Building a new brand/winery in Napa

WINE TALK
,
81

I got an email solicitation today that reminded me of a human thing…

I think a person can only ‘chase’ mailing lists so long, and if that person finally “snaps” and blows off one list, then watch out. All the others seem to suddenly become expendable and that reset can have a domino effect on all the other lists the person had been trying to keep up with.

Once someone has gone through that phase, it’s exponentially more difficult for the new pretty thing to set a hook.

I think we might be seeing this as a larger phenomenon amongst us winos. I’ve been getting offers like crazy from wineries that didn’t seem to care if I existed in the past: Anecdotally, I think there has been quite a softening in the ‘brand image’ category of lists. Some of my emails used to be a little threatening: “If you miss a release…blah blah blah,” and now they are “We’ve missed you, please come back.” (And, even though I am a great guy, I’m not getting those solicitations because I am a great guy.) :wink:

Once I fell off my first list, the second through tenth came to be like a giant light bulb going off: it had become a bit of a chore.

Example, and no need to change my mind, just my example of one: I had been on the Spottswoode list and done the Top Dogg memberships for years and years. I dated back on the list to, geez, pre-internet. I had joined the list by finding a bottle and discovering their phone number on their cork! It was pre-1991. It used to be simple: buy a case, get 20% off, repeat. Including the sauvignon blanc. A couple years ago, my annual email was “Must buy X bottles of one vintage to get any new vintage, no discount.” I called and was told I was new on the list and that’s what first timers got. I emailed and resigned from the list. Someone replied they had just gone to a new system and my old status was lost in the ether, the owner was CC’d and she nicely asked what she could do…but it hit me: I was now going to be paying $275+ per bottle and that sense of relationship that people mentioned on another thread was gone. I also realize I am but a snail crawling along the edge of a straight razor, but it did feel like the world had changed, not for the better.

So, anyway, I think we entering an age of list fatigue, and premium lists really need to do things like Chris mentioned: creating a SOLID sense of belonging to something will be a big part of your brand building efforts.

18 Likes
82

I think this is a good point, but to each their own. I can see choosing somewhere else that would take less investment, but if Napa is what you love (and know) then Napa makes sense. Even with the extreme pricing of the region and other challenges, if you know the Napa region intimately already then you will have a big advantage over going to another area.

3 Likes
83

You guys remember this one?

If you are trying to build a brand/winery in Napa, don’t do this.

4 Likes
84

I think that’s really one of the main reasons we still interact via email and telephone for orders (instead of having a cart on the website). Not just to show people that they are very much a part of helping our winery exist, but to keep us connected with the people who are supporting us. Seeing how much support we get from the mailing list really makes me appreciate everyone very much.

16 Likes
85

100%

86

I remember! That was a good one.

Is it ongoingly viable?

87

I have no idea about the business but those bottles live in infamy!

88

That Perrarus looks like something The Todd (not to be confused with Todd) would have come up with. Amazing.

2 Likes
89

I know this topic gets beat to death here but I always enjoy these threads when you can get perspective from someone on the business side of things.

@Hayes_Drumwright not sure if you’ve followed all these threads recently but there was a comment in one that said something along the lines of “we could launch this one at $150 and be fine economically but we want the prestige of being on the $200+ club.” I agree there is some consumer mindset of paying a premium for a perceived higher quality product but with the flood of Napa in that $200+ range now it just seems untenable.

It seems wineries that used to have long waitlists or would sell out every year are now reaching back out to consumers with second and third chances to buy. I know you said you can’t drop the price but it just feels like the market forces leave few other options at this point. At some point if you don’t drop the price you aren’t going to sell enough and do you just close the doors before you even try dropping the price?

5 Likes
90

It’s interesting what @Hayes_Drumwright has contributed and I appreciate that he took the time to repeatedly post. Many of the counter responses also resonate with me. To get at what may lie at the bottom of this dispute, it occurs to me that there actually are market movers on WB–largely, though not wholly, when it comes to areas other than Napa: like Burgundy or Bordeaux or the Rhone. I’m certainly not one, but most board members will know whom I’m talking about, In these case, however, of a Juge or a Magdelaine and or BAMA and so on, people are posting about wines that are highly singular; they stand out for having qualities rarely found in their peers. (It may be no accident that the first two I have mentioned no longer are in production.) I wonder, then, whether the marketing and branding in Napa is so necessary, because, with very few exceptions–MacDonald comes to mind–at the end of the day the differences are not as significant as in other wine regions? They can be good, a real pleasure, but they seem to go to toward the same “ideal,” not to vary as much as for example styles across Burgundy–Dujac, Fourrier, Roumier–or in these other instances. (Think also of high end bordeaux–nothing tastes like Cheval Blanc, or really Haut Brion , or Margaux.) Of course, they are a little different and I may just not be attuned to the nuances as I am with other wines. But I still think at bottom there is a unifotmity of what’s expected and produced even at the higher/highest ends–i’ve tasted most but don’t buy >$250 and usually less–that is different from the other leading regions and also explains why the marketing and so on is so essential. Go ahead, tell me why I am wrong.

3 Likes
91

I think it is tough. I don’t know anyone doing it for prestige. It is a cool business to be in, but it doesn’t make any money at all compared to a good business. Just from the time necessary to deliver the product, it is no good. You have to just want to make something spectacular to share with friends and loved ones. Once you start to gather a following and people want the wine, it can get more fun, but you are always a bad harvest away from cash flow trouble.

That said, I am not sure what these wineries that are struggling to sell wine (at whatever price they deemed correct) are gonna do. Many can’t sell the wine. And even something as simple as lunch or dinner out with the family seems like it has doubled in price in the last 4 years. How the wineries deal with increased costs yet a consumer that has options everywhere for wines online and deals from people dumping inventory…I don’t know. I think it is the definition of a correction. Most projects I know of have investors. And the investors will stop putting money in at some point. I expect many wineries will sell or fold unless the market comes back quickly hence the emails you all have been getting asking you to come back. It sucks, but that is how business works. Expect the bigs to seize to opportunity of buying wineries and consolidation to occur. Expect the small guys that had a dream to struggle.

And expect those people that came to Napa 10-15 years ago and run the winery like a business with a focus on making insane wine, factor in supply and demand, customer intimacy, price elasticity, building a strong team, story, and experience for their clients…expect them to thrive. Not everyone in Napa is struggling. I think many brands are on the rise. And they will be the brands of the next 40-100 years hopefully. I am saddened by all sales, but there is opportunities in everything.

3 Likes
92

Ding ding ding. This is where I’m at. It sucked to finally drop Spottswoode myself. I think it’s the best wine in Napa but it was time to stop chasing the increased bottle costs. I’ve got enough Spottswoode to drink for a good while.

1 Like
93

[quote=“Anton_D, post:81, topic:327781, full:true”]A couple years ago, my annual email was “Must buy X bottles of one vintage to get any new vintage, no discount.” I called and was told I was new on the list and that’s what first timers got. I emailed and resigned from the list. Someone replied they had just gone to a new system and my old status was lost in the ether, the owner was CC’d and she nicely asked what she could do…but it hit me: I was now going to be paying $275+ per bottle and that sense of relationship that people mentioned on another thread was gone.
[/quote]

Id call that good relationship management on the owners part making up for a technical mistake… or did you mean the price killed it for you?

94

I think we need to accept that wineries will raise prices to market rates over time. In fact, I prefer they do that, you can go back later for more bottles without fighting flippers if you particularly enjoy a vintage. And you know profits are going to the winery. The biggest thing I’m looking for is consistency. I am buying your wines for a reason. Don’t mess with the formula, don’t get lazy. The reason I’ve been buying VHR, Spottswoode, Freemark Abbey, etc. for years is that I know what I’m getting. The style doesn’t change and the execution is at an extremely high level, even across winemaker changes, weather variations, and so on. This is very hard to do but for the price charged I expect it.

2 Likes
95

Whats the Freemark Abbey style?

96

It’s like the Mark Abbey style, but way cheaper.

6 Likes
97

Sappy dark fruit, refined tannin, never over-ripe but done in a way that drinks well young and old. Obviously a super old-school name in the industry but they aren’t defined by old-school winemaking, nor do they chase trends. Just a top-notch operation.

1 Like
98

Mr. Drumwright,

I appreciate your posts and this thread in general.

In light of what you wrote above, please permit me to ask again why this brand / these brands are being established in Napa?
The Santa Cruz Mountains and Paso Robles now have long track records (in the case of the Santa Cruz Mountains, about as long as Napa!) for producing Cabernet Sauvignon at the very highest level. I could also include certain vineyard areas in Washington State on the list.

Thank you.

1 Like
99

You are my soulmate.

1 Like
100

A growing bit of dark humor here, but we obviously don’t want to cross pollinate ( or is it pollute) two threads. We currently have another thread going on oversupply along side of a drop in demand for wine/grapes. Here we have discussions on new vineyards, new brands, and more $200+ cabs. :thinking: In the Barolo area of Piedmont, if you want to plant more Nebbiolo, you must first tear the same amount out elsewhere within the area. I wonder whose Napa vineyards , producing these $200+ wines, they want to tear out to make more in SBC or Santa Cruz Mtn? As currently demonstrated, the demand for such isn’t unlimited. Build It and They Will Come isn’t working so well right now!
:roll_eyes:

1 Like