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My Wine Predictions for 2010

by Tim on 1/2/2010

Despite my fairly checkered past in making predictions for the coming year, I am back with another batch. I think 2010 will be a transformative year for the wine business and for wine blogging. The economy will show improvement by the summer which will reverse the “nuclear winter” we have seen for the sales of high-end wines over the past 18 months. But there will also be some surprises in 2010:

The Return of the Luxury Wine Segment – It’s been a tough year for wines above $35 a bottle. In fact, Mike Grgich recently commented he had never seen a more challenging year in his 50 in Napa Valley. But that will change as the economy gains strength and American consumers vote with their wallets. There will continue to be a trend toward value but those $60-80 Cabs will start to sell again.

Wineries Integrate Social Media Marketing – As I mentioned in my review of 2009 yesterday, social media was one of the big trends last year with wineries tweeting and connecting with customers on Facebook. This will be the norm by the end of 2010 with social marketing fully integrated into the go-to-market plans of wineries of all sizes. No longer will it be, “nice to do,” or something to get an edge on competitors. Social marketing will be a requirement for growth by the end of this year.

Wineries Will Go Mobile – This is the next frontier as mobile, local and social all converge on smartphones such as the iPhone. Apple’s forthcoming tablet will also change the way consumers use the web to learn about wine and also buy it. Early adopter wineries are already working on their mobile strategies; by year-end nearly everyone will be playing catch-up as this space heats up.

Wine Bloggers Will Discover Business Models – We have seen the rise of the “professional” wine blogger in the past couple of years and I expect more of us will discover how to turn our hobbies into cash. No, it will not be a full-time living for most, but it will be a significant enough incentive to create content on a regular basis. Some will cry foul as monetization can lead to conflicts of interest but there will be several bloggers who will figure this out.

A Major Wine Print Publications Will Fold – OK, so this is my outrageous prediction for the year. And I don’t think this casualty will be the Wine Spectator, Wine Enthusiast or newsletters like the Wine Advocate. But the times are changing and I don’t see a great future for print wine magazines particularly after new technologies that fundamentally redefine what a magazine is hit the market early this year (e.g. Apple iSlate or whatever this will be called). I hope to see some true innovation in online wine coverage, too.

So that’s all I’ve got this year. Let me know what you think in the comments. I wish everyone a very happy and prosperous 2010 (and that’s, “twenty-ten”).

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My Wine Predictions for 2009

by Tim on 1/1/2009

Photo by Charyn Pfeuffer

Photo by Charyn Pfeuffer

A couple years ago I made 8 bold predictions for 2007. I decided to sit last year out after only the most obvious of the eight actually came to pass (increasing direct to consumer wine sales). But some progress was made on the list in 2008 with Tyler Colman, a.k.a Dr. Vino truly “going pro” with the publication of not one, but 2 wine books. Not to mention the entire Gary Vaynerchuk story which played out in a big way since I made that prediction. Some of my other predictions also made some progress toward fulfillment so I’m going to add six more for 2009 today.

The Year of Value – This prediction is really not that much of a stretch since the world economic downturn has made it a lot more challenging for wine producers to sell higher priced wines. Anything above $25 a bottle will be a tough sell in this environment with a lot of competition for consumers in the $10-15 price category. Look for some producers to just lower their pricing while others, such as Cameron Hughes, Mark West and Castle Rock, will be perfectly positioned to gain market share. 2009 is the year of extreme value that might also spark more interest in wine auctions as consumers look to maximize their purchasing power.

Wineries Really Go Direct – More wineries are exploiting direct to consumer sales and I expect to see a lot more growth in this area particularly for higher priced brands. The economics of direct sales and shipping will be a major advantage for wineries who can create enough pull with consumers. With wine tourism down due to the recession, I see the winners being those who create this pull online via ecommerce and, increasingly, a social media presence.

Yellow + Blue MalbecAlternative Packaging – As wine lovers become more concerned about the carbon footprint of their favorite beverage, more will look for wine packaged in bag-in-box or TetraPaks. As I’ve blogged here in the past, I hope to see better quality wines in these packages particularly those wines intended for immediate consumption.

Wine 2.0 Will Produce A Star – I’ve written about the intersection of Web 2.0 and wine for some time now but there has not been a breakout success story yet. This year will produce at least one star who will finally validate this space. My money is on Snooth right now but this could change as the year progresses. Stay tuned for a lot more on this subject here soon.

Wine Media Goes Digital -The traditional glossy wine magazines such as Wine Spectator and Wine Enthusiast will be forced to rethink their print business model this year and go more digital. I still think there will be the same amount of wine publications produced but the ones that are left will have figured out how to make money from their online presence and not just by print advertising sales. Of all of these magazines, Wine Spectator is the best positioned to flip the switch, open up their subscription site and become supported by their online advertising inventory. But I don’t expect to see them do this because they will see too much short-term risk in their current, but doomed, business model. 2009 will be a great year for new entrants trying to figure out this territory like Mutineer.

Americans Drink Less Wine At Lower Price Points – This prediction is linked with my first one but I think it’s important to note that the wine market in the U.S. will not grow as it has in the past. Not only will consumers drink less wine they will trade down to lower priced selections. With the U.S. dollar increasing in value, this will make imports more attractive especially from the Old World where vineyard land is a long sunk cost.

So there you have it; six bold predictions for 2009. I’ll revisit these in June and again in December to see what really happened.

Which ones do you think are right, dead wrong or what did I miss?

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Amazon To Sell Wine Online

by Tim on 9/11/2008

As reported by the Wall Street Journal and Reuters, Amazon.com will begin to sell wine in a just few weeks here in the U.S. The announcement came from The Napa Valley Vintners association and not directly from Amazon. Also reported was that New Vine Logisitics will be Amazon’s shipping partner when they go live.

Rumors have been circulating for some time that Amazon would enter the market but most observers thought they would concentrate on high volume brands. But the Amazon head wine buyer was on the floor checking out wines at the recent Family Winemakers of California and I have spoken with several smaller wineries who have been in discussions with them.

As I posted back in March, I think his is the most signifiant development in wine distribution since the repeal of Prohibition in 1933. And Amazon’s actions in the past 6 months have validated my hypothesis that medium to small wineries are their target. Their decision to work with regional wine associations is a good one from an industry relations, recruitment and PR point of view. I don’t think it was an accident the announcement came from the Napa Valley Vintners and think we’ll see announcements from other winery associations before Amazon formally launches their wine business later this month or in early October.

This is a great development for both wineries looking for online distribution and for consumers looking for small production, artisan wines. I expect the shipping fees to be reasonable like Amazon does for all their other products but their Prime service will be a must for serious wine lovers. For $79 a year, you get free shipping on all purchases with second day delivery. No word on if that speed will be honored for wine but if it’s just free ground shipping for wine, that will be huge for sales. With increasing fuel costs, shipping is becoming a real problem for wineries as it adds significantly to their customer price. If this is a non-issue, then wineries stand to benefit greatly from what Amazon if offering.

This is not good news for other online wine retailers who do not have the deep pockets to cover the significant shipping costs or the economies of scale that Amazon has. But I still think there will be a place for niche e-tailers like domaine547 and wine marketing sites like woot and The Wine Spies.

I think this is the biggest wine story of the year and will be blogging about what this means for wine marketing over at my company blog.

Cheers to Amazon and welcome to the wine business.

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Blogger Ethics and Disclosure

by Tim on 8/28/2008

The current controversy over a group of wine bloggers accepting a wine sample under the condition to write something — good or bad — about that wine has me reflecting over my code of ethics. Since I have commercial interests in the wine trade, I think it is very important to make full disclosures in order to avoid any conflicts of interest. It’s a simple code really… I accept samples but don’t agree to post a review, disclose when samples are provided in the post or podcast and I don’t review wines from producers I work with. It’s been posted on my “about” page for two years now since Alder brought the issue up and posted his own disclosure.

So I was deeply distressed to see two post this week suggesting I was not ethical in my review of Rodney Strong’s “Rockaway” Cabernet as part of a blogging experiment. The first post was by Wine Enthusiast critic Steve Heimoff who thought that we were “manipulated” by the folks at Rodney Strong. This touched off more comments with Mr. Heimoff directly questioning our ethics as wine bloggers. That might be a valid assessment if Mr. Heimoff had done his homework — no journalistic duty — and investigated this story further with those of us involved before posting his thoughts on the matter.

The second post that disturbed me was one from Tom Wark who took Mr. Heimoff’s logic one step further concluding, “I do think, however, that by agreeing to work on behalf of their subject they risk compromising the inherent independence that wine bloggers possess.”

Where did Mr. Wark get his facts for this post? Not from those of us who took part in the Rockaway experiment. Just like Steve Heimoff didn’t. And they are professionals not enthusiasts like many of us involved.

Do you see something wrong here? I do.

Before I get into the ethical implications of a professional journalist and seasoned wine PR professional not doing any investigation before making some serious accusations, let me backup and fully disclose the chain of events that got us here.

On July 30th, Jeff Lefevere of Good Grape contacted six wine bloggers with an invitation to participate in what he called a “blogging experiment”. The bloggers were Dr. Debs from Good Wine Under $20, Tyler from Dr. Vino, Megan from Wannabe Wino, Renee from Feed Me/Drink Me, Kori from the Wine Peeps and myself. Only Tyler declined and Joe from 1WineDude was added. To my knowledge, “several other leading wine bloggers” were not contacted or declined to participate. Robert Larson from Rodney Strong Vineyards was copied on this and all future emails from Jeff about the experiement but did not have any role in the dialogue.

Jeff’s request was pretty specific with the following portion salient to the current controversy:

“Here’s the give to get and this is my suggested execution path, not Rockaways:

* In agreement for receipt of the sample you agree to write a blog post on or around the week of August 18th.  You do not have to write anything favorable, but you do have to write a post with a word count between 300-500 words
* You can choose to write a review on the wine or if you choose not to review it you can write around any number of story angles about the wine/winery/concept, etc.
* I would encourage you, as I will do, to be fully transparent about the sampling.  In fact, I plan doing a lead up with a post or two about my interactions with Robert and the fact that wineries are starting to get wine blogging, take wine bloggers seriously and to engage us with a level of rapport usually reserved for only established media.”

There was no request for review, only a post. And this post could be anything of our choosing including negative reviews or commentary. In short, we had complete editorial freedom. Since my own ethics state that I do not promise a review, I thought that this request was within my personal code as long as I disclosed I received this wine as a trade sample. Yes, I thought is was somewhat of an unusual request but Jeff’s concept was several posts about the same wine happening the same week, so I agreed.

On August 11th, Jeff send out another email to the entire group with Arthur Black added as a guest blogger at Good Grape. Here he made to following request:

” I have committed to Robert [Larson of Rodney Strong Vineyards] that we would post in between next Monday, August 18th and Thursday the 21st.  300 + words is the requested minimum.  The notion here is to do something thoughtful and meaningful.  There is no editorial restriction, but I’d like the piece in whatever form you decide to take it to be something you are proud to stand behind.”

Attached to this email was a variation of the label graphics and a fact sheet. There was no press release or any other coaching. I tasted the wine over three evenings from August 11 without food and not blind, as I taste most wine samples. My notes were recorded into Evernote for future posting here. Over the next few days I did research online made notes and eventually turned this into an outline. At this point I took a vacation from blogging and enjoyed Disneyland with my family for 3 days.

When I returned, I flew to San Francisco and then went on to Sonoma where I intended to finish and post my review along with an analysis from a marketing standpoint for my company blog. Where I was staying lost their internet connection and later their power so I was not able to post until Saturday, August 23rd, 2 days after the requested deadline.

And that’s where this story should have ended but Mr. Heimoff, who makes his living tasting wine for Wine Enthusiast, posted his pointed critique on his blog. I think the context is important for everyone to understand here because just a week before the meme in the wine blogosphere was over the Wine Spectator‘s giving an award to a fake restaurant exposed by a blogger (well, at least they used a blog to do their sting operation). A firestorm of hatred for all bloggers was unleashed in the Wine Spectator’s apparently unmoderated forums. Even senior editor James Molesworth got into the act calling bloggers, “…lazy journalists.” It was not their finest hour which I will dissect in another post.

I believe both of these events are directly related.

The traditional wine press has not acknowledged wine blogs exist even as they begin to employ the medium. Their business model is challenged by social media and they are starting to feel the pain. It will get a lot worse in coming months and years as the wine buyer increasingly looks for wine recommendations online and are used to finding this information on search engines. And most wine buyers will not find their reviews, published late behind subscription barriers, but they will find reviews on wine blogs. For free. Without advertising from wine brands mixed with the editorial. And fully open for their comments.

I think the traditional wine press is getting concerned about us and are trying to use this blogging experiment to discredit all wine bloggers. But this will not work and the reason why is simple: Disclosure.

Everyone who has taken part in the Rockaway experiment has been totally transparent about the conditions and have made the proper disclosures. But where are the disclosures from Steve Heimoff and Tom Wark? They don’t exist on either of their blogs. How wine ratings are done is not even on Mr. Heimoff’s employers’ website which I would find disturbing if I read that publication.

So the bottom line for me on this whole thing is that Heimoff and Wark did not check their facts. They did not speak with any of the bloggers involved or Rodney Strong Vineyards (yes, I checked). I think they need to reassess their own blogging ethics, post a retraction of erroneous facts and offer an apology.

But that’s just me and my ethics talking. What do you think?

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Tonight I finally opened a wine sample I received earlier this year… a 3L box of California Chardonnay. I’m not much of a box wine guy because most I’ve had are really nothing to write about. At best, they are clean, simple wines sold at low prices. And this sample is not plowing that much new ground as it succeeds as a nice $6 wine… but I’m looking for a great $12 wine like the ones I normally drink on weekdays.

Has the time come for a $45 box wine?

Something on the order of an Eric Solomon, Terry Theise or Cameron Hughes selection would do well with wine lovers and I’m hoping to see something like this in the future. The big problem will be one of consumer perception which makes this category a problem sell at much over $25 a box.

So I hope that some enterprising distributor or importer will package their better wines in 1 liter TeraPacks. It’s better for the environment and saves fuel in shipping, a rising problem these days.

Who’s going to innovate here?

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I get a lot of press releases but don’t often publish them here as I don’t usually find an angle to blog about. But a release this morning by the Center for Wine Origins and Office of Champagne caught my eye for it’s use of a YouTube video:

[youtube]http://www.youtube.com/watch?v=AIprAxt7pXE[/youtube]

As a longtime wine lover, I agree with the objectives of this group in protecting their place names but I wonder if the average American consumer really would understand the group’s message. Would consumers buy less Andre or Korbel if those producers were forced to remove the word “champagne” from their labels? Are consumers of American “sherry” or “port” really looking for the real deal from Spain or Portugal?

I doubt it.

Back when American producers were using European place names to label their wine blends there was a clear point of difference between a Napa Valley “burgundy” and Pinot Noir from the French region. Now there is less difference in the bottle outside of a handful of the finest vineyards.

So is this distinction still relevant in today’s market or is it just semantics?

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Tom Wark of FERMENTATION has announced the nominations for this year’s American Wine Blog Awards. My work here didn’t rate a nomination this year which didn’t surprise me as my output over the past year has been substandard for such accolades, to be quite honest. So I think that puts me in the position to be somewhat objective and comment on blogging awards in general and these in particular.

American Wine Blog Awards logoMy main concern with the American Wine Blog Awards is not the name, although I’d prefer something more international, no it’s the voting process. If the Oscars used the same system as these awards, ‘Spider-Man 3′ or ‘Shrek the Third’ would likely win Best Picture as they were the most popular movies last year from their box office receipts. Both are well crafted films but they are not in the same league as ‘No Country for Old Men’ which finished 36th in 2007 ticket sales but took the top Oscar this year.

Why this discrepancy? Because only those in the film industry vote on the nominations and final awards.

So I propose that wine bloggers consider an association that creates an independent awards program modeled after the Motion Picture Academy Awards. As a placeholder, let’s call it the “Wine Bloggers Guild” but we’ll change the name if the discussion warrants. I’ve started a new thread over at Open Wine Consortium for wine bloggers and podcasters to discuss this idea and see if there is consensus for my proposal.

My intention is not to criticize the American Blog Awards, just create an analog to the Oscars to Tom’s People’s Choice Awards. I think there’s room for both. What do you think?

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Imagine there’s no scores…

by Tim on 3/18/2008

I wonder if you can…

But that probably doesn’t matter as the U. S. wine trade is addicted to the 100-point scoring system as the default method to differentiate and sell wine. Why? Because it makes sense to the American consumer brought up with the same system in school. Everyone, it seems, wants an A in either their term paper or glass of Chardonnay. And retailers feel compelled to sell and promote highly rated wines as they drive traffic to their store.

100_awards.jpgSo that’s what makes this proposal to abolish the 100 point system so interesting to me. No, it’s not from a blogger or consumer but from a wine retailer. Isn’t this cutting off your nose to spite your face, you ask? I hope not but a reading of David Lillie’s proposal makes clear that he wants wine lovers to look beyond just the numbers and concentrate on the enjoyment a wine can bring.

He concludes his argument underscoring that precise scores are not the complete measure of a wine:

“The most important argument against the point system is contained in the dedication and hard work of thousands of producers, mostly European but with a growing number in the US, whose efforts to bring delicious naturally made wines to the consumer cannot possibly be graded with a number.”

This got me thinking about the parallels of wine and film criticism. Before I got into wine, I spend a couple years in film school and remain an avid film buff today. One of the elements that make great movies are the technical aspects along with the story and performances of the actors. When these are in the right balance, magic can happen. There are other times when the intention of the director is to just make an entertaining film. Here the technical aspects are most likely emphasized but there is still room for creativity as viewers of recent works of Michael Bay and Paul Greengrass can attest.

I’ll make my comparison to wine illustrated by a couple examples. I think Sergio Leone’s “Duck, You Sucker” is one of the best films in the Western genre. My wife, on the other hand, thinks it’s a long, boring and strange movie. The opening set piece includes some of the most interesting use of the camera in movie history. I see the homages to other Westerns; my wife sees extreme close-ups of peoples’ mouths while eating. It’s the context of the viewer and knowledge of film that makes all the difference in appreciating this work.

As blogged here recently, Ridge Lytton Springs Zinfandel is one of my personal favorite wines. But I couldn’t get my mother to drink it because she thinks all red wines, “…smell like dirt!” She can’t imagine how such a wine can taste good if it smells like it does to her. But she is an avid Chardonnay drinker who values Charles Shaw wines that I find lacking. Is she wrong? Of course not, it’s our context and experience with wine that is different. I’ve learned to appreciate the nuances in wine where she just wants something nice to drink with dinner.

So my rating of 92 or 4 stars will not convince my mother to try Ridge Zinfandel and she probably doesn’t care that I rated Charles Shaw Chardonnay an 80. Nor will my wife sit through another Sergio Leone movie when she’s perfectly happy watching “Top Gun” for the 50th time on cable.

The same can be said for wine and too many wine lovers use ratings as a way to select “good” wine when they should let their palate decide. Yes, there are technical aspects that some of us obsess over but the bottom line is the wine should taste good to you no matter what the critics say.

I don’t know David Lillie or his store, Chambers Street Wine in New York. But I’ll bet it’s a lot like Solo Vino where every wine is hand selected not for it’s Parker score but for it’s expression of the variety and region of origin. Scores will be with us for a long time, but it’s voices like Mr. Lillie that have me seriously thinking of not using the 100 point system in my reviews.

Hat tip to Craig at The Wine Camp Blog for Twittering the link this morning.

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Amazon: The First Long Tail Wine Retailer

March 6, 2008

News broke this morning that online retail giant Amazon.com will enter the wine retail business. Since Decanter reported this story as an alliance between wine.com and Amazon, I was not sure if anything was really news since their relationship was announced some three years ago. And it appears the folks at Decanter have realized their [...]

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Is Terroir a “Meaningless Argument”

February 20, 2008

I’m researching a post about Stormhoek and I came across this podcast with Jason Korman I had not yet heard. During this discussion Jason asserts that terroir applies to all wines wherever they are produced making terroir, “…a meaningless argument…” from a marketing standpoint. On one hand, I agree with Jason that terroir is too [...]

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This Just In… Wine Blogs Are Boring!

February 16, 2008

There was a little bit of discussion in the wine Twitterverse this evening about a post over on PBS’ MediaShift blog. In a rundown on video podcasts, writer Jennifer Woodard Maderazo described most wine blogs as having, “…content dull enough to bore an enthusiast like me.” Not sure which wine blogs she is referring to [...]

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Apple TV is Big News for Wine 2.0

February 16, 2008

One of the announcements at last month’s Macworld Expo was Apple TV Take 2, an update — rethinking really — of the unsuccessful media player released a year ago. Apple CEO Steve Jobs featured the new iTunes movie rental service as the killer new feature of this update but I think video podcasts will be [...]

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