Counterintuitive Thinking About Value
Counterintuitive Thinking About Value
Two wine titans are approaching the quality/value issue in different ways, but both are betting that americans are savvy about wine label lingo.
How closely does the average American consumer read a wine label when he or she goes into a retail store or supermarket to shop for wine? What words draw him closer to a purchase? What compels that person to spend more than he planned to? Two very savvy wine-industry executives are betting big money that the fine print increasingly matters, and that the "growing sophistication of American wine drinkers" is not wishful thinking on the part of marketers.
Readers of Wine Enthusiast, I assume, are accustomed to looking for appellations and blend percentages on labels, plus terms like "single-vineyard," and can weigh their importance. But for the vast majority of people who purchase wine, that assumption can't be made. So the recent initiatives on the part of Jess Jackson and Fred Franzia seem to me doubly counterintuitive. Both of these men are taking risks. One is offering a low-priced wine in a region known for high prices. The other is willing to accept reductions in sales in order to produce higher-quality wine.
Fred Franzia, the president of Bronco Wine Company, is famous for his $2 Charles Shaw Wines ("Two-Buck Chuck"). Now he has taken the strategy one step further by introducing $4 Napa Creek wines, made almost exclusively from Napa Valley grapes. When most wines made from at least 85% Napa fruit start at $15-20, cruise at around $40 and then go into the stratosphere, people are astonished that Franzia is able to release wines at that price point.
Franzia is not only the largest vineyard owner in California, but he also owns the wineries, the trucks, the bottling plants—and his distribution, in this case, goes straight to Trader Joe's. So many of the middle expenses that may raise the price for Napa wineries are not an issue for him. But still, this must be considered a risk. Yes, the word "Napa" on a label is a draw, it has cachet, but does that cachet appeal to the casual wine shopper? Franzia is gambling that it does.
Meanwhile, Jess Jackson is tinkering with a proven winner, his signature brand, for the purpose of improving quality. Kendall-Jackson's flagship wine, the Vintner's Reserve Chardonnay, sells over 2 million cases nationally. But from the 2004 vintage on, Jackson will cut production and raise prices, based on the fact that he will be using only estate-grown grapes in that bottling. Kendall-Jackson is a huge landowner in California, and the company has extensive contracts with other growers. The exact source or sources of grapes for his wines has not, until now, been an issue. But he is making it an issue, exercising tighter quality control so that he can justify putting the words "estate grown" on the label.
It's a crazy market out there, very much segmented by price. The fabled wine glut may be over, but international competition is continuing to put pressure on companies to attract attention in an oversaturated market. Some like to use cute animals, strange graphics or catchy names, others like Jackson and Franzia are fine-tuning the fine print, relying on Americans' savvy and sophistication. That's a strategy I can respect—and I can't wait to see if it pays off.
Enough about marketing. This issue is all about what's in the glass: American Syrah, Italian wines and fine Burgundy.
Syrah is a great food wine, a great collector's wine, and a wine to be enjoyed for its nuances and the changes that terroir and technique can make. Syrah is becoming the darling of robust red wine drinkers, and America's Syrahs are grabbing their attention. Tasting director Joe Czerwinski and members of the tasting panel sampled hundreds of American Syrahs for this report, which begins on page 26.
Most of the Italian wines Americans are familiar with are based on Sangiovese, Nebbiolo and Pinot Grigio. But Italy is home to literally thousands of other grape varieties. On page 38, Monica Larner discusses 10 of these little-known varieties, and provides a guide to the flavors and top producers. It's a great guide to hidden Italy.
And on page 44, Roger Voss tracks the changes taking place in Burgundy, where négociants, who are traditionally merchants, are becoming more and more involved in vineyard, winemaking and blending decisions—and the wines show it, and so do the sales.
Take this issue along with you to your wine shop. It'll come in handy in the Californian, Italian and French aisles in particular. And don't forget to read the fine print.