Larry is absolutely right here. I’ve worked as a supplier in distribution for Santa Barbara wineries for most of the last 10 years, calling on national markets. Outside of SoCal, the Bay Area and the Central Coast, consumer and trade knowledge of Santa Barbara wine falls off dramatically. The region is typically rolled up in the consumer’s mind with greater Paso Robles if it gets any mindshare at all.
Many reasons for this, but in my observation the wine community in SBC at its core is often comprised of disparate parts and individual interests, often not operating in a common-good manner befitting success in other regions. That can be a strength that helps make the region unique but it’s also a weakness in building the region as a brand. Santa Barbara County government also is not great when it comes to the county’s wine industry. The SBCVA does what it can considerating the limited resources it has, but is underfunded relative to its competition.
With the difficult realities in wine of realizing profitability, a flat/declining category in wholesale, and a growing neo-prohibitionist movement in the public sphere, there’s an urgent need for Santa Barbara County (and elsewhere) to promote at a broader scale than it currently has the funding for if it’s to remain viable into the future.
This region historically has offered great value and experience for the world-class level of wines grown here. Granted I work ITB, but I’m also a consumer, and a small percantage (I think we’re talking about 1% here) for a BID doesn’t bother me here or in any of the other wine regions I care about if that helps sustain the region. Of course it’s not perfect, YMMV, and it has to be taken within the context of overall value and pricing otherwise.
I’d also argue that so much wine from small wineries gets sold in the wholesale market at a loss (highly-rated and high quality notwithstanding), that such marketing supporting better inventory management could support price stability and balance between aggressive price increases and aggressive discounting of closeouts.
Lastly, it’s unfortunate that this keeps surfacing here and is being pinned on Santa Barbara County, as it’s a broader topic.
It’s a principle thing. For those who work in the wine industry and love wine, it’s only natural to do everything you can to find creative ways to support the hard working people and smaller businesses in the industry. This is great, but I feel like one needs to consider how they would feel if this were applied to them as a consumer in other fields.
If all of the movie theaters in a city added a marketing charge to promote going to the theater, and all of the hotels in a city added a fee to promote tourism, and all of the coffee shops added a fee to promote (not just locally-owned) coffee shops, and grocery stores added a fee to promote cooking your own meals at home, and restaurants added a fee to promote the convenience of eating out…
Might it be better if AVAs could elect to require a % of sales (above a minimum) go to such an organization to stay current and use the AVA designations on labels? It’s a cost of doing business, and a business should have to consider if it’s worth budgeting for, not just pretend it’s all a consumer obligation.
It’s actually surprising that Sideways did not do more for our region than it did. Sure, more folks are familiar with our region than before, but not as much as one would believe.
And part of that fault lies within our region - as @Matt_Mauldin mentioned above, the splintered aspect means everyone one unison simply does not happen. And that puts us at a disadvantage to regions north of us especially that tend to be more about ‘we’ than ‘I’ . . .
(1) I’m in no position to say how much good it would do the region at what cost to pool money and advertise. I know advertising can work, and can not work, but I just have no feel for that.
(2) I think it would be better if the fee is paid by the wineries and they could reflect whatever way they can or need to in their pricing. I think more than a few customers seeing a surcharge for SBC wine advertising are going to have a negative reaction. Many won’t notice or care, but I think a significant portion will view that negatively. And that works against the whole point, marketing the region’s wineries.
Great points in general . . . But the problem with (2) will be that this will not be ‘mandatory’ and therefore many wineries willl choose not to do this, and that defeats the purpose of doing something that benefits an entire region.
On the other hand, if it passes, wineries will have the option of matching the fee in terms of a refund to the customer. In essence, that will ‘cost’ the winery double - but the customer will not be responsible and the region still benefits from ‘cooperative’ funding.
May I ask - why is it so easy to impose a mandatory fee, paid by the consumer through the winery, and so hard just to impose a mandatory fee for each winery? Is it because it’s the wineries who have to approve such a measure? (This is not meant to be rhetorical. I honestly don’t know).
The other problem I see with this structure is that it impacts the end pricing of wineries - at least from the buyer perspective - who are able to successfully sell their products more than others. Those are also the wineries who stand to benefit the least. They might already price where they want to, sell out their inventory, and have no inclination to increase production. Maybe this is why certain wineries don’t choose to participate (again - I have no visibility into this).
I might understand this in Temecula, where I suspect it’s more about wine tourism than winemaking. But we know it’s very possible to make excellent wines in Santa Barbara (yours included). You also do a great job engaging with customers (including on this board). Why isn’t it reasonable just to have expect businesses to rise or fall on their own merits?
Don’t get me wrong. I have friends in the industry and want everyone to succeed. But customers already support wineries by paying for the product. Is it really their job - and should they be compelled - to invest in the business or the region as a whole? That’s what investors are for - and they get something in exchange.
Not sure I understand, but unless we go thru this process, there is no way all wineries will ‘pay in’ to this - and therefore the chasm we already have in our region will grow even more.
And for those who are completely against this concept, I totally get it and understand why you would be in principal. No one wants to ‘pay more’ and not feel they are getting anything for this.
What I can say is that it will assist our region in creating a more competitive Association that will represent all wineries in our region; it will allow us to market our region better, and by doing so, ensure more eyes are on region as a whole.
Those of you who know me know how much a homer I am for this region - and how I ‘fight’ for wines from our region to be included in as many conversations as possible here and elsewhere on social media. Why? Why would ‘a winemaker’ do this? Because it has not, and is still not, happening at the rate that it should be based on the quality of the products we are producing.
Again, I will continue to understand those who oppose it - but please do understand where the concept is coming from - and it is not meant as a ‘money grab’ at all . . .
More great questions - and I know that this is not the ideal place to have these conversations but I’ll try my best (especially in the abscence of others in our area jumping in out of fear of repercussions or expressing an opinion instead of just asking a question).
First off, yep it’s the wineries who have to approve such a measure and that has proven to be a challenge in the past - something Temecula had zero problems in achieving in a timely manner. And since this will affect all wineries in our region, all of them have a say, regardless of whether they are currently members of the association or not.
Now the question has to be asked again - why would a winery choose not to be a member of their trade organization? There certainly are financial reasons for some, but many wineries who state this still take part in other tastings that ultimately cost them as much if not more to take part in . . . So there are other things at play here - and you will have to ask others who are not members why they are not.
It really is complicated - and yep, the quality of what we put out is stellar and more folks on this board and off should be familiar with it - and that’s what this will assist us with.
You keep hitting on the salient points for me, Larry. This is to benefit the wineries and the region vs the consumers, yet the consumers will directly foot the bill.
I think it would be straightforward to impose a mandatory fee structure on wineries without also requiring consumers to pay it. This would be called a “tax” and such taxes are decided upon at the city, county, state, etc. level. Santa Barbara could decide to create such a business tax using whatever decision making means they have at their disposal. Then they could funnel the funds from the tax to an organization that does the marketing, promotion etc. Wineries could decide whether to pass this tax along to consumers, or just bury it in their cost structure.
100% this. There is zero benefit to the customer. This is a ploy to extract more money out of customers and an attempt to convince wineries there will be no impact on their P&L. Resort fees is a great example. Just make the price the price, stop adding junk fees to it (BTW it would be comical if the federal junk fee regulations somehow blocked this).
So . . . When Paso passes this and Sonoma passes this, that will be your reason not to visit? I do believe MANY other regions will be considering and most likely passing this same BID concept shortly.
And I do believe this benefits consumers - by keeping us more competitive and relevant.
Larry,
You won’t be able to get past the inconsistent logic applied to the responses here. Many are fine with you charging more in your bottle price but will boycott you over a 50cent surcharge, which leads to the same price they were willing to pay for the bottle.
Also, it is lost on most folks that it has to be forced participation as some wineries won’t participate, which leads to fragmentation and infighting with nothing getting done.
Good luck. Get it passed and it will be in the rear view mirror.
I’m curious if this is a thing outside of California. Is there a bourbon trail fee or historic Charleston district fee that goes back in to building up the area ( or spent on bureaucracy and bloat as some have referenced here)
Unfortunately this concept is not new and is used frequently in other contexts. The best example is whats called a PIF - Public Improvement Fee. Economically it is a sales tax, but generally imposed on stores in a specific area and the funds go to whomever was allowed to impose the PIF (an improvement district etc). This comes in several flavors. And although its not legally a tax, it sure smells like one.