Times now have thinly disguised weekend “lifestyle” sections. Don’t pretend you don’t know what I mean!

Wine Enthusiast is a particularly good lifestyle magazine — there is a reason it has lasted 20 years. One factor in its success is that globalization has helped the wine market expand, providing more choice at affordable prices. Mr. Strum writes that

“New regions such as Australia, New Zealand, Chile, South Africa and others new to a global industry muscled their way on to the world stage. Competition drove improved methods in the winery and the vineyard. Competition also drove prices down at the middle and lower tiers.

“The world wine map has been redrawn so dramatically in the past 20 years it’s almost unrecognizable. Back then, it consisted of France, Italy, Spain and, way off in the margins, California. Now you must include Oregon and Washington State, not to mention the other New World countries I mentioned above. Every state in the union now produces wine. Countries like China and India are ramping up production in numbers that boggle the western mind.”

Martha Stewart Wine

Globalization has certainly made wine more interesting and wine drinkers can appreciate the value and variety. It would be a mistake to think that the wine media are passive observers of this phenomenon, however. It is in their interest to promote the industry that they cover and to try to profit from every aspect of it. You aren’t surprised when cable television networks expand outside the box, are you? They sell advertisements on their programs along with videos of the shows, books, lectures and assorted types of lifestyle paraphernalia. Think Martha Stewart! (And yes, there really is a Martha Stewart wine — made by Gallo).

Wine critic publications do the same thing — they have adapted the Martha Stewart System to lifestyle wine. I will focus on Wine Enthusiast here because it is their anniversary, but they are not an unusual example. Wine Spectator, Decanter, Gambero Rosso and most of the others have commercialized the wine experience in the spirit of Martha Stewart.

Mr. Strum describes Wine Enthusiast’s expansion this way

“Wine Enthusiast, as a company, has evolved dramatically over the past 20 years, too. In addition to the success of our catalog and our magazine, we have created an events division that is an astonishing success. We now annually produce four Toast of the Town events to introduce American consumers to wines that are available in their markets. These walk-around tastings, held in spectacular cultural venues, offer a sample of each city’s restaurants, accompanied by tastes of the portfolios of 70 wine companies. These events help educate and expand the palate of the American consumer, and to reinforce wine’s place at the table.”

Wine Enthusiast is more than a magazine, it is a lifestyle system. It sells magazines, of course, plus wine-related products through their catalog and website, produces wine events and so on. It informs, enlightens, educates and enables. A Wine Enthusiast cable network (or channel) would be the next logical step.

Even the magazine is commercialized in perhaps unexpected ways. Everyone knows that wine magazines sell lots of advertisements, of course. The editors always say that they don’t let advertising dollars influence their ratings, and I actually believe them — although market forces obviously do have some influence over the wines that they choose to consider for their reviews. National magazines need to pay attention to wines that are in national distribution. And these are the wines that are featured in the ads.

Wine Enthusiast takes one more step into commercial waters, however. The magazine includes a monthly Buying Guide that provides 100-point ratings and thumbnail reviews of dozens of wines. (I actually find their reviews to be very accurate, by the way.) But just before the long list of ratings there is section where a smaller number of wines are featured, with images of their labels for easy supermarket identification. These are the wines you will remember if you scan through the magazine quickly. I have always assumed that these were featured wines, selected by the editors for their good value or wide availability.

Imagine my surprise, then, when I started reading the fine print about how Wine Enthusiast rates wines and discovered that the labels are in fact “paid promotions.” Wineries can’t write the reviews or designate their products “best buys,” but they can pay to have them highlighted in the illustrated section! I wonder if that is true of other wine magazines? I’m going to be reading the fine print a lot more closely now so that I have a better idea of what is editorial content in the wine press and what is “paid promotion.”

Martha Stewart has only recently entered the wine business (with Paul Newman close behind), but it seems to me that the Martha Stewart system of total lifestyle marketing is already here. Hmmm. I wonder if that’s a good thing?