the price is... wrong!

Thursday, September 10, 2009

A recurring consumer complaint – I hear this over and over – is that Washington wines are overpriced. Rather than respond with yet another PG rant, I thought I’d bring in some other voices to comment.

Neil Monnens publishes the WineBlueBook (http://winebluebook.com) – a monthly listing of wines by score, price and category. In the current (September 2009) BlueBook he’s looking at West Coast cabernet sauvignon, among other categories. Monnens has this to say:

“This month's issue covers many West Coast Pinot Noir, West Coast Syrah, West Coast Chardonnay and West Coast Cabernet Sauvignon wines that were scored in the last 30 days by the wine critics. At the high scoring end, the 2006 Andrew Will, Cabernet Sauvignon Columbia Valley Sorella received an average score of 95 points and at $60 is 22% of the average cost of a similar scoring West Coast Cabernet Sauvignon earning it an "Outstanding Value" moniker.”

Let me point out that this is not unusual. Monnens frequently cites a Washington wine as the most outstanding value in any given month’s analysis. Other “Great Values” cited in the current issue are cabernets from Betz, Abeja, Buty, and Waterbrook. The only California cabs getting tagged as Great Value are Hundred Acre at $265 and Maddalena at $13. Full disclosure: many of the reviews that Monnens includes in his database are mine. Am I biased about Washington? You decide.

The Wine Exchange (http://winex.com) is an Orange County retailer with a big Web presence; they also still do a print mailer that I’ve gotten for years. I am not specifically endorsing this retailer, though I have purchased from them in the past. I want to share some of their comments from blog and mailer about the current state of denial in the wine industry – especially among California vintners. Some choice quotes:

“Q: What’s the wine market like these days?

Winex: Well, reality has set in a little bit more and there are a lot of opportunities for vultures like us, though there are still a surprising amount of folks in the industry that won’t acknowledge the situation. We used to have to work half the year to come up with deals that were screaming enough to be our feature ‘booms’ in the anniversary issue. Now it seems those kind of deals come up all the time...

Q: So the market is different than 2 years ago?

Winex: Of course. Anyone that says otherwise is probably not being honest, or has a really good pharmacist. The deal is that everyone wants to feel like they are getting a deal. Nobody wants $80 wine for $80. It’s simply amazing how many vintners want to ‘protect’ pricing. We had one guy, for example, offer us a Chardonnay for $12, but he wanted us to promise to sell it for $28! The wine industry’s own parochial nature is the only lingering problem.

Q: What do you mean?

Winex: The Information Age goes against the very fiber of the wine world. If you took a vote among the wholesale trade, Satan would finish ahead of winesearcher.com. Restaurants complain that retailers ruin their image (hint: we aren’t the ones charging 400% margins). We just got back from family winemakers and the 2007 vintage in California is truly sensational. But we don’t know who is going to buy all of the brand new $60 Pinots and $80 Cabs.”

On the Winex blog they go into more detail, again referencing the annual Family Winemakers event that was a recent showcase for the trade.

“Whenever we’ve attended this event the last few years it has been a litany of new producers trying to charge too much for their wares. It was literally painful going from new Cab guy to new Cab guy, tasting their wine, and then have them tell you it was $125 a bottle and they were going ‘exclusively mailing list only and perhaps a few restaurants they were going to hand-select.’ For every Mike Officer (Carlisle) we have found over the years there have been 20 other guys that didn’t have a clue. So we essentially fly up, spend hundreds of dollars, and leave with nothing more than memories of some pretty good $100+ Cabs and $60+ Pinots that will no longer exist in a few years because they should have been half that price. But this year, we thought, might be a bit different. Economy in the tank, global premium wine sales ground to a halt and the closure and/or continuing liquidation of a few wineries throughout the state might actually have some of the upstarts paying attention. This scenario, in conjunction with the outstanding 2007 harvest, would lead us to believe that there was some potential business to be done. We were actually a little pumped to check out the show.

Believe it or not, more of the same. More $60 Pinot Noirs, more $125 Cabernets, diamonds on the fingers, marketing plans culled directly from the Wine Advocate/Harlan school of wine sales. Lord, when will these people learn? It seems that no start-up wine producer wants to grow with their consumer, instead looking to hit ‘em directly in the pocketbook from the opening gun.”

Do Washington and Oregon have similar tales of excessive pricing? Yes, if you look hard enough. But not anything like what you see coming from California. Maybe Harlan can still sell all they make at $500 a bottle (current futures price). In Washington, you can still buy the best this state has to offer for a tenth of that (OK a quarter of that if you’re talking Quilceda). Personally, I’ll take four QC’s over a Harlan any day.

8 comments:

Wawineman said...

Here again is an example of a lack of advertising/marketing by Washington wineries. Say, if a group of "top tier" wineries would organize and have their ad budget matched by the Washington Wine Commission or the Institute, then display in the front pages of the big wine mags...I would think the "dam would break". Dream with me here--Andrew Will, Betz Family, DeLille Cellars, Mark Ryan, and Quilceda Creek on one page 'splaying their awards/ratings and, most importantly, price. That should drive up the buzz in the industry, right?

Also, while I'm stoked that the Wine Bloggers Conference is coming to Walla Walla next year, if a majority of the participants are from in-state, what the heck is the point? I hope the WBC comps admission to "recognized" wine writers that have advanced degrees to give it more "creed".

Anonymous said...

"I hope the WBC comps admission to "recognized" wine writers that have advanced degrees to give it more "creed".

do you mean "cred" as in "street cred"?

I doubt that "cred" trumps cold hard cash as far as the owner(s) is concerned. Just my take knowing the person/people involved. The fact is that anyone with a wine blog, no matter how obscure, is considered "Press" these days. So, in my opinion, "cred" and WBC can't possibly be used in the same sentence.

The fact that someone pays to attend something, and that this "something" attracts a fair number of people, does not in any way legitimize it. I recall a guy in the headlines recently that at one time was the head of Nasdaq, and had a firm managing billions of dollars, for thousands of people, but at the end of the day it was all smoke and mirrors. I think his name was Madoff.

People like to feel a part of something, understood. However, when the only criterion for admission is a paid entrance fee, it's hard to attribute any sense of legitimacy to the people involved.

I'm sure in the minds of all involved, it's legitimate. Especially in the mind(s) of those depositing the enrollment fees.

But I digress, and you're right, the WBC should do everything in it's power to legitimize itself; comps for "established", traditional wine writers seems a no-brainer.

PaulG said...

I have not attended the WBC in CA the past couple of years, but my impression is that the bloggers come from all over the country. A majority of bloggers from in-state? There just aren't that many bloggers in WA – maybe a dozen? that I know of. There are something like 250 attending this event. So simply for the exposure and educational value, I think it's a plus. I will withhold judgment on whether or not bloggers deserve to be given cred – my feeling is that you earn it, by posting something that's well-written, thoughtful, provocative even, five days a week. For a battle-scarred vet such as myself, it's an interesting challenge. Traditional cred doesn't count for much in the blogiverse; but I do believe that talent will still rise to the top.

Wawineman said...

My apologies for assumptions. I hope to attend the WBC10 just to see what a blogger looks like, besides my amateurish self.

Back to the article...is Washington State to continue this relative obscurity as a great winemaking region made up of Quilceda Creek, Leonetti, and CSM only? When will the powers that be change strategy and extoll the great wines of Washington, regardless of price? Or, do the majority of winemakers here generally like the obscurity?

Tiny said...

I THOUGHT THE RECURRING QUESTION WAS--ARE WASHINGTON WINES OVERPRICED? THE DREAM TEAM OF ANDREW WILL/ BETZ/ DEVILLE/ MARK RYAN AND Q CREEK-- LET'S SAY THEY ARE WASHINGTON'S BEST,THEY ARE PRICED FAR LESS THAN CALIFORNIA'S BEST AND EVEN SOME OF THEIR NOT SO BEST. BUT WHAT ABOUT THE OTHER 500 OR SO WINERIES THAT HAVE $40 AND $50 MERLOTS AND SYRAHS AT THE SAFEWAY IN WALLA WALLA AND YOKES IN TRI CITIES--I THINK THAT'S THE COMPLAINT--DON'T GET ME WRONG I'M A HUGE FAN OF WASHINGTON WINES AND I HAVE A HARD TIME FINDING BAD BOTTLE. THE UNDER $20. RANGE IS LACKING ESPECIALLY IN RED . THERE A FEW PEOPLE OUT THERE WITH OPTIONS, THAT "RIGHTOUS" KID IN WALLA WALLA IS ONE. I'M IN THE RESTAURANT BUSINESS AND I AGREE WITH MY CUSTOMERS, THAT $10-$14 DOLLARS FOR A GLASS OF WINE IS A BIT MUCH. I UNDERSTAND WHY IT'S HAPPENING--GOOD CALIFORNIA & GOOD WASHINGTON WINE IS MOVING BEYOND THE PRICE POINT WE NEED. THERE IS A VOID BEING FILLED WITH OTHER NEW WORLD WINERIES. I LOVE THE WASHINGTON WINE WORLD, I HOPE THE LEARNING CURVE ISN'T GOING TO BE TOO MUCH FOR SOME OF THESE GUYS.

Wawineman said...

When I fine dine, I look at perceived value, not just the actual price of a glass. I've enjoyed DeLille Cellars 'D2' at $20/glass a few times simply because it's a great wine with USDA Prime steak. I've also enjoyed a $3.99 bottle of Avery Lane NV Red Blend. There ARE Washington wines at every price point imaginable and are an excellent value. It also helps that I prefer to support the local economy. I've met the winemakers. I've mingled in the tasting rooms. These are my "neighbors." I guess a lot of diners do not understand that concept, so I'm a freak. Btw, thanks for the insight, Tiny.

Hey Mister G, just a curious thought...your outlook with bloggers--do you think that is the same type of "roadblock" that Washington wines face with the rest of the wine world? Let's blow this one up to scale by scandalously re-interpreting your words: "...I will withhold judgment on whether or not Washington wines deserve to be given cred - every big-named wine magazine's, wine critic's, and trendy restaurant's feeling is that you earn it, by making fabulous wines that are well-crafted, flavorful, vibe-driven even, with every vintage. ...Individual wines that are highly-rated, underpriced, and low-volume do not count for much in the great wine world; but I do believe Washington wines will still be around to debate its virtues."

I had fun with that one...now I can go to sleep.

Don said...

Problem is pure economics. When you produce only 1000 to 2000 cases per year and have 750,000 invested you cannot begin to pay the bills with 10 dollar a bottle wine. How many 5 dollar meals do you offer??

Tiny said...

DON--THE ECONOMIC CURVE ISN'T LOST ON ME. IF YOU SPENT $750,000 TO MAKE 2000 CASES OF WINE YOU ARE CORRECT. I REALIZE THINGS COST WHAT THEY COST, BUT IF EVERYBODY IS FOLLOWING THAT BUSINESS PLAN, THEN THERE IS A PROBLEM. I DON'T THINK ALL VALLEY WINE MAKERS ARE THAT TIED UP IN THE COST OF EQUIPMENT, ALLOT CUSTOM CRUSH AND SHARE EQUIPMENT, ESPECIALLY THE NEWER GUYS. WASHINGTON WINE MAKERS ARE FAR FROM THE HEADHUNTERS THAT EQUAL QUALITY HIGHER PRICED CALIFORNIA WINE MAKERS ARE. OF COURSE WE'RE ALL LOOKING FOR THAT $10 WINE, BUT THE REALITY IN MY MIND IS THAT THERE IS A GAP BETWEEN THE $10 BOTTLE AND THE $20-25 RANGE. I'M TALKING WHOLESALE PRICING , A FEW GUYS GET IT (CHARLES SMITH) IS ONE ,HE IS ALL OVER THAT PRICE POINT. AS FAR AS MY MENU WE HAVE A FEW THINGS IN THAT $5 RANGE .THE MENU GOES FROM $4 TO $29 WE HAVE 25 WINES BY THE GLASS--THEY'RE ALL $6.50 A GLASS. YOU SHOULD COME CHECK US OUT--BON APPETIT

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