Ryan Collins
 
February 27, 2012 | Ryan Collins

Biodynamic Farming: following the sun

Biodynamic farming is complex, sometimes hard to explain and sometimes hard to quantify. It involves many areas: preparations, compost, biodiversity and an awareness of the rhythms happening all around us.  I want to talk a little about using a Biodynamic calendar and the intention behind our practices during certain periods on the calendar by highlighting the thoughts of Rudolf Steiner and all those who have continued what he started. The biggest thing to understand is that we believe the moon has an influence on animals, plants and the activities we perform on the farm.

We all follow the sun over the course of the day: it rises in the east, reaches its peak at midday then descends to the west. In summer, the sun’s arch is much higher than it is in winter. In the northern hemisphere, the arch gets progressively higher every day from December 21st (winter solstice) until it reaches its highest arch on June 21st (summer solstice) from then on the arch slowly lowers again. We call this cycle one year and it coincides with the earth doing a full rotation of the sun. When the sun slowly gains height in the sky, we experience spring and then summer.  When the sun begins to descend, we experience autumn and winter. During spring and summer, the earth ‘breathes out.’  Plants focus their energy on new growth and reproduction. In fall and winter, the earth ‘breathes in’ and plants refocus their energy towards the soil mostly on root development and storing energy in these organs until the cycle starts again.

 

Time Posted: Feb 27, 2012 at 10:11 AM
REX HILL
 
February 1, 2012 | REX HILL

Dear Pinot Noir and Chocolate: I Hate You

He Said...
- Mike Willison

I'm not sure who to blame for this. Probably Hallmark for their insistence in sissifying February 14th into the willowy, cream-puffed doily that it has become, perpetuating the notion that chocolate, pink stuff, tulle and a dozen roses is everyone's idea of romance. I disrespectfully disagree. In wine country, at least here in Oregon, there is an obsession with pairing Pinot Noir and chocolate when Valentine's Day rolls around. It seems that every tasting room in the Willamette Valley is hawking some craft chocolatier's nibblies with their wine if they aren't obsessing over bacon, or bacon and chocolate or, worse yet, chocolate infused wine. I'm going to go out on a limb here and just say it, Pinot Noir and chocolate sucks. It sucks because of how silly everyone looks gushing over it. It sucks because that wad of crappy milk chocolate is disrespectful to the wine. It sucks because that crappy wine is disrespectful to the delicious chocolate. Chocolate is not a magic ingredient. It does not make celery better, or clam chowder, or sitting in a hot tub. It is not as cool as duct tape. At best, combining wine and chocolate is a gateway pairing, hopefully leading one to learn and do more with their energies. At worst it is lazy, boring, and, frankly, just awful. It isn't romantic, really, and could lead to a pretty weird night, but the better pairing is Pinot Noir and mushrooms. Brown stuff. Dirt. Fungi. True love.

 

She Said...
- Carrie Kalscheuer

I'm going to have to disagree with your chocolate and hot tub assessment. Other than that, I concur. The chocolate and Pinot Noir pairing has been a pet peeve of mine for many years. I've grown weary of explaining how these two don't taste good together, and from the incredulous looks on people's faces, they don’t believe me regardless of how passionate my explanation. So, instead of talking people out of the Pinot Noir and chocolate pairing, I’m going to talk them into the right pairings. I am hardly ever without chocolate close at hand (no less than three different bags of chocolate sit in my desk drawer at this very moment), so have amassed an arsenal of pairings that once tried will make you never want to reach for Pinot Noir and chocolate in the same sitting again.

My absolute favorite chocolate pairing is Banyuls, a full-bodied sweet red wine from France, but it’s admittedly hard to find. Easier to find and oh-so-appropriate for Valentine's Day is the sexy, delicious combo of Brut Champagne and milk chocolate. I've reached for coffee, Port, Madeira, Sherry, Armagnac and even a cold Guinness to accompany my chocolate cravings. I’ve had some success pairing chocolate with certain Zinfandels and Cabernet Sauvignons, and my favorite accidental discovery was how stunning chocolate is with Mezcal (the higher end stuff, people, not the worm-in-bottom kind).

So please, Valentine's Day revelers, try these suggestions with your chocolate next time. Enjoy them, love them, adopt them as your own, and leave the Pinot Noir for better pairings – yes, like mushrooms.

Time Posted: Feb 1, 2012 at 10:13 AM
Bill Hatcher
 
January 31, 2012 | Bill Hatcher

The Capital Shell Game: Liquidity & Value

A principal tenet of shareholder wealth theory is that excess returns beyond those necessary to operate the business and fund capital expenditures should be returned to the shareholders who will most optimally reinvest.  In a goods and ideas producing economy, this mechanism worked reasonably well.  Shareholders would reinvest dividends and capital gains in companies that innovated and produced high quality products at competitive prices.  This very much characterized the American economy from the end of WWII until late in the last century.

In the 80’s, a tectonic shift began to take place, however, as investment banks diversified from the traditional role of advising businesses and conventionally raising capital with securities and bank debt to create financial products and ultimately financial markets.  These products grew ever more arcane as the banks competed for the best mathematicians and physicists MIT, Harvard, Princeton and Chicago had to offer.

Eventually, these instruments became Frankenstein algorithms whose creators could not divine or control unintended consequences.  As many of the products were designed to trade outside the regulatory realm, investment banking enjoyed a shelter where the sheer velocity of trading produced billions of dollars of liquidity with no underlying value.  Even something as basic as the Dow Jones Industrial Average grew from roughly eight million shares of daily trading in 1980 to four billion today.

As long ago as 1637 in Holland when a single tulip bulb could sell for ten times the annual salary of a skilled craftsman, financial investments detached from underlying value are not sustainable.  In the global financial crisis, which began in 2007, the problem could be generalized as a lack of capital reserves to support the debt creating the illusion of liquidity.  In the simplest rendition, homeowners borrowed more than their houses were ultimately worth when the real estate market crashed.

Investment banking functioned on the same flawed principle, only in far more complex ways.  A credit default swap, for instance, is in fact insurance against the failure of a financial instrument or institution.  However, because it is arbitrarily designated a swap and not insurance, it isn’t regulated under federal law and thus is  exempt from having adequate capital reserves to back it.  Without these reserves, the investment banks were unable to withstand what in commercial banking would effectively be “a run on the bank” and so, Bear Stearns and Lehman Brothers, after a century of business, fell in a matter of days.  Others, “too big to fail”, were bailed out by the federal government.

The repeal of Glass-Steagall in 1999 was an accelerant as commercial banks became free to assume the trading and investment functions hitherto limited to merchant or investment banking.  As a result, commercial banks began shifting deposits from lending to trading.  Today, only 8% of bank deposits are lent to businesses.

Concurrently in the 80’s, a new investment entity was emerging in the form of private equity.  Much in the news now because of Mitt Romney’s tenure at Bain & Co., private equity firms do invest in companies that produce goods and services, following the postwar model but tend to do so from a short-term financial play as the typical private equity investment lasts five years or less.

In 1980, there was about $5 billion in private equity investment.  By 1995, that figure had climbed to $125 billion.  Currently, according to Bain, private equity firms have nearly one trillion dollars of uninvested capital.  In the same report, desirable private equity investments were characterized as having strong cash flow while requiring low capital expenditures and limited working capital.  Indeed, it’s an attractive low-risk investment profile but one unlikely to create jobs or new products.

Private equity doesn’t tangibly invest in products, brands or people but rather, in financial statements.  Products are inventory, brands are marketing expense and people are overhead.  The goal is to minimize these costs to increase return on assets and return on equity.  While a seemingly indisputable goal, when the investment horizon is short, the financial engineering may destroy the long-term competitive viability of the company after the investors have broken camp.  Tangible capital is often destroyed rather than created, instead merely providing liquidity to start the cycle again.

The destruction of tangible capital is by no means limited to private equity.  Publicly traded firms have similarly shifted from creating capital to creating liquidity.  Since the beginning of the credit crisis, U.S. companies have accumulated  nearly a trillion dollars in cash while capital expenditures have fallen 26%.  Granted, there is little incentive to invest when there is excess capacity at hand yet these are not all smokestack firms that have competitively lost out overseas.  Among them are Cisco with $40 billion in cash, Microsoft with just under that amount and Google with $35 billion.   In 1980, total corporate net cash flow was around $200 billion; in 2011, it was just short of $2 trillion.

Far and away, the largest use of corporate cash is for takeovers.  In 2011, global merger and acquisition activity exceeded three trillion dollars.  In some cases, synergies are created that revitalize one or both entities but more often, the consolidation results in the elimination of jobs, plants and products.  In 1980, there were 20 million manufacturing jobs in the U.S.  Today, there are 15 million.  When one considers that most of the high-tech industry has developed since 1980, our core manufacturing has probably fallen below 10 million.  Some of this decline is attributable to greater productivity and the reliability and wearability of durable goods as well as a greater proportion of income being diverted to services such as medical care by an aging population.  Nevertheless, one is more often surprised to see that a product is imprinted with ‘Made in the U.S.’

Without a change in incentives to invest in value producing capital, ten percent unemployment will be institutionalized and, correspondingly government will continue to grow to provide the income and services for the disenfranchised.  This is not an apology for lack of initiative but simply stating a fact that an uneducated and unskilled work force cannot create jobs or services.

The American education system has become biased toward high value technicians—engineers, researchers, systems analysts—who comprise but a fraction of a complete work force.  So, even where there are jobs, the jobs go unfilled for want of qualifications.  Someone in a local high-tech firm recently lamented that he had fifty open jobs but couldn’t find qualified applicants.

Even if educational reforms were instituted, the stubborn fact remains that America doesn’t make things anymore, instead having first shipped jobs offshore, then capital, then knowledge.  It remains to be seen if we can still create industries around technology to come.  If instead, we continue on the present course, productive capital will continue to decline, unemployment will continue to grow and the gap between rich and poor will come to resemble the social fabric of 18th century Europe.

Time Posted: Jan 31, 2012 at 2:21 PM
REX HILL
 
January 26, 2012 | REX HILL

Getting a bit sentimental/ philosophical about our love for wine

He Said...
- Mike Willison

I've been thinking a lot lately about how very funny it is that I work in the wine industry. I mean, as a child I'm certain that, because I passionately adored Smarties, one day I would work as a Smarties technical taster and ensure stringent QC across all of the dusty pastel colors/ flavors. Incipient ambition, I felt, was going to prove to be my greatest asset. This dream was hastily dusted off, like the candy's own residue on one’s fingers, as a passing fancy by my parents. Rightly so, likely, as I then became infatuated with Twizzlers, Dr. Pepper, Dungeons & Dragons, and (finally) girls (although the D&D made the girls thing a bit unlikely). Like the bleats of a baby bird for more regurgitated grubs, my dreams would carom off of my parents' stoicism into the forgotten ether.

As I grew older my passions became a bit more fixed, with less tangential foolishness and puppy-like stick-to-itiveness, I began to realize that all of these early passion-ettes were driving me towards an inevitable explosion of real, honest to god, unbridled enthusiasm; In this case, for wine.

Just yesterday someone asked me what my favorite wine is. I realized that really don’t have an answer. I can tell you what the first wine that made me really happy (1989 Ridge Geyserville). I can tell you also that I used to pilfer wine from the gun at the bar of the country club I worked at when I was a teen ("Chablis"). I can further tell you that there are wines that I thoroughly dislike but will always try again, just to be sure (Barossa Shiraz). Maybe the most important thing that I can say is that every glass of wine I encounter is an adventure that can only be realized at that very moment. It may be kind of a lousy adventure, like going to buy stamps or returning home to see if you left the oven on, but it also just might be the most exciting, fascinating and spectacular fun you have ever had and everywhere in-between. In this case, I truly am living the dream. Love wine because of its potential for awesome, everyday, and you will be a better, more successful, more attractive person with an 18 charisma and +1 to beguile.

 

She Said...
- Carrie Kalscheuer

This post, in all of it's poetic excess, has sat unanswered on my desktop for months. I don't often extoll the virtues of wine to such degree (at least not until I've consumed at least a bottle of the stuff in question, and by that time my writing skills are subpar - I could never have lasted as a beat poet). But today I find myself in a similarly, albeit more concisely, reflective mood.

Why I love wine (today): wine is one of the oldest things in the history of man, yet is ever-evolving. It can be likened to politics, religion, even love in this regard– and that's a powerful thing. We will never completely 'master' wine. It will always have a shroud of mystery, even to those of us who leave work with purple hands on a daily basis. It expresses itself differently every year, in every region and with each different winemaker. It changes, grows, develops every day in-bottle. It will one day die. It's different for each taster – a uniquely personal experience. Talking about wine is a personal expression of sorts, in fact; a way to convey what each of us thinks and feels about a shared pleasure. Maybe this is why wine is considered more sophisticated by comparison to other agricultural outputs – it transcends the everyday and speaks to the greater depths of what it means to be human.

Time Posted: Jan 26, 2012 at 10:15 AM
REX HILL
 
January 18, 2012 | REX HILL

Movies are important! What happens when you add wine.

He Said...
- Mike Willison

Most wine enthusiasts read or saw the tale of soggy and fragile Miles as he wended his way through California wine country with his philandering friend Jack in "Sideways." Some people even figured out that the story isn't really about wine, but rather the journey of self-discovery of one sour guy that has found himself in a bit of a rut caused by social, personal and professional ennui, with wine country as the background. Others, too, even realized that Pinot Noir, the brittle and tenuous grape variety that Miles holds so very dear (although secretly taking the silver in favor of his gold medalist Cheval Blanc, made of mostly Cabernet Franc and Merlot), is a thinly veiled metaphor for Miles or, more specifically, the way Miles views himself: a simple thing in need of just the right amount of love, sun, water, and elemental intake to produce something of incomprehensible beauty and wonder.

I then began to wonder who else we could cast in the shroud of grape variety metaphor. To wit:

Cabernet Sauvignon (Hollywood) - The character would be some obstinate tightwad that is stuck in his ways and goes into his dotage convinced that everyone else is woefully uneducated so he treats all of humanity like shoe scrapings. As he reaches his death bed, alone, wrinkled, bitter, a prune, fetid and vainglorious he has no regrets and his last thoughts are of firing his house staff before he has to pay them any overtime. Starring Jeremy Irons, Max von Sydow or Frances Fisher

Viognier (Hollywood) - A young, charismatic Frenchman unexpectedly excels at the American game of baseball and is drawn to the stadium limelight by a showy, greedy and tanned talent scout for the LA Dodgers (Chardonnay, played by Matthew McConaughey) that has wagered his career on the young star. In order to guarantee Viognier’s success, Chardy gets him hooked on HGH and the inevitable excesses that come with fame (think Jeremy Giambi or Kenny Powers) which of course lead to his muscle-bound demise. The wistful denouement has Viognier coaching in the Carolina League for the Lynchburg Hillcats of Virginia which, quite clearly, suits him perfectly. Starring Gaspard Ulliel, James Franco or Robert Redford

Zinfandel (Canal+)  - Looking for substantive meaning in his life, a wealthy Wall Street business tycoon leaves his job and his oppressive, mean-spirited and pinched-looking fiancée in search of the family and life he never knew. The film is lousy with sweeping, long, and contemplative camera shots that highlight the natural beauty and wonder of his voyage of self discovery. He visits extended family in Puglia, Italy where he falls in love with a local open-diving spear-fisherwoman that reveals to him his heart. They together travel to his family’s ancient home in Dingač, Dalmatia in Croatia where the fig trees, Zabrada Mountains and the Adriatic Sea provide a stark, open contrast to the rusting, closed-minded culture of the old bauxite miners trying to encroach on Zin's family farm (they parallel the Wall Street tycoons, of course). They will fight to preserve the family heritage, for each other, and ultimately for their souls. Starring Alexander Skarsgård, Alessandro Nivola or Colin Firth

 

She Said...
- Carrie Kalscheuer

While I'm all for drawing comparisons between wine and one's other interests, the movie/wine metaphor falls short for me. I don't immediately think of plot lines when I think of wine, nor characters reflected in the lifecycle of the grape. Rather than regale you all with comparisons to zombie-driven, apocalyptic-themed action films or fluffy romantic comedies (which, as anyone unfortunate enough to have watched movies with me will tell you is all I watch), I'm going to speak to the Sideways phenomenon.

Sideways, and the subsequent impact that it had upon the wine world, amazes me to no end. Yes, the character of Miles may well be a metaphor for the Pinot Noir grape itself, and that might be exactly the correlation both author and director are going for, but it actually bothers me to think so. The reason is both simple (I love Pinot, despise Miles) and complicated.

The complicated bit: when someone mentions Sideways, it is almost always in the context of Pinot Noir or Merlot, as if this is solely as far as the mentioner got in his or her research on wine and that by seeing the film, said mentioner has now become expert on all things Pinot and Merlot. The first bug on this is one you've already touched upon: that wine is merely a backdrop for the bigger story. Had that been widely recognized, I dare say I may actually enjoy this film. However, not many seem to understand this. Moreover, the dialogue, while happily accurate in certain scenes (Miles explaining how to properly taste a wine), is pretentious and egregious in others.

Possibly the worst of these last two is hidden within the "phenomenon" I alluded to earlier. There was a marked increase in Pinot sales and an almost equal decrease in Merlot sales after the release of the movie. As someone who heads up the direct sales program for a Pinot Noir-producing winery, this makes me happy. But as a wine geek, this irritates me. How could one comment in a movie tank Merlot sales? Because pretention in the wine world goes a long way, even if only delivered by a character in a movie. Miles seems an expert, yet he's really not. He's an amateur taster; a writer with ample time to drive into wine country. A better tactic is to find out for yourself what you prefer to drink, ‘cause see, the joke of the whole thing is in your first paragraph – the prized bottle in Miles' collection is exactly as you describe: Merlot blended with Cabernet Franc. So much for "I will not drink a x*%@ing Merlot!"

Time Posted: Jan 18, 2012 at 10:23 AM
REX HILL
 
December 22, 2011 | REX HILL

The Most Excellent Wines of the Year (In our little universe)

He Said...
- Mike Willison

We thought we'd take a slightly different tact with our "Best of..." list for 2011 by looking at three totally subjective, categorical winners from the past year. They may not be the highest scoring critic's darlings, or even an uber-cool, never-heard-of ancient variety made by forensic retracing of the steps of Thomas Jefferson's cellar hand, but they were what we loved over the course of one painstakingly beautiful year of wine drinking.

The Wine We See Everyday-

2010 REX HILL Willamette Valley Pinot Noir- Yeah, I know I'm a bit of a stinker for choosing this one since I've had it and you haven't, but I've been so excited about this ever since we decided on the final blends and the results are absolutely delightful. It’s a perfect snapshot of the 2010 vintage, with as much distinctive character as I've seen from this varietal in many years. If you’ve ever smelled living mistletoe (don't eat it) you may recognize the earthy, bright, and tart berry nose. Classic red fruit profile with so much snappy acidity you can dance to it.

The Wine in our Neighborhood-

2010 J.K.Carriere Glass- You'd have to be some kind of a jerk to not absolutely adore this wine and everything that Jim Prosser & Co. do up on Parrett Mountain. It might be the best rosé this side of Domaine Tempier, at a fraction of the cost, with the added bonus of supporting one of the best people in the state of Oregon. The wine is but a whisper of salmon colored, with the faintest suggestion of fresh fruits and hazy visions of swirling summer afternoons wearing a blousy linen shirt as some glorious former version of yourself. The perfect wine for the dog days, but the ideal wine for this awful time of year, too. I mainline the stuff when I am not in my cryogenic chamber being revitalized.

The Rest of the Known Universe-

2009 Hirsch Grüner Veltliner Lamm- That's right. The best wine I had all of last year was an Austrian white wine. Second place was a German, and I’m not telling what it was, but Terry Theise is involved. Grüner can be too steely and laser beam, too green, too goopy, or too plain; not this bad boy.  Imagine some insane minister of flavors, phenolics and esters (Mother Nature) is on her meds and they are actually working. What a delight! The only regret I have is that I drank it too soon, most likely. Maybe a repeat for 2012.

 

She Said...
- Carrie Kalscheuer

2011 was a year of domestic touring and tasting. I was out and about on the west side of our fair country like never before. Therefore, I'm going to focus on those wines that grabbed my attention not just because of what came out of the bottle, but also because of my personal experience with them and the steps that led to their production. Sorry, Italy. You know I love you. But this year belonged to the good 'ole U.S.A.

In House Pick: 2009 REX HILL Roserock Pinot Noir

I have the great fortune of working for one of my favorite wineries in the world. I can, and do, wax poetic about almost every bottle we produce. Narrowing my selection down to just one isn't something I can easily do, so to say that this bottle got my top pick is akin to a mother choosing a favorite of her children. It's just wrong. But this was the one wine we made this year that didn’t just make me wax poetic, but made me step back, take a deep breath, and be ever-so-grateful for my employee discount.

In the 'Hood: 2008 Evening Land Seven Springs Vineyard Pinot Noir

I’m not alone in thinking that Evening Land is doing some exciting things these days. Our friends down the road have gotten some excellent acclaim as of late – and for very good reason. Their 2008 Seven Springs is elegant, focused and fresh.

The World At Large: Schramsberg Blanc de Noirs

This was a very difficult choice. I've had a prodigious amount of fantastic wines this year (it’s a dirty job, but you know what they say…). Beating out the likes of Chappelet Cabernet Sauvignon, Darioush Viognier, Littorai Chardonnay and Failla Pinot Noir is no easy feat. Several factors contributed to my choice: the company with whom I opened the bottle, the hard-won accomplishments to which we toasted, and the perfect combination of yeasty, toasty, fine-moussed goodness that is Schramsberg's Blanc de Noirs. I want more. Now.

Time Posted: Dec 22, 2011 at 10:24 AM
REX HILL
 
December 7, 2011 | REX HILL

Our Top Ten Wish Lists for the Wine Industry in 2012

Another in a long line of Top 10′s. More like wishful thinking, we have compiled a list of the things we’d love to see for the next year. Maybe at the end of 2012, we will check back to see who has the prognosticator’s great gift. Onward…

He Said...
- Mike Willison

10. Backlash-lash: whether it be a backlash against un-oaked Chardonnay, weird-varietal-loving sommeliers, hating California Cabernet, or the 100-point scoring system, I predict that next year we see a backlash against the backlashers that will, hopefully, calm the frenzied fray a little. I’ll be hating the haters that hate so much that I'll achieve a furious inner peace.

9. QR codes: The buzz of interest surrounding QR codes for wine bottles and bottle shops will never beat into a boil, but rather fizzle away gradually like the slowly decreasing PR staff for Mariah Carey.

8. Txakoli is the new Ugg boots and shorts. Someone somewhere is still doing it, but you just don’t understand why, maybe you never really did.

7. Lunch Wine will emerge as a growing category for the industry. Slowly at first, but steadily the idea that a low alcohol gulper can make a cup of soup and a half sandwich a lot more interesting. People everywhere will become more successful and the economy will be improved. ½ bottle sales will skyrocket.

6. Pinot Gris has long suffered because of its very loud and relatively annoying Italian brother that has nothing particularly important to say. 2012 will be the year that Pinot Gris wins the "Cool New Guy" award at High School and everybody wonders where he's been all their lives even though he’s been there all along.

5. Americans figure out geography: If you’d like to learn about wine, you must first understand geography. We have figured this out and will soon be able to point out all kinds of interesting places on maps despite what Jay Leno would have you believe. As a result we become better international travelers and Canadian college kids start wearing USA flags on their backpacks.

4. Your mom stops giving you wine gadgets for Christmas: After this year you are putting your foot down. You do not require any more weird openers, coasters, shirts that say "me knows Pinots" on them, anything from the Sky Mall magazine, fruit wines from Michigan or the "neat wine made with chocolate." Enough already, egad.

3. Bloggers and pundits will still argue over whether social media drives sales. Maybe the question needs to be re-defined in terms of relevance. Does social media get more people talking about, thinking about, learning about and possibly drinking wine? Wouldn’t that then sell wine?

2. The 100-point system will not go away, but rather people will begin to see it for what it really is: a guide. When this happens, the people that score these wines will no longer wield the magic wand over the heads of the suffering dolts below. We will consider their selections and scores and then make an informed opinion based on our palate preference.

1. People will stop the ballyhoo about alcohol levels in wine. I prefer lower alcohol wines, but I also like to see what each vintage brings. Forcing alcohols down, or up, is an act of pandering, not one of terroir.

 

She Said...
- Carrie Kalscheuer

1. Bag-in-Box and Screwcap take over the world. As both consumers and producers alike grow tired of the thousands of gallons of wine lost to cork taint and oxidation, better (albeit admittedly less sexy) enclosures will start to take over, ensuring quality wine with every bottle – or, er…box as it may be.

2. North American wine regions will be recognized as more than "California." Texas, New Mexico, Arizona, and even Mexico have established up-and-coming, internationally acclaimed wine regions. Further, states with vastly different wine regions will become known for those on an individual basis, rather than lumping all of them together under "Oregon" or "New York."

3. The triumphant return of Merlot. Finally, the backlash caused by both my dad and Sideways calms down and consumers once again herald the release of single-varietal, not-overly-oaked, age-worthy Merlot from all over the world.

4. The individual palate will outweigh the 100-point score. People will stop putting all their eggs in the score basket and begin to trust their own taste buds. A good starting point, the score has gotten diluted, overblown, and uber-ubiquitous. (My current fave: a lovely, low-scoring 85-pointer.)

5. Chardonnay will become the Willamette Valley’s principal white grape. With such similar conditions to Burgundy’s incredible Chardonnay growing regions, it’s not so far off for me to hope for similarly-styled wines that fit both my palate and my pocketbook.

6. Sparkling wine will be …consumed like still wine, rather than saved for celebratory events. One of my favorite everyday pairings: potato chips and Champagne!

7. Classic wine paraphernalia enjoys a renaissance. No more bubbling aerators, motorized wine keys and pressurized stoppers. Decanters will once again be the belles of the ball, and everyone will own a Screwpull.

8. Wine will be served at the right temperature. There may be no better thing that the restaurant industry can do for the wine industry than actually present wines the way they were intended to be presented.

9. The United States decides to better regulate its wine industry. No more doling out AVA status to every Tom, Dick and Harry who just happen to have gotten first place in line at the TTB. "Reserve" will mean something more than just a heftier price tag, and California will actually have to make 100% Cabernet Sauvignon in order to label their wine Cabernet Sauvignon.

10. Mobile Websites for Wineries will help facilitate tasting experiences and wine purchases. Consumers will be able to make appointments on their way to the winery, download driving directions, and purchase bottles of wine with ease - all from their smart phones.

Time Posted: Dec 7, 2011 at 10:31 AM
Bill Hatcher
 
November 22, 2011 | Bill Hatcher

The Evolution of Industries

Industries tend to develop in four stages. While the particulars vary from industry to industry, there is nevertheless a common warp and weft on which the designs are woven.

The first stage is the birth of an idea or the knowledge phase.  It may be the natural progression of an existing technology such as the laptop computer, the mobile phone, Blu-Ray or digital photography. Or, it may simply be a better mousetrap requiring little or no technological leap like roller bags, quick release ski bindings, or parking garage systems that use LED lights above the parking spaces to tally the open spots in a row or on a floor.

The leap doesn’t have to be a manufactured product.  Overnight delivery, urgent care centers, multiplex cinemas, food courts and Southwest Airlines’ boarding system are all examples of low-tech or no-tech methods of better delivering a service.  It took until the 1960’s for someone to visualize the efficiency of a single queue at banks, government offices and ticket booths.

Some inventions create needs people didn’t know they had.  These too may be high-tech or low-tech.  Examples are the VCR, the answering machine, GPS navigation systems, truck bed liners or Post-it notes.

The knowledge phase typically doesn’t last very long, particularly in the digital age where information spans the globe overnight.  Ideas and products are readily pirated, tweaked and presented to the market as knock-offs.  Despite the enormous resources companies employ to protect trademarks and patents, the protections are porous.

Thus emerges the production phase as competing technologies sort out.  The VCR contest between Beta and VHS lasted for years, which is unusual; more common was Blu-ray supplanting conventional CD’s by dint of superior quality.  Cellular-based and satellite-based portable phone technologies waged a titanic battle for supremacy with cell becoming the U.S. standard and satellite the European standard.  The adoption of cellar technology in the U.S. despite the greater capacity of a satellite-based system demonstrates that the best technology doesn’t always win.  It also explains why we remain in the drunk tank on fossil fuels.

Technologies can win out only to be challenged anew later.  The PC dominated Apple with Microsoft’s relatively open architecture operating system, which permitted far more software applications to be developed for PC’s than for the tightly proprietary Apple operating system.  While PC’s still vastly predominate, Apple has developed its own applications around avant-garde products that have captured an increasing market share.

Typically, the production phase is also short-lived if only because product life is similarly so.  The marketing phase that emerges next usually endures longer because it is more asymmetrical.  Virtually identical products may be marketed entirely differently.  Current ads for the Volkswagen Passat are cast around wry humor while those for the Honda Civic tout history and engineering capability.  Those for Miller Lite beer mock the manhood of one of a group of friends with his beer choice (not Miller) being “the second unmanly thing you’ve done today.”  By comparison, Coors promotes a party atmosphere.

Beyond personality, the array of marketing elements taken together determines the lifespan of the product.  Which features will customers pay for and which are superfluous?  How are these features bundled?  Bundling that cannot be easily compared has become the fundamental selling strategy in industries such as computers and new cars.  How are products serviced or are they?  Most electronics are discardable because of obsolescence.

How and where products are sold can be a major determinate of success.  Beyond the innovative prowess of Apple, sleek freestanding stores in upscale shopping areas with ‘cool’ salespeople have complemented the products themselves.  By contrast, the web-based build-it-yourself approach of most PC makers can overwhelm the average buyer.  Schwan’s, originally a home delivery ice cream company in the 50’s, has sustained a niche long after home delivery went the way of telephone operators by capitalizing on small-refrigerated trucks to deliver a wide variety of frozen and refrigerated foods.

Products that survive the foregoing stand to become brands, the most enduring phase of the product life cycle.  Of the first three phases, knowledge and production, while critical to reach the marketing stage, are the least important to brand.  What makes a brand?   It is the quality of permanence in consumers’ minds.  Peanut butter, mayonnaise and tuna fish enjoy the greatest brand loyalty among grocery shoppers—of the two, it might be said that peanut butter was once innovative when the process for emulsifying the oil was discovered.  Otherwise, they exist as fixtures in the consumer’s minds; even discounts rarely spur brand switching.

The anomaly of the wine industry is that the knowledge phase lasted 10,000 years.  As recently as 20 years ago, the knowledge of winemaking was a sufficient competitive advantage unto itself.  Today, however, good wine is simply the ante to play poker and, at the risk of offending artistic sensibilities, wine is now a marketing driven business.  To the point of whether quality is still a differentiating factor, how many can remember a score from the Wine Spectator other than their own?

Bob Higgins, a founder of Highland Capital Partners in Boston, observed that when he invested in technology, he tended to lose money but when he invested in business models, he tended to make money.  Applied to the wine industry, all wineries worldwide employ roughly the same methods to make wine.  The successful ones persuade the consumer that they do something different.  Persuasion is marketing.

Time Posted: Nov 22, 2011 at 2:24 PM
REX HILL
 
November 8, 2011 | REX HILL

Big fish, small pool: why being the best wine isn’t always so hot.

He Said...
- Mike Willison

I very recently came across a bottle of wine that bore so many little gold medal icons on its label that it looked like that iconic photo of Mark Spitz after the 1972 Olympics without the moustache and spectacular bathing costume. My first impression was one of a kind of unknown reverence for achievement not unlike hearing that someone holds a doctorate degree, but in Phys. Ed., or Blacksmithery, and from an online university. "How impressive, I think. Wow, right?" I mean, should Pabst really still be peacocking about the blue ribbon they earned in 1893 at the World’s Columbian Exposition? A more deserving blue ribbon might go to you readers that knew that the event was held during the Grover Cleveland administration. Two blue ribbons if you can name his VP.

It seems that the modern day wine competition is a bit like modern day little league. True competition has been replaced by a kind of careless socialism wherein all of the best players stop caring because they aren't allowed to excel and thereby smite the egos of the less talented, and the worst players are all permitted to exist in a fantasy land wherein they are as excellent as Albert Pujols and get 11 strikes before they just get to go to first base. Ultimately, no one is keeping score and everyone either goes home a winner or, for the more cynical at heart, a loser. Double Gold, Gold, Silver, Bronze, Best of the Best, Outstanding, Exemplary, Notable, Neat-Looking, Explosively Mediocre, Fine; one can win a medal for just about everything at a wine contest, and usually does.

The question must also be asked, "Who was entered in this thing?" The answer usually is, "A bunch of people desperate for some kind of positive, marketable plaudits to sell to people impressed by sparkly things." Very rare is the competition that piques the interest of the best producers, like the Decanter World Wine Awards. More often than not the competitions are designed to draw in the locals, showcase smaller, folksy producers, and lure one of the regional showcase wineries into the competition to give it a bit of believability, thereby creating a viable, sustainable event for the sponsors and producers.

If, as a matter of coincidence, the winning wine happens to be one that you enjoy, thank the grower and winemaker, they did all of the hard work and make a wine you find appealing. Don't bother heaping praise on the judges of the competition, who are likely holding very impressive credentials in the field of wine-judgery, who I'm sure were cobbled together like a posse in the old west, or the wines at the competition: representing the best of what we could muster up.

 

She Said...
- Carrie Kalscheuer

I'm not in love with the idea of anything used solely for marketing purposes. There must be viability to the outcome in order for me to be on board as a rule. Any competition held exclusive of the so-called "best players" doesn't qualify, in my opinion. And that is often the case, as you mentioned. I, too, am frustrated by arbitrary gold medals and “best in show” awards. It’s all beginning to look like Little League these days where every kid gets an award just for showing up.  But you’ve only touched on the greater issue – that larger international competitions like the Decanter World Wine Awards – can make a significant difference not just in the marketing schemes of the individual winery, but in the wine world as a whole.

Consider what is now famously referred to as The Judgment of Paris: the 1976 Paris Wine Competition. Without this game-changing competition, American wine may not have achieved the status that it currently has, or this may have been at least delayed by many years. Already behind the game thanks to Prohibition, Napa’s win in this competition may very well have saved the industry as a whole. What it certainly did was pave the way for other wine regions around the country to succeed on a global scale.

Each wine region has their own story of glory on the competition front and, although none have achieved the status of the above example, that isn’t to say they have no merit, or at least the potential for merit. Again, it’s up to both wine professionals and more importantly, the consumer, to weed out the b.s. and not be swayed by a pretty blue ribbon tied around a bottle (or can as it may be).

Time Posted: Nov 8, 2011 at 10:35 AM
Bill Hatcher
 
October 22, 2011 | Bill Hatcher

What Business Are You In: Part II

With respect to the wine industry, the answers are widely divergent.  As recently as thirty years ago, such was not the case.  As late as 1980, winemaking knowledge was a competitive entry barrier in itself.  In Europe, that knowledge was largely passed down through generations.  In the 50’s and 60’s, Emile Peynaud, at the University of Bordeaux, pioneered the science of winemaking but traditionalists eschewed his methods.

In the U.S., the fledgling California industry of the 60’s and 70’s was more receptive to new ideas and turned to UC Davis to develop modern winemaking methods.  The resulting successes caused Europeans, particularly the French, to gradually adopt a more scientific approach to balance craft.  From there, formalized knowledge coalesced fairly quickly and by the mid-80’s, winemaking was no longer cabalistic.

Nevertheless, wineries persist on wine quality as their differentiating characteristic.  While the winemaker and her tasting group might distinguish subtle nuances, relatively few consumers can.  Rather, they rely on ratings to direct their palates.  Some years ago, the old Pacific Wine Company posted a series of irreverent cartoons skewering wine pretensions.  In one, a customer in a wine shop inveighs against a wine offered for tasting.  The shop owner intones that “Parker gave it a 99,” to which the customer rejoins, “I’ll take a case.”

Lost upon many wineries is that they are really in the luxury business.  At A to Z, while we promote Aristocratic Wines at Democratic Prices®, we have to constantly remind ourselves that for most wine consumers, $19 is an expensive bottle of wine.   Moreover, when a consumer enters a wine shop, he is confronted with hundreds, if not thousands of offerings.  Unable to distinguish the quality inside the bottle, his buying decision will ultimately consist of criteria outside the bottle—label, advertisement, prestige, anecdotal knowledge, a friend’s recommendation or a winery visit.

Once the luxury principle is accepted, the sales rationale can shift away from the simplistic (but nebulous) “because it’s better” claim better suited to a demonstrable can opener or a longer-lasting battery.  In recognizing that principle, the winery is correspondingly accepting that whatever one’s artistic sensibilities, wine like all consumer goods, is a market-driven business.  This realization can be freeing, leading one to examine what is truly unique about the wines and the winery.  And ultimately, uniqueness is the sine qua non of a luxury good.

Through the 90’s, producers primarily depended on fine wine wholesalers to sell and deliver their products to independent specialty shops where fine wines were generally sold. By one estimate, there were 3,000 wine wholesalers in the U.S. in 1990.  Some of these were giants dominated by brands such as Gallo.  Subsequent tiers offered a fit for wineries of every volume and price, down to boutiques producing a couple thousand cases.

In the past decade, however, the number of wine wholesalers in the U.S. has shrunk to around 500.  At the same time, distributors have moved away from selling to concentrate on logistics and fulfillment where technology allows them to manage without the major investment in people which selling requires.  Thus, it is increasingly incumbent upon wineries to undertake their own sales, which makes it all the more imperative to differentiate with marketing.

In the 80’s, wine touring, especially in California, began to attract consumers.  As it did, the business model shifted away from wine production for unknown consumers to a highly engaged one-on-one selling experience that brought wine education, entertainment and the stagecraft of the winery into the equation. Wine quality was simply the price of admission as sales became increasingly dependent on the ambient marketing appeal. Lured by the higher margins of bypassing wholesalers, droves of wineries chased the deceptively simple grail of direct sales, flooding the market and making it all the more obligatory to have a compellingly unique value proposition to attract customers.

Similarly, new trade laws opened many states to potentially lucrative direct shipping.  However, most wineries overlooked but quickly learned that these more liberal trade laws changed the competitive landscape for everyone and that to succeed, the winery had to bring the same unique value proposition to New York as at home.

The luxury principle can be supported in myriad ways.  In the case of A to Z, it is an affordable luxury.  Or, the appeal can be opulence as with wineries that more resemble palaces or, it can be an old barn that beckons to the authenticity of the land.  It can be an exclusive relationship with the winemaker or a wine club where events are lavish.  There are as many luxury opportunities as there are wineries but first, one must get out of the beverage business.

Time Posted: Oct 22, 2011 at 2:27 PM