The Domestic Wine World in a Nutshell

Constellation Brands, the 2nd largest wine company in the U.S. behind E&J Gallo, has turned a nice trick.  Since May, their PR activities and the ensuing media coverage (across a diversity of topics) largely encapsulate the trends in the domestic wine world if not the larger American business environment. 

I pay attention to Constellation Brands.  I read the annual report, dry though it may be, and while I find that Constellation tends to get painted with the, “Corporate wine” brush that suggests a blend of big business and wine is necessarily bad, I haven’t found that to be the case with Constellation, at least anecdotally.  In fact, most former employees of Constellation that I’ve talked with offer respect for the organization while citing a host of more individual reasons for why they moved on.

No business is perfect, but Constellation hardly seems to be the bogeyman that the Agrarian Utopianists would have you believe.  Though, one quote from their 10-K seems to summarize the largely unspoken tension that exists between wine big business, the land and the globalization that tugs at both of them.

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“We are primarily a branding consumer products company and we rely on consumers’ demand for our products.  Consumer preferences may shift due to a variety of factors, including changes in demographic or social trends, public health policies, and changes in leisure, dining and beverage consumption patterns.  Our continued success will require us to anticipate and respond effectively to shifts in consumer behavior and drinking tastes.”

Opinion with the most strident wine conservatives holds that a winery should be a rock in the stream, rooted in terroir, not yielding to the fashion of the day and certainly not functioning as a branded, “consumer products company” answering to the vagaries of fickle, “consumer preferences.”

Yet, pursuant to the essential truth or not, that’s where the domestic wine world is today.  Let’s take a look at Constellation headlines dating to May of this year to see the domestic wine world trends in a nutshell:

Targeting Millenial Wine Drinkers Online / May 12, 2011      
Key reference(s) in the article:  Sensory analytics to understand consumer preferences.  Brand building akin to Procter & Gamble and Coca-Cola.  Expansion of its Project Genome research that studies wine drinkers’ buying habits.

Under the Microscope:  Constellation Brands’ push into digital marketing / May 13, 2011      
Key reference(s) in the article:  “Social media has caught executives’ interest, given that most wine is discovered by consumer(s) via personal recommendation.”  “Since implementing the psychographic targeting, the company has seen an increase of click through rates of 150%, increased fans of 75%.”

Constellation Takes Long-View Approach / May 15, 2011                    
Key reference point(s) in article: “Much of the work Constellation did in reshaping the company came during the recession. For a time, sales took a hit and losses were evident.  But the company continued to pay down debt and build cash flow. ‘We could have pulled back and stopped investing in the business.  That would have been dangerous.  But we didn’t overreact,’ said CEO Rob Sands.’”

Europe:  Constellation plots greater push into Eastern Europe / May 18, 2011      
Key reference(s) in article:  While Constellation divested itself of the majority of this business earlier this year, they did maintain a minority stake in the organization renamed Accolade Wines on July 1st.  “Speaking on Eastern Europe more generally, (Constellation’s General Manager for Europe, James Lousada) said that Constellation is prepared to play a long game in the likes of Poland, Ukraine, Czech and Russia.  ‘If we start now then in five years we will have a significant business in those countries.’”

Constellation Plans Major Innovation Push In 2011, With Launch of 20 New Wines / May 18, 2011            
Key reference(s) in article: “Constellation Wines U.S. President Jay Wright said today that the company is planning a blitz of 20 new wine products this fiscal year (ending next February), targeting fast-growing segments like sweet red blends, Prosecco, Moscato and Malbec. Among the new rollouts will be a sweet red blend in the $8 to $11 range, Primal Roots, and a new offering in the rising unoaked wine segment, Simply Naked (around $10 a bottle). Both will launch June 1st. A new premium Spanish brand, Rioja Vega, is also poised for rollout.”

What Does China Need?  More Table Wine / May 20, 2011
Key reference(s) in article: “Chief Executive Rob Sands of the New York-based beverage company said he will formally announce a top executive for its Asian business.  Sands says he sees a sweet spot in the Chinese market in imported table wines … that market has grown 20% a year in the five-year period leading to 2010, according to a report by Rabobank.”              

Constellation Unveils Winery Expansion / June 8, 2011      
Key reference(s) in article: “’This expansion is a cornerstone for the future of our business,’ (COO Jay) Wright said.”

Constellation Brands to Cut Jobs to Save Money / June 30, 2011      
Key reference(s) in article: Despite higher than expected earnings in its first quarter of fiscal year 2012, Constellation plans, “…to cut about 100 jobs, or 2.3 percent of its workforce, as part of a business realignment meant to save money … the company expects the moves to save it more than $10 million …”

Constellation Sales Slide in First Quarter / June 30, 2011      
Key reference(s) in article: “Constellation has rolled out around 50% of the 20 new wine products it has slated for this year, with Rex Goliath Moscato, Ruffino Prosecco, Arbor Mist Pomegranate Berry Pinot Noir and the Simply Naked unoaked line already making their debuts.”

Summary

By looking at the wine business through the prism of Constellation’s news, I see a number of trends that are palpably present for the entirety of the domestic wine business:  Globalization, digital, Millenials, investing in growth, layoffs, new “hot” segments or varetials like Prosecco, Moscato, unoaked chardonnay, sweet wines.

While these trends are on a more granular level than the seismic macro shifts that Mike Veseth describes in his new book, Wine Wars, the point continues to be reinforced for me that we’re at the tail end of a Golden Age of wine, the agrarian ideal is quickly becoming a slippery slope necessitating changing with the times and 20 years from now the first decade of the millennium will be viewed as the halcyon days of old. 

Source: http://goodgrape.com/index.php/site/the_domestic_wine_world_in_a_nutshell/

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Grape Radio Interviews Author Rex Pickett

My friends at Grape Radio have posted a great interview with Rex Pickett, the author of ‘Sideways’ and its sequel ‘Vertical.’ Although the guys spend much of the podcast talking about ‘Sideways’ Pickett does work in plenty of details about his latest novel. Between this and the written interview posted recently by Blake Gray, I [...]

Grape Radio Interviews Author Rex Pickett originally appeared on Winecast. Licensed under Creative Commons.

Source: http://feedproxy.google.com/~r/Winecast/~3/sjlaqqM3PSg/

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Announcing WBW 71: Rhones Not From The Rhône

The theme for WBW 71 is, "Rhones Not From The Rhône." Pick any wine made from a variety best known in The Rhône but not made in that famous French region. It doesn't matter if the wine is white, pink or red; still, sparkling or fortified. Whatever you choose just needs to be made from primarily a Rhone grape and come from a region not in France.

Announcing WBW 71: Rhones Not From The Rhône</a> originally appeared on Winecast. Licensed under Creative Commons.

Source: http://feedproxy.google.com/~r/Winecast/~3/jrDA0wzAgrw/

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Help Steer the Direction of an Award Winner!

Generally speaking, I do very little public housekeeping here, but it’s time for some remodeling and I want your feedback. 

Despite winning some awards and receiving significant positive feedback about the design of this site, I haven’t materially changed the look or the function of Good Grape since November 2006.  Times have changed a lot in the intervening (nearly) five years.  At the time, Wordpress was a very secondary blogging platform choice behind MovableType (I chose door #3).  Facebook had recently announced general availability to the public from its former days of being collegiately oriented; Twitter launched, but was barely a blip on the radar, YouTube was hot (but not ubiquitous) and smartphones were still very niche in general adoption.  Tablets like the iPad?  Nope, at that point people were stoked about rumors of an iPhone that was set to be released sometime the next year. 

A lot has changed in five years and this site has barely kept pace, making due with duct tape and spittle.

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A number of regular readers have let me know that pieces and parts of the site don’t always work, or the site is slow for them, or it’s hard to comment, or archive pages are junky looking, or links take you away from the site, etc.  And, forget about reading this site on your mobile phone – Good Grape equal’s bad mobile mojo.  The list goes on and on and I have my own list of wishes and want-to’s 35 items deep.

So, here’s the question and the crossroads I’m facing:

Do I keep the same general design (with some slight modifications like making the main text area wider and re-doing the navigation) and simply leave a classic design alone, focusing on enhancing functional and technical aspects of the site?

Or,

Do I take this opportunity to blow it out and set the bar for what a quality, beautiful, professional wine blog should look like, plus all of the social and mobile bells and whistles?

Readers, friends, colleagues, and peers: Your feedback is very welcome.  Should I mess with a good thing for a potentially greater thing, or do stay true to the visual identity in place and simply remodel focusing on functionality, familiarity and usability?

Please leave a comment.

Source: http://goodgrape.com/index.php/site/help_steer_the_direction_of_an_award_winner/

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Welcome to the Future

I won’t have a chance to get everyone an update on wider life for a few more days at the least (things are busy both professionally and personally, well definitely personally) but I was sad to see that social media darling Gary V has chosen to close Cork’d. Cork’d To Close It’s Doors It’s an [...]

Source: http://winewithmark.info/archives/632

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The Uber-Wealthy's Wine Industry

By all accounts the upper end of the wine industry in the United States ($25+ per bottle) is in full recovery from the retraction that occurred in 2008-2010. -Retailers in metropolitan areas report much more robust sales -Auction houses are...

Source: http://feedproxy.google.com/~r/FermentationTheDailyWineBlog/~3/Z4pWD6yljQE/the-uber-wealthys-wine-industry.html

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