Boom Varietal: Film Festival Update

Boom Varietal: The Rise of Argentine Malbec, a documentary film produced by Kirk Ermisch and directed by Sky Pinnick, had its world premier last fall and has been on the independent film festival circuit since then, where it has earned several awards.

Boom Varietal is coming to the Seattle-Tacoma area in October as part of the Tacoma Film Festival. Local wine enthusiasts should make plans to attend the screening at 2pm on Saturday October 6 at the grand old Grand Cinema in Tacoma.

Boom Varietal is one of those films that seems to stimulate all your senses (and Kirk aims to make this literally true with a Malbec tasting and discussion after the film). It is certainly visually stunning with a beautiful soundtrack by Franchot Tone. And the story line should appeal to Wine Economist readers, too.

The tale of Malbec’s rise is about nature, history, people, passion and of course business — and that’s where I come in. I appear at several points in the film to sort of connect the dots. I was quite surprised by the amount of screen time I had when I first saw the film, but I guess it is an indication of how important economics is the world of wine today and how money connects people almost as well as wine!

I’ll be at the screening on October 6 — hope to see you there! Cheers!

Watch for Boom Varietal at these upcoming film festivals

Montana CINE International Film Festival 10/17-23
Rivers Edge International Film Festival 11/1-4
Napa Valley Film Festival 11/7-11

Book Review: New Bottles + Old Wine = Good Reading

A review of Howard G. Goldberg (editor), The New York Times Book of Wine (Stirling Epicure 2012) and Kevin Zraly’s Windows on the World Complete Wine Course (Stirling Epicure 2012).

Two new wine books have arrived on The Wine Economist doorstep. What they have in common is that they revise or repurpose some “vintage” wine writing. Does old wine [writing] in new bottles [books] work? Yes! And I recommend both books. But refilling bottles isn’t as easy as it looks and both books could have been a bit better. Herewith two brief tasting notes.

The Big Book of Wine

The New York Times Book of Wine is a real treat. It’s a big book (about 550 pages of text) that contains more than 150 articles taken from the pages of the New York Times over the last 30+ years, starting with some of Frank Prial’s wine columns back in the 1980s and stretching through Eric Asimov’s 2011 contributions.  It commemorates the 40th anniversary of regular wine writing at the Times and is, therefore,  a chronicle of my generation’s embrace of wine seen through the eyes of Asimov and Prial as well as Florence Fabricant, R.W. Apple, Jr., William Grimes, Frank Bruni and several others.

This is a fascinating collection and makes great browsing. Goldberg organized the pieces around themes such as “Wine Writing and Writers,” “What You Drink with What You Eat,” “South of the Equator,” “So, There You are in a Restaurant” and “A Magnum of Miscellany.”

At first I headed straight for the older articles because I love wine history and I see these columns as windows on the world of the past. I was going to skip the most recent articles because I read them all when they first appeared in the Times, but sure enough I was sucked in by the topics and the writing and the chance to contemplate them along side the older accounts. I spent a very pleasant summer afternoon in this book’s embrace.

Story-Telling Challenge

It’s a fine book, but it could have been even better. I have some experience with books like this, since I was editor of the New York Times 20th Century in Review: The Rise of Globalizationwhich appeared 10 years ago. I was given 100 years of everything in the Times — articles, editorials, op-eds, photos, cartoons, obituaries, etc. — and asked to tell the story of globalization from 1900-2000. My first impulse, given the vast quantity of material at my disposal, was to put things in piles — all the international trade stories here, all the financial crisis stories there, and so forth. But then I realized that I wasn’t telling a story, so I threw everything in the air and started over, trying to draw out the key threads that made the whole story make sense. I’m not sure how well it worked — there were more than 500 articles — but I tried to go beyond collecting and organizing to also tell an important story.

That’s what I miss in this wine volume. It’s great reading, but what’s the point? What do we learn about wine or about our society’s attitudes towards wine when we read 30 years of wine columns? Maybe there is no big story (although Asimov’s Foreword suggests that there is), just a collage of the individual authors and articles — a feast of tapas and sherries, as Goldberg writes in the Introduction. But I’d like to think that all this good writing adds up to something more. That’s the challenge I toss out for the expanded volume that I hope to see when the Times wine column celebrates its 50th anniversary.

Updating a Classic

Kevin Zraly’s Windows on the World Compete Wine Course is a big book, too, but in a different way. Zraly presents us with the vast panorama of whole world of wine. The book isn’t long (although you get your money’s worth in its 300+ pages) so much as heavy. The heavy paper stock that allows the color illustrations to be so clear and clean gives the book a real physical heft.

Zraly has been helping people learn about wine for more than 35 years and this book has been in print for as long as I can remember. The cover says that more than 3 million copies have been sold. The book is certainly comprehensive and interesting — the result of many years of fine tuning, I suspect — giving both the beginning and more advanced wine student something to master and something to think about. There’s a reason why it has been around so long.

I was interested in this new edition because it includes a number of features designed to appeal to today’s smart phone enabled wine enthusiast. This seems like a great idea — aren’t all publications moving in this direction? — and so I wanted to see how it would work? The answer is that it is a good beginning, but more work needs to be done to bring the iFeatures up to the level of the text itself.

There are three types of electronic features that can be accessed by scanning codes or entering URLs: introductory videos for the nine main sections, 1300 vocabulary audio files (to remove the fear of pronouncing Viognier) and links to the Sherry-Lehmann wine store’s online catalog to shop for the wines you have just read about.

Devil in the Details

The Sherry-Lehmann shopping links were the most successful and I think this is a nice service to provide readers, although I can understand why competing wine merchants might disagree. The audio files were more hit and miss. Most worked fine, but some were clearly mislabeled showing a lack of attention to detail. There were two “Willamette” links, for example, one of which pronounced the AVA “Yakima” instead of the Oregon name.  And although the “Chelam” link clearly pronounced the word “Chelam,” I am almost certain that “Chelan” — a Washington State AVA — is what should have been there.

The brief introductory videos were great to the extent that they gave me a real sense of Kevin Zraly himself and the passion he brings to his teaching. Really made me want to take a seminar from him. But they were just 60 seconds each and therefore hopelessly superficial.  They added something to each chapter, but they did not nearly rise to the potential that streaming video offers.  This needs to be better done or not at all.

While I am picking nits, I would like more documentation of the data (which is generously provided) in the book so I can track down the source and date for the many tables and charts provided (the footnotes could be provided via web link to keep the book from getting any heavier). Some of the data is dated and some of it needs more explanation — the footnotes would let the curious reader dig a bit deeper without getting in the way. OK, I’m a university professor, so naturally I would want more documentation. But I really think some readers would appreciate it.

Just as I challenged the Times editors to tell more of a story with their columns, I’d like to encourage Kevin Zraly and his team to try to more fully realize the potential of apps and web links and streaming video to expand, enrich and transform the wine education experience.

Naked Naked Naked Naked Wine

Maybe it’s just me. I’m kind of a modest guy but it seems like everywhere I look in the world of wine someone or something is getting undressed. I wonder where it will lead?

Naked Wine

It started with Alice Feiring’s 2011 book Naked Wine: Letting Grapes Do What Comes Naturally, which is an account of her attempt to make wine in the most natural way, with the smallest possible amount of intervention. The description on Amazon.com explains that

Naked wine is wine stripped down to its basics—wine as it was meant to be: wholesome, exciting, provocative, living, sensual, and pure. Naked, or natural, wine is the opposite of most New World wines today; Alice Feiring calls them “overripe, over-manipulated, and overblown” and makes her case that good (and possibly great) wine can still be made, if only winemakers would listen more to nature and less to marketers, and stop using additives and chemicals. But letting wine make itself is harder than it seems.

Three years ago, Feiring answered a dare to try her hand at natural winemaking. In Naked Wine,she details her adventure—sometimes calm, sometimes wild, always revealing—and peers into the nooks and crannies of today’s exciting, new (but centuries-old) world of natural wine.

The book is a contribution to the “natural wine” movement, which is both particularly active and controversial these days, especially in France where some wine bars specialize in the natural product while some critics argue that it is just an excuse for making bad wine. I love a good controversy, so the whole natural wine debate appeals to me.

But why not call the book “Natural Wine?” I guess publishers must think that “natural” doesn’t sell books (perhaps book buyers think — with some justification —  that all wines are natural). I noticed that when Jamie Goode and Sam Harrop published their excellent book on this topic then ended up calling it Authentic Wine not Natural Wine. Naked (or authentic) sells better than natural I guess.

Naked Naked Wine

More and more wines are made using organic and biodynamic practices, but they seldom advertise it prominently on the label. I think winemakers see the “natural wine” category as unnecessarily limiting and so choose not to position their products that way.

One that does is the range of Naked wines made by Snoqualmie Vineyards, one of the Ste Michelle Wines Estate wineries. There is a Naked Riesling as well as Naked Merlot, Cabernet Sauvignon, Chardonnay and Gewurztraminer.

“Although all of our wines are made with minimal intervention,” the website declares, ” grapes used in the Naked wine series are farmed as “au naturel” as possible. “Naked” is made with certified organically grown grapes in a certified organic facility. Very true to the varietal, these wines fit in perfectly with [winemaker Joy Anderson’s] philosophy that it is best to leave Mother Nature alone – let nature take her course and then try to capture the natural essence of the vineyard in the bottle.”

Naked Naked Naked Wine

A six-pack of naked wines arrived at our door last week and they weren’t from Snoqualmie or from Alice Feiring. They came from an online retailer called NakedWines.com Inc. NakedWines originated in Great Britain and is now online for the U.S. market.

The idea behind NakedWines is to go beyond just buying and re-selling wine (although the UK site does this, too, including some “flash” sales). NakedWines encourages its customers to become “angels” and invest $40 per month (£20 in the UK) in the particular small wineries that are associated with the company. Angels are repaid in the form of deeply discounted prices on the wines that their angel dust has made possible.

This is an interesting business model, sort of a cross between Wines.com and Kiva.org, the online micro-lending website. Here is an explanation from the UK website:

Good winemakers want to invest in quality and NOT waste funds on slick marketing campaigns. Your £20 a month makes it possible for them to do just that. They know their wine is sold before they’ve even grown the grapes, so they can invest all their time, money and energy in the vineyard crafting delicious wines, and pass the savings on to you.

NakedWines was founded by a former colleague of Virgin’s Richard Branson according to the Wikipedia page and is credited with being a pioneer in the use of social media marketing. I poked around the websites and failed to find an explanation for the “naked” part of the name. Perhaps it has something to do with stripping away the middleman’s profit or maybe it is just marketing meant to attract attention by introducing a risqué element. If so, they are not the only ones to think of this.

OMG: Naked Naked Naked Naked Wine

We visited the beautiful Columbia Gorge AVA during the recent Wine Bloggers’ Conference in Portland and I found myself sitting at a table with representatives of the Naked Winery & Orgasmic Wine Company of Hood River, Oregon. Their wines include Naked Merlot, Foreplay Chardonnay, Missionary Cabernet Sauvignon and Climax Red Table Wine. There is also a Virgin Chardonnay which presumably is not to be confused with their Penetration Cabernet.  (I’ll stop listing the wine names here to avoid getting a PG rating.) Customers are invited to “Get Naked” by sampling wines at the tasting room.

At Naked Winery, we aim to tease!  A family owned winery based out of Hood River Oregon, we are on a mission to produce premium class Washington and Oregon wines, with exotic brands and provocative back labels that are just a bit risqué. We aim to please the palate, change the conversation and enhance the romantic experience of wine.

We believe that the entire experience around wine should be fun. Read our back labels or have your mother-in-law read the back label aloud at your next family function. As we say, drink what you like and who wouldn’t like to get a little Naughty now and then? You can taste all three of our brands, Naked Wine, Orgasmic wine and coming soon, Outdoor Wino at our Hood River tasting room. Enjoy live music four nights a week and good company all year round. Come get Naked!

Clearly this wine is “naked” in a different sense than the others. Naked is a way to get people to let down their hair and be more relaxed about wine. To have a little fun. I understand that that the tasting room is a popular destination.

Whether it is serious or only a bit of a tease, this naked thing seems to be a very popular. I wonder what is next? Naked Naked Naked Naked Naked!

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Speaking of a tease, here’s the final video from The Naked Wine Show series. It is (apparently) the only show in the series where the reviewer was clothed.

Fluid Dynamics: Washington Wine & Spirits Update

“Washington Wine Sales in a ‘State of Flux'” — that’s that title of a recent article by Peter Mitham on the Wines & Vines website and I think Peter is right on the money. It’s a little like Bob Dylan’s “Ballad of a Thin Man:” You know something’s happening, but you don’t know what it is.

At least some Washington State voters are feeling that way. They voted to privatize spirit sales last year, assuming that increased competition would drive prices down.

Never assume, they tell you in school, and that would have been good advice in this case, since the combination of higher taxes and fees plus distributor mark-ups have pushed the price of spirits higher on average (for now at least) than under the state store system. Click on the link to Peter’s story to see exactly how this came about (and how it could “maybe” change in 2013).

Wine Does the Wave

It has been interesting to watch as waves of reaction and response have swept over the wine market. The first wave was all about geography — would the addition of spirits to retail store shelves reduce wine’s territory? The overall answer is probably yes, but different retailers adopted different strategies. Some held the line on wine and carved out new space for spirits. Others made room for spirit SKUs by cannibalizing the wine wall. And new entrants such as BevMo added space for both.

The ready availability of spirits was a novelty at first and I think some wine sales were replaced by spirit sales on that basis initially. The fact that spirit prices are higher than before means of course that wine is now relatively cheaper in Washington — and that should have increased wine sales to the extent that the two categories are substitutes, but I’m not sure that this has actually happened. No one has come up to me and gushed that wine is now a great bargain compared to vodka. So much for relative prices? Not so fast …

It’s All Relative (Prices, that is)

It’s been about three months since privatization and the price and geography factors are starting to stabilize, but the commodity composition of the wine wall is still quite fluid. We are seeing shifts in what types of wines and in what quantities are offered for sale.

One of the changes from the old regime is that distributors are able to offer case discounts or assess broken case premiums, which amount to the same thing. Essentially this means that the wholesale cost can in some cases depend on the volume that is purchased. This is business as usual in most parts of the retail world and in most parts of the U.S. wine market, but it’s a big change for us here in Washington.  The bottle cost was the same whether you bought one or a dozen under the prior regime.

So now the relative price of slow moving wine has increased relative to fast-selling stuff and this seems to be having an effect on the commodity composition of the wine wall.  Even where the total area allocated to wine has remained the same I am sensing somewhat fewer choices as the space allocated to higher volume products is increased and the low volume space shrinks accordingly. It’s as if someone imposed a tax on low volume wine.

If a winery offers six wines at similar cost and price points, but one sells much more quickly than the others and therefore justifies a discounted case purchase, well you can see the incentive to streamline purchasing. As Peter’s article suggests, this effect can be powerful in theory but it is very uneven in practice since not all distributors (or self-distributing local producers) offer volume discounts or charge extra for smaller lots.

So the wine selection hasn’t changed much at all at some wine shops, like Pike & Western, the excellent Seattle store profiled in the Wines & Vines article. But the transformation has been quite dramatic in other places and, of course, the big box stores change the game in others ways.

It is my sense (unconfirmed by hard data at this point) that the availability of small producer wines is at least somewhat diminished, but not uniformly so and that some retailers (such as Wine World & Spirits in Seattle) have stepped in to fill the gap by offering a larger selection of boutique wines. I was encouraging small producers to focus on direct sales (rather than relying on retail channels)  before the recent changes and I think this is still good advice.

Some Gotta Win[e], Some Gotta Lose?

So what’s the bottom line? Well, I’ve actually avoided writing about this topic for several months (despite reader pressure) because I wasn’t sure. And I’m still not. It seems to me that the shoes are still dropping and the evolution of the market is not finished.

I’ve written in the past that wine markets bear  certain superficial similarities to financial markets. One of these is the tendency to boom and bust and another is that price and quantity often “overshoot” in response to exogenous shocks. Both make it difficult to predict what will happen next.

Will the reforms ultimately be beneficial for wine in general and Washington wineries in particular?  Probably, but I’m reminded of the late Chinese Communist leader Zhou Enlai’s reply when asked about the historical significant of the 1789 French Revolution. Too soon to tell, he said. In the case of wine, we’ve got to wait for things to settle down and for good data to be available.

Even then it will be difficult to pick apart the positive and negative effects that can be attributed to the privatization policies and regulatory reforms because of everything else that is going on. The wine market is in a rising trend generally and wine sales would have increased even without any change in the laws.

At the same time, the margin pressures that I wrote about in the Tight, Fat and Uncorked series would have put pressure on retailers and distributors to streamline their product lines even if the laws were unchanged.  It will be tricky to separate these and other factors from the retail regulatory change effect.

Story Hour at the Wine Bloggers’ Conference

We are just back from the 2012 Wine Bloggers’ Conference, which was held this year in Portland, Oregon. It was a big event, with a sell-out 350 registered participants and about 40 more on the wait list hoping to get in. Randall Grahm gave one of the keynote addresses and Rex Pickett (author of Sideways and Vertical) gave the other. I was a moderator in a wine blogging workshop.

It was great to meet so many wine bloggers and to get a personal sense of the vast virtual community of wine enthusiasts who read, write and comment on the web.

Beyond Hegemony?

The conventional wisdom is that the days of traditional media’s hegemony in the world of wine are numbered (if not already passed) and that younger wine enthusiasts will increasingly draw their influences from social media (blogs, Facebook, Twitter and so on) and not Robert Parker or Wine Spectator.  The future of wine media might not be blogging, according to this viewpoint,  but wine blogs are part of the evolutionary process.

No one really knows if this is true or not, of course, and many wine bloggers secretly suspect that their readership is made up mainly of other wine bloggers. But the theory is just plausible enough to make wine blogging and a big conference like this difficult for the wine industry to ignore. So I was interested to see who would show up to try to develop relationships with the wine bloggers and how they’d go about it.

The list of wine industry groups in Portland is quite long. Here, for example, is a list of the official sponsors. And then there were other industry groups, wine producers, public relations firms and individual  Oregon wineries who had hospitality suites or organized pre- or post-conference events.

Grand Sponsors

Premier Sponsors

International Wine Night

Event Sponsors

Partners

Story Hour: High Oregon Art

Why did all these industry groups converge around the bloggers? Well, people might think that the wine business is about bottles and corks (and it is to be sure), but it is really about relationships and, more than that, it’s about story-telling. The wineries, wine businesses and regional wine groups were in Portland to tell their stories to the story-tellers and then hope that the message would spread. The fact that they would invest not insignificant resources to be at the conference says something about the importance of relationships and narratives in the wine business.

There are lots of ways to tell a story and some were certainly more successful than others. The Oregon wine industry did an excellent job by embedding their wines firmly in the culture of the region, giving the bloggers a sense of the values that the wines are meant to represent.

I’ve inserted above the short video that King Estate produced to be shown at the awards banquet, which they sponsored. It gives a good impression of the Oregon story generally as well as the particular philosophy of the King Estate family. Take this as an example of the high art of wine story telling (even though the wine itself plays only a cameo role in the video).

You can only imagine how effective it was when the video, which introduced the faces, places and values, was followed by the actual food and wine and the real people who made them. It and the other messages that Oregon producers and the Oregon Wine Board scripted cannot but have left a strong impression on the attendees. Bravo.

Rich Narratives: Wine Story Tasting Notes

Winebow, an important wine importer and distributor, also showed great story telling skills. Winebow’s sessions showed off two faces of their import portfolio very effectively.

The first program focused on the wines of Argentina (they import several brands including Bodega Catena Zapata and Bodegas Nieto Senetiner). Each wine was paired with a tasty bite and a story about the wine and food of the region. The variety of Argentinean wine was showcased along with the food and even the culture (we were treated to Tango dancers). The combination encouraged us to slow down and listen, think and talk about the wines and the country. If the story is that yes, Argentina is Malbec and steak (and this is a wonderful combination), but it is also much more, then I think it was told very well indeed.

The second Winebow session was about “Off the Beaten Path” wines and it showed off the depth of Winebow’s portfolio. I think it was my favorite part of the conference. Sheri Sauter Morano MW led us in a tasting of  seven wines that most of us had never tasted before and that many consumers would hesitate to try because of their unfamiliar names or place of origin. As I have written before, wine is ironically one of the least transparent everyday products and the uncertainty about what is in the bottle is a limiting factor in wine sales and wine enjoyment.

Sheri focused on the story-telling aspect. She had us taste the wines “blind” and asked us to think about how we would describe them and tell their stories to readers. What reference points (in terms of more familiar wines or other qualities) could we use and how might we distinguish their signal qualities? The “reveal” provided additional information about each wine and challenged us: How could we tell the wines’ stories in a way that would resonate with readers and allow them to have the same interesting and enjoyable wine experience? I thought this was a brilliant approach and I hope some of the bloggers embrace it to introduce their readers to new wine varieties and regions.

Food Truck Wine?

Wines of Chile is another skilled story-teller. I have worked with them on several projects and have always been impressed with their commitment to developing their brand message and their focus on social media strategies. They invited us to a participate in a pre-conference tasting that was a sort of moveable feast. About 20 of us boarded a double-decker London bus and visited three local venues (including an iconic Portland gourmet food truck cluster) where small plates of food were paired with particular Chilean wines. It was a very effective way to feature the wines and an opportunity  to provide detailed and relevant information.

Taking all of the events together, including pre- and post-conference events and the chaotic “live-blogging” tasting events, I think most  New World and Old World wine regions were represented in one way or another. Who has missing? I’m not sure I saw any wines or literature from either Austria or South Africa but I admit they could have been there and I just missed them. And of course if would be impossible for all the different wine regions of France, Italy  or Spain to be present, but the national industries were well represented by the groups that did attend.

Bloggers need stories to tell and the wine industry needs story-tellers. No wonder everyone got on so well together at this conference.

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Thanks to all the sponsors who made the Wine Bloggers’ Conference possible. For more information I recommend Tom Wark’s  assessment of the conference. I agree with Tom about most things, especially the value of real person-to-person face-time versus Facebook and Twitter.

Summer Reading: Simpson on “Creating Wine”

Summer a a good season to kick back and do a little reading (the other good seasons for this are Winter, Spring and Fall). Serious reading? Fun? I dunno — it’s up to you. A local newspaper columnist has added Wine Wars to his summer business book reading list (along with Daniel Yergin’s The Quest and The Great A&P and the Struggle for Small Business in America by Marc Levinson among others). Sounds like serious fun to me.

So what am I reading for serious fun this summer? The answer is Creating Wine by James Simpson (Princeton University Press, 2011).

A Book and Its Cover

Please do not judge Creating Wine by its cover. The main title plus the illustrations of two grape vines might suggest that this is a book about practical viticulture or perhaps home winemaking. The devil is in the details and in this case the truth is in the subtitle (The Emergence of a World Industry 1840-1914). This is the story of how the world wine business evolved in the critical years before war in Europe and Prohibition in the United States when the roots of today’s global industry were established.

The story told here is how different wine regions adjusted to exogenous shocks (such as the Phylloxera scourge) and disruptive technological change (such as improved transportation) and how these differential responses set the industries on courses that still vary today.

Significantly, Simpson finds his explanations for the New World – Old World gap not simply in history or culture, but instead in differences in relative factor abundancies (land scare Old World, labor scarce New World) and differing patterns of political and economic power.

Old World and New

This is an economic analysis  (the author is professor of economic history at the Carlos III University of Madrid) so, although there are no equations, there are plenty of useful tables and charts, which add to the story. And although it wouldn’t hurt to have taken an introductory economics class to understand some of the terminology, I don’t think this is a firm pre-requisite.

Part I focuses on Europe and particularly France and introduces in quick succession the problems of the railroads (19th century globalization), Phylloxera and the development of viticultural science, and the political economy of the response to fraud caused in part by Phylloxera-driven shortages of wine grapes.

The rest of the book examines Europe’s failure to penetrate export markets (especially the U.K.) followed by comparative analyses of the evolving wine industries in Bordeaux, Champagne, Spain, Portugal, the U.S., Australia and Argentina. A final chapter brings things forward to the present.

I enjoyed this book because of the way it helped me make connections. In every chapter I found two or three interesting facts that I already knew and then Simpson supplied the key connecting idea. Suddenly it all made sense! A very satisfying (and informative) read.

Chinese Workers in California Wine

Let me pick one example to illustrate. Thousands of Chinese workers came to the United States in the 19th century to help build the transcontinental railroad. Many remained, especially on the West Coast, after the Golden Spike was driven home. Cheap, hardworking and quick to master new skills, they became the backbone of the California wine industry.

But economic conditions changed and anti-Chinese attitudes emerged and many were driven from the country; an underlying labor shortage was revealed, only partially bridged by fresh immigrants from Italy and other European countries. The problem of scarce and expensive labor became the defining economic constraint of American wine, Simpson tells us (just as the uneconomic division and re-division of European vineyards over time defined Old World wine economics).

The technical innovation of a “vertical” winery, where the force of gravity moved the grapes and juice from one part of the production process to the next, was created to economize on labor, Simpson says, not just to provide more gentle treatment of the grapes as a dozen wine tour guides must have told me over the years.

Creating Wine is a great book for anyone who loves wine economics, wine history or … wine! Highly recommended for a seriously fun summer read.

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Note: The Jake Lee painting of Chinese vineyard and winery workers in Sonoma County shown here was originally displayed in Kan’s Chinese Restaurant in San Francisco. Click here to read its fascinating history.

Wine Tourism à la Française

My colleague Pierre has returned from visiting his parents in Toulouse and he brought with him the May 2012 special wine tourism issue of La Revue du Vin de France,  which features “Les 35 meilleurs circuits du vin.” Since I’m working on the wine tourism chapter of my next book I couldn’t wait to dig in.

So what are the 35 best wine tourism destinations? Well, given the French readership of La Revue it should be no surprise that 29 of them are in France itself. I’m sure that if Wine Spectator were to pick out the best wine touring routes there would be an American bias (out of practical concern if nothing else) although it might not so extreme as this French case.

Tour de France

I sensed a diplomatic hand at work in making the selection as virtually every important wine region in France is singled out in one way or another. I think you could organize a Tour de France-style bicycle race from these wine tourism suggestion (Le Tour typically touches every corner of France). If you did, I suppose you’d want to stock up on Boisset’s Yellow Jersey wine, made in tribute to the great race  — the plastic container fits neatly in your bicycle’s water bottle cage.

Even Paris makes the wine tour list. You might wonder at this because vineyards are not frequently seen on Parisian hillsides, but that’s not why wine tourists go to Paris. It’s the shops and wine bars that are the attraction here. 

So La Revue directs you to visit Galeries Lafayette in the IX arrondissement to see the magnificent collection (“12000 bouteilles en cave”) of Bordeaux wines there.  Other shops are recommended for unrivaled access to wines from Burdundy, Champagne and Languedoc and imported wines, too, from Germany, Hungary and Spain.

Follow the Wine

Although the idea that Paris is a wine tourist destination felt wrong at first, I can see the attraction. Follow the money, Deep Throat said. Follow the wine is good advice, too, and sometimes the best collections of wine are far from the sunny vineyard slopes (but close to where the money resides).

I am particularly interested in La Revue’s selection of wine tourism destinations outside of France. I expected to see Napa Valley on the list; Napa is the second largest tourist destination of any kind in California (after Disneyland) and so certainly the largest wine tourism center in the United States. But it didn’t make the La Revue cut.

Easy to understand, I suppose. When the French visit the United States they may not be thinking of wine. New York, Miami, Los Angeles and maybe Los Vegas — these are the most common European tourist targets I have heard. American wine country is a bit off that map. Or at least it is off La Revue’s map for 2012.

Porto in Portugal did make the list, however, along with Tuscany, Vienna, Geneva, the Rhine Valley and Cape Town, South Africa. Cape Town is a spectacularly good choice for wine tourism, of course, and any list of the top global wine destinations would have to include Tuscany and Germany.

But the competition for the final spots must have been pretty fierce and it would be interesting to know how Vienna and Geneva beat out New Zealand, Australia, Chile and Argentina (not to mention Napa and Sonoma). There are many amazing wine tourist destinations and choosing just six outside of France (or choosing just 29 inside France) is necessarily difficulty and controversial.

Economic Impact

Wine tourism is a big industry here in the U.S. The Wine Institute estimates that 20.7 million tourists visited California wine regions in 2010 and spent $2.1 billion.  An economic impact statement prepared in 2008 by Stonebridge Research for the Napa Valley Vintners association estimated that wine tourism accounted for more than 10,000 jobs in Napa Valley alone (about as many workers as in all the wineries and vineyards combined) with total payroll of more than $250 million.

The direct wine tourism impact on the county was estimated at more than $700 million for 2008. The economic impact is spread over hundreds of small businesses — wineries, of course, wine tour companies, hotels, restaurants, wine and food shops and so forth.

Although it doesn’t make the French magazine’s list, Napa Valley is the industry leader in many ways. Surely many wine tourism programs around the world have been inspired by Robert Mondavi’s example, which from the start aimed to create an experience, not just a wine tasting or buying opportunity. It’s all about story-telling. Wineries use tourism as an opportunity to tell their stories, which visitors weave into their lifestyle narrative.

The Accidental Wine Tourist

The 2006 Oxford Companion to Wine’s “wine tourism” entry suggests that Old World wine tourism development has been quite uneven. Wine tourists were long welcomed and accommodated in Germany’s Rhine and Mosel River Valleys, for example. But in France …

In France, wine tourism was often accidental. Northern Europeans heading for the sun for decades travelled straight through burgundy and the northern Rhône and could hardly fail to notice vineyards and the odd invitation ‘Dégustation–Vente’ (tasting–sale). (And it is true that a tasting almost invariably leads to a sale.) Wine producers in the Loire have long profited from their location in the midst of châteaux country, and within an easy Friday night’s drive of Paris.

Bordeaux was one of the last important French wine regions to realize its potential for wine tourism. The village of St-Emilion has had scores of wine shops and restaurants for decades but it was not until the late 1980s that the Médoc, the most famous cluster of wine properties in the world, had a hotel and more than one restaurant suitable for international visitors. Alexis Lichine was mocked for being virtually the only classed growth proprietor openly to welcome visitors.

Now, as this issue of La Revue indicates, the French are catching up!

There Must Be 50 Ways

So what is my bottom line? Wine is good, I tell my friends, but wine and a story is better. Wine tourism is about finding that story and making it first-person. There must be fifty ways to do this (La Revue gives us at least 35) and while visiting vineyards and wineries is the most obvious form of wine tourism I guess it isn’t the whole story.

Wine Wars on Planet Pinot

We are just back from the International Pinot Noir Celebration in McMinnville, Oregon — what a great event! I’ll be writing about some of the things I learned in the coming weeks, but I thought I’d use this opportunity to tell you what I said there.

This year the festival organized a “University of Pinot” for the participants with an All-Star roster of wine faculty. My course was Globalization 201: The Revenge of the Terroirists and I think it was one of the few classes that didn’t involve a wine tasting. (No wine? What was I thinking? Memo to self!)

I told the class about the forces of globalization and branded wine (the Curse of the Blue Nun and the Miracle of Two Buck Chuck) that I discuss in my book Wine Wars and then I expressed my faith that the Terroirist in all of us would preserve wine’s soul. (If you have attended one of my book talks, you will have some idea of what I had to say.) Then I turned my attention to Pinot Noir.

Pinot Noir is a great Wine Wars case study. It is one of the great global wine grapes. It ranks #7 on this list of the ten most planted red wine grape varities, for example, ahead of Bobal and right behind Carignan. You cannot find Pinot Noir everywhere, but in fact its domain is quite large. So all the good and bad things that happen to global wine necessarily happen to Pinot, too.

But Pinot is also incredibly local. In Benjamin Lewin’s excellent book In Search of Pinot Noir, he seeks out exceptional Pinot and finds it in only a handful of places. Pinot Noir is the third most planted wine grape variety in Germany, for example, but exceptional Pinot happens only in a few valleys up North. South Africa is too hot for Pinot for the most part, but there are a few tiny niches where cold winds from the ocean currents blow in to keep Pinot alive.

I was speaking in Oregon, of course, so all the students had to do is look up to the nearby hills to understand my point. Exceptional Pinot is a creature of tiny terroirist niches.

I frequently use videos in my class on The Idea of Wine at the University of Puget Sound, so I drew upon related images for my next points.

Because Pinot is such a particular thing, a certain idea of Pinot Exceptionalism exists. Pinot is different — not ubiquitous like Merlot and Cab, no subject to the same vulgaries as other wines.

Some of the exceptionalism comes from producers (like Burgundy’s Hubert de Montille seen here in a scene from the documenary Mondovino).  They see Pinot’s exceptionalism rising from the terroir itself, inspired by the finely delineated viticultural geography of Burgundy. I find that many Pinot producers feel the same way. I am no longer surprised when I see finely detailed maps of Burgundy vineyards displayed like small shrines on the walls of Pinot growers around the world.

Others see Pinot Exceptionalism in terms of the feelings and emotions that the wine inspires in those of us who drink it. I used my favorite scene from Sideways to illustrate this. This is the scene where Miles and Maya are sitting on the back porch and Maya asks Miles why he is so “into Pinot?”

Miles: I don’t know. It’s a hard grape to grow. As you know. It’s thin-skinned, temperamental, ripens early. It’s  not a survivor like Cabernet that can grow anywhere and thrive even when neglected. Pinot needs constant care and attention and in fact can only grow in specific little tucked-away corners of the world. And only the most patient and nurturing growers can do it really, can tap into Pinot’s most fragile, delicate qualities. Only when someone has taken the time to truly understand its potential can Pinot be coaxed into its fullest expression. And when that happens, its flavors are the most haunting and brilliant and subtle and thrilling and ancient on the planet.

Miles is really talking about himself of course — he simply projects his dreams and insecurities onto Pinot Noir.Exceptional Pinot is not all the same, it is individualistic, and this allows us to identify with it and through it as Miles does here.

The fact of Pinot Exceptionalism draws us to this wine, but we should never think that we are immune from the Wine Wars battles. Ironically, it was Sideways that triggered a global Pinot boom, with all the pluses and minuses.  The French Pinot scandal — thousands of liters of fake Pinot Noir were sold to U.S. buyers — indicates that Pinot People cannot take their exceptional status for granted. Note my favorite line: no American complained. Ouch!

I count on the terroirists to save the day, of course, but they face what economists call the Collective Action problem. How can you get them to work together? They are by definition individualists and they can be pretty opinionated, as this exchange from a video by Jancis Robinson illustrates.

Jancis was visited Domaine Leroy in Burgundy, tasting with Lalou Bize-Leroy herself down in the cellar. After marveling at Lalou’s wonderful wine, she pulled out a bottle of Oregon Pinot and offered up a glass.

Lalou sniffed, sipped and spat! It is OK wine, she said, technically sound. But it has no soul. Oregon mustn’t make Pinot, she said. They should make something else that is more suitable to their terroir. [And leave Pinot to our terrrior here in Burgundy, I suppose).

An understandable attitude, but hardly a way to organize a critical terroirist mass. Later in the same video one of the Oregon Pinot Pioneers makes a similar assessment about Pinot in California. Ouch! Rather than presenting a unified front, terroirists sometimes seem to be their own (and each other’s) worst enemies.

Benjamin Lewin notes a different terroirist trouble in his book. Many American Pinot makers are so obsessed with expressing micro-terroir that they undermine their region’s reputation. They make many tiny production micro-terroir wines that are so scarce that they almost do not exist  because basically no one can taste them.  These invisible wines may be grand cru quality, but who but a lucky few insiders will ever know? Meanwhile the more widely available wines are only village quality at best in terms the Burgundian reference, according to Lewin.

Maybe Lalou’s reaction to Jancis’s Oregon Pinot can be understood in this context. If this wine (which tastes like a village wine) is the best Oregon can do, perhaps they should try something else.

So this is why IPNC is so important. Not [just] because it is so much fun or because it is such a sensuous delight. And not just because of all the great people who make it happen.

IPNC’s magic s that it brings terroirists together in the spirit of shared pleasure and mission. If the terroirists’ revenge is to happen, it will be because of the common purpose and spirit that gatherings like IPNC foster.

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Thanks to the folks at IPNC for inviting us to participate in the University of Pinot.  Thanks to our friends Susan and Scott Chambers for letting us beta-test their Davis Street Bungalow in McMinneville — perfect location for IPNC or Oregon wine tourism.

Wine Reviews: A Modest Proposal

Decanter, the self proclaimed “world’s best wine magazine,” is “relaunching” its Buying Guide section in an attempt to make wine ratings more transparent and therefore  useful to its global audience. You can read all about the new tasting panel protocols here.

Three Heads Better Than One

Instead of listing a single rating score for each wine, for example, Decanter will now provide the individual scores of three critics. I wasn’t sure if this would make much of a difference, but having read through the new issue, I am a fan. Let me take the big review of Rias Baixas Albarino as an example.

Having read the press release, I was expecting to see four numerical scores for each wine (one for each of the reviews plus the average). What I found was a good deal more, however. Each of the three tasters (regional experts Ferran Centelles, John Radford and Jane Evans in this case) also provided individual  tasting notes for the eight top wines plus summary assessments of the group of wines. (The wines were apparently spectacularly good — 8 top scores out of 74 wines and 25 designated as good value.)

Each of the tasters also provided notes for their “top three” recommended wines and John Radford wrote a brief essay to sum things up. Result: There is a lot of information here and a sense of a wine conversation rather than a monolithic judgment. Great new format.

Global Wine Drinkers Want to Know

For as long as I have been reading Decanter the wine ratings have had three components: a brief but useful tasting note, a numerical rating on a 20 point scale and finally an overall assessment of zero to five stars. Of these three the tasting notes are the most useful for serious study while the star system works well for me as a potential buyer. I’m not sure I can taste the difference between 15.5 and 16.0, but knowing what’s Good, Better and Best (my casual interpretation of three, four and five stars) is something I can use.

But Decanter’s scoring system has changed. Here’s a quote from the press release.

Perhaps the most significant new feature is the adoption of the 100-point score, to run alongside Decanter’s 20-point score, while the old five-star system has been dropped.

Introducing the 100-point system is essential as Decanter is now a global magazine with more than half its readership outside the UK,  [editor Guy Woodward] says in this month’s editorial. Readers can now ‘use whichever [scoring system] they are more familiar with’.

Fair enough — although “essential” is pretty strong —  but I’m going to miss the simplicity of the old five star system and I’m not really sure that I need to have the 20 point British scale translated into a 100 point American equivalent. Converting Decanter scores into Wine Spectator-type figures and back again isn’t exactly rocket science (see the conversation table below). But I don’t see any harm in it, especially if, as the Decanter story suggests, the point is to help “global” readers who may be unfamiliar with the 20 point system to make sense of the ratings.

Follow the Money: A Modest Proposal

It’s good to step back and rethink things like this every so often, but maybe Decanter’s relaunch didn’t go far enough, so in the spirit of Jonathan Swift, I’d like to offer a “Modest Proposal” for future reform.

Here’s my idea. Instead of asking critics to score the wines on a quality scale, let’s ask them how much they are worth! How much should someone be willing to pay for this wine?

Wine reviews generally tell us a wine’s price and a score, but what we really want to know is if it’s worth it. That’s the question that a lot of shoppers want answered and the question they are often trying to figure out when they read critic reviews. From a practical standpoint, don’t you think it would be more useful to translate scores into bucks rather than messing around with 20 points versus 100?

Yes, yes, I know there are lots of problems. A wine that tastes good enough to sell for $20 to you might only taste like it’s worth $12 to me. But that’s nothing new — differences in taste and the problem of what economists might call “interpersonal utility comparisons” are part and parcel of all wine rating systems.

The Mitt Problem … Solved

Income distribution is a more difficult question, however. Mitt Romney has mega-bucks, so me might be willing to pay a lot more for a given bottle of wine than I would. That would mess up the ratings if he were a wine critic. But, hey, Mitt doesn’t drink wine, so … problem solved!

There would be lots of benefits to this new system. Easy to use — just compare the price score ($15) with the market price and you know if the wine is “worth it” or not.  Under a set of ridiculously improbable theoretical assumptions that I won’t explain here because it would put you to sleep, the gap between price and critic-assigned value would be equivalent to the welfare economics concept of “consumer surplus” and so the scores would allow consumers to more efficiently maximize utility and achieve a Pareto Optimal resource allocation.

And while this doesn’t really work in theory, it is how many people behave in practice. How many times have you heard someone brag that their $10 wine tastes like it should cost $20? And although this is a silly thing to say, I believe many people really enjoy the benefit they think they have gained from that value-price gap. So the new system wouldn’t change that way of thinking — just improve it. We’d be drawing upon expert opinion for judgment rather than our own amateur assessments.

A Crazy Idea

Yes, I know this is crazy, but that’s the point. Jonathan Swift’s original 1729 modest proposal — that the rich  should eat the children of starving Irish peasants  — was also crazy, but the point was very sane. The cost of food (due to the high rents that landlords collected, according to the author) was already killing children in Swift’s day. As he said, the landlords had already “eaten” the parents through outrageous prices — might just as well go after the children next.

My wine rating reform is crazy, too. You can’t use money to rate wine. Wine doesn’t taste like dollars — it tastes like wine! But, that’s my point. It doesn’t taste like dollars, but it doesn’t taste much like points, either, however useful consumers and producers might find the ratings to be. Hey, don’t get upset. It’s just a modest proposal!

Here’s the Decanter conversation table. Cheers.

Wine Wars in South Africa: Nederburg Auction Keynote

I’m pleased to announce that I’ll be giving the keynote address at this year’s Nederburg Auction in Paarl, South Africa. I was already planning to attend Cape Wine 2012 as a guest of Wines of South Africa, so I was delighted to receive an invitation from the Nederburg Auction organizers to extend my visit by a day or two in order to address their international audience.

About the Nederberg Auction

A premier event on Cape Town’s wine calendar, the Nederburg Auction serves to showcase the spectrum of award-winning wines and rare Cape finds created by the country’s most talented winemakers. Since its beginnings in 1975 with the ‘famous five’ founding participants; Delheim, Groot Constantia, Overgaauw, Simonsig and of course Nederburg, and an offering of just 15 wines, the Auction has evolved into an international event where major local and overseas wine buyers bid for a stringently selected range of the finest wines created by South Africa’s most talented winemakers.This year marks the 38th year of this prestigious event.


Here’s a video about the 2011 Nederburg Auction.

The Press Release

Guests at this year’s prestigious Nederburg Auction won’t want to miss the keynote address by best-selling US author and wine expert Mike Veseth on Saturday 29 September at Nederburg in Paarl.

With the state of the global economy crisis posing many challenges to the wine world and the South African wine industry in particular, this acclaimed US economics professor and “wine economist” will bring his considerable expertise to the speaker platform, tailoring his keynote address around the subject of how South Africa can win the Wine Wars. This aptly follows the fresh insight presented by last year’s speaker, David White, into the changing wine landscape and the future implications for the industry and consumers.

He will discuss the market trends that are redrawing the world wine map and the terroirists (those focused on a wine’s terroir or place of origin) who resist them. Veseth believes that wine businesses are at a critical crossroads, shaped by the powerful forces of globalisation, corporate branding and the exploration of new markets.

As a professor in international political economy at the University of Puget Sound in Tacoma, Washington, Veseth is regarded as an authority on the political economy of globalisation and the global wine market, applying his sharp and astute mind to analyse and understand the complex dynamics of the international wine world.

Nederburg Auction Business Manager Dalene Steyn says: “While believing in preserving the essence and the soul of wine, Mike is also well-versed on breaking into new markets in China, Australia, France and the US. With this combination of a love for wine along with extensive business and economic acumen, we believe he will inspire and motivate wine lovers in South Africa – just like he has done elsewhere in the world.”

The editor of The Wine Economist blog and author of more than a dozen books has won critical praise for his recent book“Wine Wars: The Curse of the Blue Nun, the Miracle of Two Buck Chuck and the Revenge of the Terroirists (2011)”, which draws remarkable conclusions on the market forces that drive the wine industry. The book has won several awards and prizes, including being selected as Best American Wine History Book 2011 by Gourmand International and a Wine Book of the Year by JancisRobinson.com.

Mike Veseth will address guests of the Nederburg Auction at 09:00 on Saturday 29 September in the Graue Hall, prior to the start of the day’s bidding session. For further information visit http://www.nederburgauction.co.za. The Nederburg Auction is sponsored by Nederburg.

I’m honored to be asked to give this keynote address and pleased to be associated with such a prestigious event.