This is one of those posts.

I started writing this post on August 2, 2007 after 6 months inside what I began to call, “The Cult of Gary.” Of course, I was a lurker only commenting on the odd episode and not really participating with the discussion Gary Vaynerchuk has led for the past two years at Wine Library TV. And I think I nearly missed the point of why Gary connects with so many people; it’s his humanity.

But the first draft of this post did not mention humanity but focused on the ethics of using a scoring system in his reviews, lack of disclosure on the podcast of being a wine retailer and his unorthodox approach to palate training (I still would like to know what Bob Parker, Jim Laube or Steve Tanzer thought of Gary’s schtick on Conan O’Brien and Ellen). It also bothered me that Gary was so opaque to the wine blogger community who socialize on Twitter and often email each other on various subjects. Each time I hovered over the “Publish” button, something held me back from sharing my insights on the most celebrated wine podcaster in the world. Sometimes it would be to soften the language so it wouldn’t sound like sour grapes, other times it would be something Gary did that provoked more investigation.

So months past and the post stayed in my drafts folder waiting for more context in order to complete it. I found that context last week with this short video Gary published on his personal blog:

I have come to the conclusion that Gary is one of the most influential people in wine today not because he’s got the best palate — although he’s got mad skills there — but in the way he’s almost single handily changing wine marketing. He’s often quoted saying that the wine business is “broken” and he’s trying to fix it. I agree and applaud his efforts in demystifying wine and making it fun for those outside the wine blogosphere. Watching Robert Scoble’s video from last weekend shows this first hand:

My earlier concerns diminished as I realized that those of us in the wine blogosphere are not Gary’s audience. As the hardest working man in wine podcasting, he’s delivering the goods to tens of thousands who would be bored stiff reading about wine. Yes, I’d like to see some disclosure but this seems like a quibble when looking at the amount of good Gary is doing for wine podcasting and blogging.

So I think everyone interested in wine should watch Wine Library TV at least once a week. Because the kid has heart. And skills.

On one hand, I agree with Jason that terroir is too often the de-facto marketing strategy for too many wineries. On the other, I’ve tasted different blocks of the same vineyard and found each wine quite different. So there’s something to this notion of terroir.

But the real learning from this podcast is that those of us who write about wine are too often obscuring the true enjoyment of the beverage with jargon and a learning curve that most people will not invest the time to learn. Perhaps that’s really at the center of the argument that most wine blogs are boring.

So I’m going to make an effort to change the way I talk about wine here and on my podcast to make the content easier to understand for the non wine geek.

I’m also hoping to tell the real story of what happened at Stormhoek in coming days.

Yea, I know, there is some pretty decent juice poured in business and first class, but I’m talking about the bottles served for $5 in coach. In my recent experience none of the wines on offer are worth the money and I tend to drink ice water on flights as a result.

It would seem to me that this is an interesting marketing opportunity for wine brands of a certain scale or brands known for consistent quality and value. Since bottling for airlines requires a special line out of reach for most small to medium wineries, only larger production brands tend to play here. Some are obviously using this as a way to expose their brand to new customers as about half the time the wines presented to me are from unfamiliar wineries (mostly from the southern hemisphere for some reason).

But what if someone like Cameron Hughes bottled some larger lots or a special blend just for airlines? They could change the wines over time to expose customers to something better than the average fighting varietal now most common. On the back label they could tell their direct marketing story.

I’d definitely fork over $5 for this kind of juice any day.

How much of this difference is due to the decisions of winemakers in the cellar and how much is due to the vineyard practices and place they are grown?

Terroir has long been part of the mythology of wine marketing. But is there really a difference between Cabernet grown at Martha’s Vineyard and the vineyards in American Canyon? Would we be able to taste the difference if both vineyards were made into wine by Heidi Barrett?

From my experience I’d say yes, but it would be interesting to see what some of the best winemakers would make from more humbly grown grapes. Alas, I don’t ever think we will see this in reality but it’s interesting to see what folks like August Briggs are doing at Castle Rock and his eponymous winery.

In the end, place matters but how much is open for debate. As with all luxury goods, scarcity and reputation drives wine prices but quality can be another story altogether.

It’s been a while since I posted here at Good Grape so I thought I would get back into action with a meaty topic I think a lot about in my day job as a wine marketer.

How has wine marketing changed in the era of consumer generated content?

At one end of the spectrum is the ground-breaking work by Hugh MacLeod harnessing the power of social media to reposition Stormhoek as a “social object.” You can check out Hugh’s account of his campaign by viewing a 25 minute video of a talk recorded at the PSFK Conference in London last month.

What is most interesting about Hugh’s story is how simply — and almost by accident — he implemented a global marketing campaign in a very fragmented and traditional industry. Like a lot of wine brands, Stormhoek is a volume play where critic’s scores, aggressive sales practices and shelf-talkers are the standard marketing approach. So what did Hugh and Company do? They engaged the blogosphere and started a global conversation about their brand. The result was more than doubling sales in less than 2 years for an investment of about £20,000 (approx. $41,000 USD).

The other end of the spectrum is where 99% of the wine industry is at the moment with their heads in the sand about the internet and little clue about social media. They live in fear someone uneducated consumer will bad mouth their wine on one of the new Wine 2.0 sites such as Cork’d. This level of spin control and anxiety is understandable given the subjective subject of wine tasting where a $2 Chardonnay could be judged superior to a $40 Chardonnay.

But I have three words of advice for winery owners - Join the conversation!

We have seen a few brave wineries start blogging and engage the growing wine blogosphere. Although the jury is still out on their efforts, I know wine has been sold and word of mouth has resulted in new customers.

Don’t have a tasting room? Use your blog to create a “virtual porch.”

Have a limited marketing budget? Spend some time reading and responding to wine bloggers and they will say some good things about your wine and drive traffic to your blog.

The theme of this week’s Wine Industry Technology Symposium underscores the urgency of wineries adopting new online marketing strategies. My favorite quote was from wine podcast superstar Gary Vaynerchuk from Winelibrary.com who said in his talk to , “Embrace your website as your business.” Amen, brother; I hope a few wineries there got the message.

So the bottom line is that wineries who are not part of the social media conversation are doomed to let consumers determine their word of mouth. Like any online endeavor there are trolls but if you engage and extend the conversation you are more likely to encourage partisan customers to come to your aid. If you do nothing, you are likely to suffer in “Google Hell” for some time.

All it takes is a bit of time and focus. The rest — like what Stormhoek has done — could be history.

On one hand this seems so 20th Century in the age of iPods but even I will switch from “AUX” to the radio when coming into an unfamiliar area to pickup local news and information. If a spot for a winery came on during those times I would certainly take notice and probably stop by the winery if I had a few extra minutes. And there is additional utility for the ad if the marketer posts an mp3 version on his blog that will gain much more exposure there than on the radio.

The bottom line for me is anything that continues the conversation about your winery is money well spent. Nice one, El Jefe!

Push play to listen: mp3

I’ve been doing some work recently that got me thinking about how much a wine’s price is determined by the actual quality of the wine in the bottle and how much by the demand created through marketing. Aside from a few very rare exceptions, wine needs to be marketed to be sold. This is normally done through retail stores, the winery tasting room, to wine clubs and increasingly through online wine merchants. All these add to the costs a winery has to pay in order to get their wines to the customer but they are not the main cost driver; the grapes are.

If you are Fred Franzia making his famous “Two-buck Chuck” you are paying about $100 a ton for your over-cropped Central Valley Cabernet Sauvignon. The yield per ton is probably something like 7 tons per acre which doesn’t produce the most concentrated fruit. That ton of fruit will make around 60 cases or 720 standard bottles so Fred’s got around 14 cents per bottle in fruit costs. Now you can start to see how he can make money selling it for $1.99 at Trader Joe’s. Contrast that with the premium producer in Napa Valley who spends $6,000 a ton on fruit and up. There the yield is between 3 and 4 tons per acre that will produce a more concentrated, complex wine. Assuming the same 60 cases are made, the Napa Valley producer has around $8.30 in fruit costs. Not too bad if the wine will be selling for $50 or $60 a bottle but still 60 times more costly than Mr.Franzia’s wine. But this post is not intended to be a forensic dissection of the wine cost structure, for that, visit my friend Vini.

So getting back to the wine in the bottle, the basic difference is in the quality of the fruit and cellar treatment (i.e. new oak barrels vs. chips, aging time, etc.). For producers making the finest wines they tend to spend a lot more on these items but in the final analysis the most extravagant producer might have something like $30 of cost in each bottle produced. Since distributors buy at an average of 40% off retail, this wine would sell for a minimum of $57 a bottle assuming a 10% winery profit. But what if this wine is priced at $150 or $500 a bottle? Well, the profit margin is certainly higher but there are probably higher marketing costs, as well.

As I learned last week, there seems to be a point where price and quality diverge. The reputation of a winery, bolstered by glossy treatment in the wine magazines and 95+ Parker scores also help to push the demand, and price, for these wines. But are they the best example of a certain wine region or variety? Well that, my friends, is in the eye, and palate, of the beholder. You might think Screaming Eagle is the zenith of Napa Cabernet while I prefer what Ladera is doing for a lot less. Preferences aside, there are many great quality wines from all over the world that compete for our hard earned wine dollar. What really separates them is not the quality of what’s in the bottle but the demand that is created for those bottles. That, in a nutshell, is the essence of marketing… at least in my book.

As a wine marketer, I’m always on the lookout for new and innovative strategies to sell more wine. As the first wine podcaster, I feel a certain responsibility to keep current on the genre by subscribing to every new wine podcast (for a while anyway). When these two things meet, I take notice.

So it was with great interest that I discovered today that Trinchero Family Estates has started to podcast. This is the conglomerate that white Zinfandel has built with the best known brand being Sutter Home. Their podcasts are focused not on consumers like first entrant Goosecross Cellars (disclosure: I work with Goosecross) but on the trade. Kudos to whomever at Trinchero came up with this idea as I’ve always thought that business-to-business podcasting is as compelling as business-to-consumer. It’s somewhat perplexing why this is not the first thing large wineries would think about in this medium as distributors, retailers and restaurants are naturals for regular communication in forms that can be consumed on the go. But that’s where this effort falls a bit short in my opinion. Instead of providing RSS feeds for listeners to subscribe to, they make the user download each podcast individually. This can be easily fixed and I’ll bet someone will take care of this shortly. My impressions of the first few shows I listened to are, well, sort of dry and basic but it’s a start.

I’m hoping other large wineries (and I’m talking to you, Gallo!) will follow Trinchero’s lead here and address their podcasts to the trade and maybe even the consumer, too. It’s inexpensive and very effective.

Basically, Twisted Oak is asking it’s customers to write the back label of the soon to be released white Rhone-style blend called %@#$! Customers have plenty of ideas to inspire their writing from past examples on the Twisted Oak blog. All entries must be received by March 16th and the winner will be announced March 19th and their back label will be printed on the back of the next release of %@#$! later this summer. Everyone entering the contest will receive a 20% off coupon for wine purchases and the winner will receive a full case of %@#$! with their custom label.

Like other promotions that invite customers to co-create the product, I think this one will be successful in spreading the word about Twisted Oak and get more people to try their wines. Current customers will tell their friends and this word-of-mouth will spread virally. All without expensive ads in Wine Spectator and the like. Very Wine 2.0, El Jefe.

So it’s rare that I see an approach that is simple, cost effective and innovative that will result in increased customer loyalty and differentiation for a wine brand. Sure we have the breakout plays, such as Stormhoek, but those are an anomaly that would be ground breaking marketing any product. An example of something a bit more conventional is provided by Napa Valley’s Fantesca Estate & Winery with their “Fortune Corkies.” Puns aside, this is a brillent idea that I’m sure other wineries will be tempted to emulate. Basically, the winery prints wine quotes on their corks and is encouraging their customers to submit a quote of their own which will be printed on their 2005 Cabernet cork when it is bottled. Do you think the winner will buy some of that Cab with their personal quote on it? Absolutely, and they will tell all their friends about it who will pass it along because it is so out of the ordinary. Another aspect I like about this campaign is they have 9 other wine quotes from famous people that encourages larger orders so customers can collect all 10 corks.

Hats off to Fantesca for a great idea to build brand loyalty and to Ryan from Calwineries for tipping me off to this one.

This campaign is simple, inexpensive and very effective to build their brand and make a human connection even on this side of the Atlantic. Stormhoek continues to set the bar for online wine marketing by not only using, but embracing, social media.

Check it out:

So why do wineries not value their websites or see them as strategic to their direct to consumer marketing? I think it’s due to a few factors. First, many wineries do not have a marketing person with much online experience. Other than hiring an agency or consultant to put up a brochure site, a lot of wineries don’t see the value of their websites. Another reason is that most small wineries don’t have any marketing people. There also seems to be a view that marketing is something “nice to do” after getting a sales plan in place. This makes sense since generating cash is a winery’s first priority and there are a number of other activities more important than marketing, let alone an optimized website.

So does this mean winery websites are not important? Hardly, as there are compelling examples of wine brands using their websites (or blogs) to dramatically increase sales in a short period of time. It’s just that those wineries are very far ahead of the curve right now. As more wineries seriously map out their consumer direct strategies, they will spend more time crafting their web presence to meet the needs of customers. Until then, their websites are, frankly, not that important to them. Which is most disappointing to those of us marketing wine online.

I’ll bet Mike has plenty of business later this year and into 2008 as more wineries understand the importance of their websites… as they say, the pioneers are the ones with the arrows in their backs.

Editor’s Note: This is the first of at least 52 posts for the Good Grape blog over the next year.

While tasting at yesterday’s Zinfandel Advocates & Producers (ZAP) Festival, I came across an interesting new brand that is targeting their wine squarely at the Millennial Generation. Muse Winery has launched this wine as “Mingle” and not the more expected “Zinfandel” because the Millennial buyer is looking for different wine taste experiences and is more tolerant of unconventional blends than their Baby Boom parents. Mingle delivers on the different blend front with Zinfandel being joined by Syrah and Cabernet Sauvignon instead of the more common Petite Sirah and Carignan. The result is quite nice with forward black cherry fruit, a touch of black pepper and smooth tannins. I rated it a very good 86 on the 100-point scale. It’s not just the wine, but also the packaging, that will appeal with this demographic as Muse has created a colorful label, unconventional bottle shape and “Peel, Pop and Pour” cork closure last seen on inexpensive sherry and port.

For readers not familiar with the Millennial Generation, I’ll back up and give you some background. Born between 1979 and 2002, Millennials follow GenX and The Baby Boom in the generations since WWII. Now coming of drinking age in large numbers — they are 100 million strong in total — this generation is the first to get into wine in a big way since their parents Baby Boom cohort. Unlike their parents, they are not looking for status wines or cellaring, preferring instant gratification. Wine should be unpretentious and just good to drink with Millennials who also look for food friendly wines. They are also squarely in the value category from a price perspective with the sweet spot being between $10 and $15 USD a bottle.

From a marketing perspective, Millennials present several opportunities for wineries. Since they are really just looking for a pleasant beverage for enjoying with food, scores and awards are not important. This means no brand building in the pages of Wine Spectator, Decanter or Wine Enthusiast magazines. Millennials are also the most wired generation, never knowing a time without the internet. This presents the wine marketer with the opportunity to market online and add social media to the mix. I’m currently working with a consulting client on launching a brand to this generation and a My Space presence and podcast are key elements of our marketing plan. We are also spending time on simple, colorful and attractive labels, unique bottles and Stelvin twist-off closures.

So it’s not business as usual selling wine to Millennials but it is pushing the state of the art for wine marketing forward. Anything that compels wineries to embrace blogs, podcasts and online communities is alright with me.

Proprietor Josh Hermsmeyer has open sourced nearly everything since he started Pinotblogger in late 2005. Along the way he’s involved the community in naming the winery, label design and, most recently, his tasting room. I think this is the future of wine marketing and look forward to visiting the winery sometime next year after it is built.

This is historic stuff folks and I recommend you not only check it out but to subscribe and read each post. Great work, Josh.

Imagine my surprise this morning when I read that he was cutting off the list today and would post only one more photo. So I hastily set-up this shot in my typical blogging environment. Hope it makes it just under the wire

I promise to post a more interesting location with the T a bit later on; perhaps while tasting at ZAP (bet I’d get some looks

The wine is a California bottling with a private label due to a logistical problem of not being able to find an Italian producer (what’s with that?). I’ll give the benefit of the doubt to the agency but it’s clear that a wine lover was not involved thinking this promotion through. For example, if I was consulted on this, I would have immediately contacted some California wineries that produce Italian varieties such as Sangiovese that would have tied into the show closer. The whole “indulgence” angle also bothers me for a couple reasons. First, in the context of a TV series centered on ancient Rome, it implies over indulgence. I also think this is a bit of a dated view of wine as a luxury item and not a part of a lifestyle that ancient, and current, Romans enjoy.

I do think this will create some additional exposure for the show but I don’t think it will create the kind of buzz that other wine promotions have in the recent past. It will certainly be a nice surprise for some diners and, if the wine is good, help the brand but the sample size will be too small for any meaningful impact.

Since I don’t live in any of the cities where this campaign will run, I will not be able to report on the wine. If you happen to be in one of the restaurants and take advantage of the promo, post your notes here. It will be interesting to see if any big city wine bloggers or writers cover this story…

Update 1/10: Dr. Vino has posted about this story; since you live in NYC, why not try the wine, Tyler? On second thought, you are probably right that it’s not worth the effort

So why shouldn’t wine be on this list, as well? With sites like WineQ, Bottlenotes and Openmarket Wine now on the scene and more launching early next year, I expect to see something like this next holiday season. It would make a great stocking stuffer for the wine geek on your list.

Today, I can’t imagine an actor like Anthony Hopkins plugging Mondavi or Gallo wines on TV. How far we have come in the marketing of wine…

Looking at these spots takes me back to my wine roots, drinking a bit of Paul Masson Burgundy and Emerald Dry. Most days, however, I drank Gallo Hearty Burgundy or Chablis Blanc from huge 3 liter jugs. Haven’t had those wines in years; I wonder if they are still as tasty as I remember them? Perhaps a trip down the jug aisle is in order.

What were your “roots wines”?

I have to say that the BBC presenter seemed more intent on exposing the offer in question as not what it seemed to be rather than focusing on the key story. In a nutshell, Stormhoek blogged about a “friends and family” coupon at one of their UK retailers and the uptake via word of mouth was quite a bit higher than anyone would have expected. It’s actually enough of a story that it has crossed over into the mainstream media now. This not only shows the power of blogging but also the a key tenant of Wine 2.0 marketing strategy: viral, word of mouth marketing can be quite powerful if done right. In this case, it was a compelling offer (40% discount) that was an exclusive (blurring the lines of who “friends” really are) and disseminated via an A-list blogger in the form of a PDF voucher. The network effect took over from there and now there’s tens of thousands of customers ready to use these coupons.

It’s not surprising the mainstream media missed the point here. They seem more interested in chasing controversy than reporting an interesting business story, but I digress.

I’m hoping this kind of offer spreads the wine retailers in the US. Anyone listening from Surdyk’s, Haskell’s or Solo Vino?

My favorite part of the piece in AdAge is Hugh’s quote:

“There’s more to blog marketing than sales, he says. Blogs help marketers see consumers as people, not just abstract, dehumanized targets…”

All this proves that social media is a powerful force in marketing and it can be applied successfully in the wine industry. I’ll be tracking a few other wineries using similar tactics in future posts here.

Congrats Hugh and Jason!

If you’ve never heard of Gia, she is a blogger and British television presenter best known for her work on technology focused shows. But what does she know about wine, you might be wondering? From her first post on the Stormhoek blog it would appear not much more than the majority of wine consumers. This is what I think this is brilliant from a marketing perspective, because the winery will develop closer relationships with customers who will identify with some of Gia’s questions and be subtly educated along the way to prefer the Stormhoek brand. I think we are witnessing the future of wine marketing here.

In her inaugural post, Gia asks five questions that seem common to non wine-geek types like me and most other wine bloggers. I thought it would be fun to respond to each of them here:

1. What is a good wine to take to a dinner party when you don’t know what’s being served?

This is a common issue for all of us no matter how deep our wine knowledge. I usually bring two bottles to dinner parties, a white and a red. Both should be food friendly such as Sauvignon Blanc and Pinot Noir. In the Stormhoek range, I’d pick the fine Pinotage for the red here. Should I bring just one bottle it would be either a rose or sparkling wine such as Champagne. Both of these pair with a wide variety of food.

2. If you don’t know the names of wines or vineyards, how do you choose what to drink at a restaurant?

Great question that is probably the biggest source of stress for most people. Assuming you are in a restaurant that has good wine service, I’d ask the sommelier for a suggestion. Be clear on how much money you want to spend and what types of wine you enjoy. He or she will ask what kinds of food will be ordered to narrow down the selection(s). If you are in a restaurant without a sommelier, I would look for brands I have enjoyed in the past first, then varietals I like second.

3. What if you don’t finish the whole bottle? Can you keep it until the next day without it turning into vinegar?

If local laws allow, restaurants will re-cork your unfinished bottle for you to take home. The wine should be fine for a day or two particularly if you store it in your refrigerator (including reds, but allow them to warm up before drinking). I use Vac-u-vin as a way to preserve open bottles up to a week after opening.

4. How do you get red wine stains out of carpet/clothing?

Two words: Wine Away.

5. Does that funny sucking/slurping way of tasting wine actually improve the flavour or do you just like looking silly?

While this technique may look silly, it actually provides better aeration of the wine in your mouth and exposes the wine to more flavor receptors on your tongue. All of this improves the flavor of the wine and helps us to write more detailed tasting notes. Unless I’m at a tasting with other wine geeks, I try to be subtle about this to avoid the arched eyebrow from my wife

Great questions, Gia. Rock on…

As I mentioned here earlier I had high hopes for Wine Life Today, but this site seems to be at the very same place it was when I reviewed it; not enough visitors to submit and/or rate stories to make this as indispensable as digg.com is for technology news. I’ve tried Cork’d and just looked at Bottlenotes but don’t see either of them to be compelling until they have a way for me to easily tag posts here that automatically populate my accounts on their sites (preferably in the form of a Wordpress plugin). Even the newly rebooted Netscape site has not attracted critical mass to get more than a handful of votes for food and wine related news. So is wine too niche for Web 2.0?

Perhaps, but I also think it’s probably too early to know how any of this will turn out. Yes, the wine industry is very traditional with the bulk of wineries just now grappling with integrating the internet into their traditional sales and marketing approach. But there are glimmers of hope out there that perhaps the future is closer than I think.

Case in point is an invitation to a web 2.0 event in San Francisco in a few weeks cleverly called, “Wine 2.0“. A collection of wineries, technology companies, venture capitalists, and, yes, wine bloggers will meet. Even though it’s 2,000 miles away from my home and will cost me out of my pocket to attend, I’m seriously considering going to be on the ground floor in this space.

Another data point is a new wine blog aggregator now in preview called Vinolin. They take the simple aggregation of wine blogs one step further by adding a tagging component. None of this is enough to get super excited about right now but in a few months there will be a central repository of knowledge about wine that will be very compelling; in a year or two this could compete favorably with some of the traditional wine press. Think of it as the Technorati of wine blogs. So, of all the sites I’ve seen, this one will become a part of my daily routine.

Perhaps wine isn’t too niche for web 2.0 after-all. What do you think?

Speaking of my day job, my work with Goosecross Cellars has turned to more of a part time gig so I’m looking around for some more work. If you know (or are) a winery who wants to sell more wine direct to consumer using the internet, drop me a line. I’m also looking for another tech marketing job in Minneapolis, but hoping I might be able to string together enough wine gigs to make ends meet. I’ll keep you posted either way…

“The French wine industry has woken up to the challenge but only after some time, Dartigues explains, adding that even now, some Bordeaux wine producers she visits do not know what an MBA is.”

The French have a lot better things to do than understanding what an MBA is; they, like a lot of producers worldwide, need to better understand their customers and make wines they like. That’s it; no MBA required, but I will produce some pretty nice looking charts and reports for you