World Wine Crisis Series (Ten): "$100 bottles of wine gather dust." - Michael Whiteman / "US wineries must adjust to new $50 ceiling" -- Decanter

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CONSULTANTS PREDICT 13 RESTAURANT AND HOTEL FOOD AND DINING TRENDS FOR 2010

(Click on link above to read the whole report.)

". . .$100 bottles of wine gather dust." -- Michael Whiteman, 
President Joseph Baum &Michael Whiteman, Co, Inc.,  
International Restaurant Consultants http://www.baumwhiteman.com/

  Michael Whiteman cutting through the bull in Barcelona.  
At Hotel Arts, for whose original restaurants the Joseph Baum & Michael Whiteman, Co. was the consultant.
Photograph by Gerry Dawes©2006.
 

"#3 UPSCALING THE DOWNSCALE: No question that consumers are trading down.  Steakhouse sales slipped 25%-30% since last year, and $100 bottles of wine gather dust. Predictably, hamburger and hot dog sales are on the rise but not because they’re cheap. What’s important is that consumers are using these vehicles as trade-up treats! That’s what’s behind the explosion of “gourmet” hamburgers smothered in the likes of manchego cheese and Iberian ham; or fanciful hot dogs served with goat cheese and guacamole; or french fries revved up with parmesan cheese and truffle oil.  

Consumers are trading down in order to trade up! That explains why operators are success -fully playing one-upmanship with these items, why they’re labeling them like categories of steak: brisket burgers, short rib burgers, grass-fed burgers. It’s why lamb burgers, which you couldn’t give away three years ago, are selling. It’s why you find hand-made artisan hot dogs and Kobe dogs smothered in home-made relishes and condiments (Show Dogs, San Francisco; Bark, Brooklyn; Hot Doug’s, Chicago).
 
Danger: At low price points, there’s little economic risk in experimenting; but when people finally have more money in their pockets, will they forsake these humble things and rush back to steaks and chops?"

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US wineries must adjust to new $50 ceiling: report

November 24, 2009
Richard Woodard, Decanter Magazine

The era of the US$100-plus bottle may be over as the US recession takes its toll on Baby Boomers' wealth, according to a new report.

In the preliminary findings for its 2010-11 Annual State of the Wine Industry Report, Silicon Valley Bank warned that wineries need to adjust to a 'new normal' of reduced spending power – among the very consumers who have driven recent growth in the market.

'For that segment of Baby Boomers who have seen their net worth drastically reduced and who have been the prime target of wine marketing for nearly 20 years, a US$50 bottle of wine is now permanently out of the question for a normal purchase,' said Rob McMillan, report author and founder of the bank's Wine Division.   (Click on link above to read the whole article.)
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About Gerry Dawes

Gerry Dawes's Spain: An Insider's Guide to Spanish Food, Wine, Culture and Travel


Gerry Dawes was awarded Spain's prestigious Premio Nacional de Gastronomía (National Gastronomy Award) in 2003. He writes and speaks frequently on Spanish wine and gastronomy and leads gastronomy, wine and cultural tours to Spain. He was a finalist for the 2001 James Beard Foundation's Journalism Award for Best Magazine Writing on Wine, won The Cava Institute's First Prize for Journalism for his article on cava in 2004, was awarded the CineGourLand “Cinéfilos y Gourmets” (Cinephiles & Gourmets) prize in 2009 in Getxo (Vizcaya) and received the 2009 Association of Food Journalists Second Prize for Best Food Feature in a Magazine for his Food Arts article, a retrospective piece about Catalan star chef, Ferran Adrià.

In December, 2009, Dawes was awarded the Food Arts Silver Spoon Award in a profile written by José Andrés.

". . .That we were the first to introduce American readers to Ferran Adrià in 1997 and have ever since continued to bring you a blow-by-blow narrative of Spain's riveting ferment is chiefly due to our Spanish correspondent, Gerry "Mr. Spain" Dawes, the messianic wine and food journalist raised in Southern Illinois and possessor of a self-accumulated doctorate in the Spanish table. Gerry once again brings us up to the very minute. . ." - - Michael & Ariane Batterberry, Editor-in-Chief/Publisher and Founding Editor/Publisher, Food Arts, October 2009. 

Mr. Dawes is currently working on a reality television series
on wine, gastronomy, culture and travel in Spain.

Experience Spain With Gerry Dawes: Customized Culinary, Wine & Cultural Trips to Spain; Travel Consulting on Spain

Gerry Dawes can be reached at gerrydawes@aol.com; Alternate e-mail (use only if your e-mail to AOL is rejected): gerrydawes@gmail.com

World Wine Crisis Report (Eight): From Wineaccess.com "Understanding the Crisis in Napa: Part 1"

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(Although this is a pitch by wineaccess.com, an internet wine marketing company, to sell some fledgling Napa estate wines, this article has some good, pertinent information on  the roots of the wine crisis in Napa Valley.)

(All side commentary, red-lining & photos copyright 2009 by Gerry Dawes.)

 

Understanding the Crisis in Napa: Part 1
 

It's impossible to deny the appeal of the Napa Valley. Close to six million wine drinkers work their way up Route 29 each year, hopping from one glittery tasting room to the next. That flow of traffic -- generating massive direct-sale opportunities -- coupled with a worldwide love affair with high-end, highly scored boutique brands, fueled unprecedented price escalation in Napa.

Few of the boutique Napa Valley wineries grow grapes. Most buy fruit. As bottle prices escalated, particularly in direct sales, margins exploded. Suddenly, grape growers of the most coveted vineyards could pick their customers. Grape prices soared, and growers were able to lock in their clients to long-term grape contracts. Those contracts are part of the root of the crisis.

But for the purposes of this portion of the story, we've chosen to focus on a different part of the market: the fairly new, estate-bottled wineries. These estates, many as small as 10 acres, spent lots on land, then spent much more ripping up the land and planting. Some began by simply growing and selling grapes before bottling wine on their own. Some went directly into bottling under their own brand. They built business models (most of which have turned out to be Excel Spreadsheet Fiction) based on what was going on up and down the Silverado Trail. They spent fortunes on French barrels (as the dollar dropped precipitously), hired consulting winemakers, and prepared for the gravy train. 

 Silverado Trail, Napa Valley. Photo by Gerry Dawes©2009.

To really taste the crisis, we've created a sampler made up of three of the most inspired releases from these new, small estates. There's Tim Milos's brilliantly rich and elegant Rubissow Cabernet Sauvignon from Mount Veeder, the Crane Brothers' "perfect blend" (the best of the best from this pristine vineyard) called Brodatious, and the delicious, opulent Maple Lane Cabernet from their vineyard between St. Helena and Calistoga. Two bottles each of these tiny-production Napa gems, sold for less than 50 cents on the dollar! Here's why.

Almost uniformly, the wineries above, and dozens of others up and down the valley, were faced with a stark new reality. Just as the winegrowers were ready to launch their brands, the wholesalers clammed up. $50 bottles that had been flying out of wholesale warehouses backed up. Rather than taking on new suppliers, wholesalers were cajoling existing suppliers, explaining how the market was on its ear, why prices had to come down. For the new guys on the block, the wholesale market fell apart in just a few months at the tail end of 2008.

 

Less stretch limos in Napa Valley these days. Photo by Gerry Dawes©2009.

As to direct sales, traffic slowed on Route 29. Other wineries with more mature programs stepped up their direct-marketing budgets. These new wineries weren't positioned for the direct game; their mailing lists were small, their direct-marketing prowess immature. The phones that would have been ringing off the hook 18 months before were silent. Wine was backing up in the warehouse and grapes -- well, grapes just keep growing, year after year.

What will happen to these businesses? Some will close. But the family-owned and -operated businesses will scramble, figure out how to survive. The vineyards are excellent, the wine is already very good and as the vines mature, it too could be excellent. They tighten their belts, and they look for ways to get wine-sophisticated consumers to taste their wine. Many now are contacting WineAccess. --wineaccess.com

Dr. Wilkinson's Hot Springs Mud Baths, Calistoga, Napa Valley.

(A lot of wineries around the world may have to open wine spas, because somebody is going to take a bath in all the unsold.  I have an idea; they should rachet up the alcohol even further, so they can offer hot springs wine baths.  We know there is a worldwide wine crisis, but does anyone see a connection between dropping consumer demand and high prices, wine made with a load of high-priced French oak as a flavoring agent and alcohol levels so high that the wines can be used to flambeé a dish and are practically guaranteed to turn off women and people with a sensible palate?  Text & photo by Gerry Dawes©2009.)

About Gerry Dawes

Gerry Dawes was awarded Spain's prestigious Premio Nacional de Gastronomía (National Gastronomy Award) in 2003. He writes and speaks frequently on Spanish wine and gastronomy and leads gastronomy, wine and cultural tours to Spain. He was a finalist for the 2001 James Beard Foundation's Journalism Award for Best Magazine Writing on Wine, won The Cava Institute's First Prize for Journalism for his article on cava in 2004, was awarded the CineGourLand “Cinéfilos y Gourmets” (Cinephiles & Gourmets) prize in 2009 in Getxo (Vizcaya) and received the 2009 Association of Food Journalists Second Prize for Best Food Feature in a Magazine for his Food Arts article, a retrospective piece about Catalan star chef, Ferran Adrià.

". . .That we were the first to introduce American readers to Ferran Adrià in 1997 and have ever since continued to bring you a blow-by-blow narrative of Spain's riveting ferment is chiefly due to our Spanish correspondent, Gerry "Mr. Spain" Dawes, the messianic wine and food journalist raised in Southern Illinois and possessor of a self-accumulated doctorate in the Spanish table. Gerry once again brings us up to the very minute. . ." - - Michael & Ariane Batterberry, Editor-in-Chief/Publisher and Founding Editor/Publisher, Food Arts, October 2009.

Mr. Dawes is currently working on a reality television

series on wine, gastronomy, culture and travel in Spain.

Experience Spain With Gerry Dawes: Culinary Trips to Spain & Travel Consulting on Spain

Gerry Dawes can be reached at gerrydawes@aol.com; Alternate e-mail (use only if your e-mail to AOL is rejected): gerrydawes@gmail.com

World Wine Crisis Part Three Reply: David Schildknecht's Observations on a Post on Jaime Goode's Blog

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From: David Schildknecht

To: Gerry Dawes
Sent: Tue, Nov 10, 2009 12:35 pm
Subject: Re: Jaime Goode on the Future of Wine

See World Wine Crisis Part Three on Gerry Dawes's Spain

Thanks for making me aware of what Jamie wrote on this topic, Gerry. I think I'll drop him a line (or rather, the following lines) about it.

“I don't think the future of the wine industry will be determined top-down by the famous people who currently 'lead' the wine industry. Instead, I think it will come from an under-the-radar movement of dedicated winegrowers who are prepared to understand the vineyards they work with and make interesting, authentic, characterful wines ... not because they want to make money, but because they have to. These new great wines are made by people who see winegrowing as their vocation. Their focus starts in the vineyard and they work as naturally as possible. Typically, they prefer large oak to small, old oak to new, and concrete to stainless steel.” - - Jamie Goode's Wine Blog.

David Schildknecht (a personal message):

Many, perhaps most of the important changes in the wine industry come down to individual growers, but I doubt in predictable ways. Furthermore, today's "under-the-radar" vintner is tomorrow's superstar. In the 21st Century, insider secrets or tips can only stay that way if the grower's circle of customers (whether private or trade) is determined to keep the secret and succeeds. And in that case, by definition, waves aren't being made in the entire industry.

Whenever somebody poses this sort of (in my estimation) false vinous dilemma - and it happens continuously - I try to consider some actual cases. Take the following example from Germany.

Helmut Dönnhoff was under even the German radar in the 1970s and began to attract a German following in the 1980s. The 1988s were still sold 90% to private customers, with 1989 being the first vintage when a significant amount of wine traveled abroad (to the U.S.). Helmut's devotion was to a dream of fidelity to the Middle Nahe's great vineyards, and to the vision of wine and the traditions of an earlier generation, whose members were his mentors. His international reputation built steadily over the past 20 years, but that ascent was inseparable from and unthinkable without the contemporaneous renaissance of interest in Riesling within German, or without the fact that Helmut cultivated a continuous tradition with dry wines, which from the 1980s on constituted the only sort that any self-respecting German would be caught drinking.

Erni Loosen staged a coup at his father's commercially ailing but still internationally-known winery in 1987 and had to figure out how to prop up a collapsing market for the wines from an enormous domaine. He immediately started making headlines and showing his face abroad, which is where the market for residually sweet Mosel wine then resided - there was practically no market in Germany for Rieslings of that sort, and there still is little. Erni proved himself to be a consumate back-slapper and promoter as well as a savvy businessman; a conspicuous leader of a worldwide revival in Mosel Riesling's reputation; and eventually a flying winemaker and conference organizer who has helped to put Washington State on the world's wine map. Along the way, he also learned to craft dry Mosel Riesling according to the demands of the German market and to models influenced from abroad (especially Austria).

You could hardly pick more dramatic contrasts of commercially-driven versus tradition-driven; of being a spokesperson for one's wines versus letting one's wines speak for one; of crafting wines to fit a style versus letting a style emerge out of the conscientious plying of one's craft; of top-down management of a business versus solely managing the vines and letting the rest take care of itself. Yet, at the end of the day, nobody is going to deny that these are two of Germany's top Riesling producers and two of the wine world's super-stars.

Helmut is never going to have the kind of commercial influence an Erni Loosen does, because Helmut's not wired for the p.r. and conference-attending (much less -organizing) role. He is a star despite himself. Still, I never imagined I'd witness him holding court internationally as he has (including at Loosen's and Ste-Michelle's Washington conference). Erni for his part is never going to have the profound influence on other growers of a Dönnhoff, because the talents exhibited in Loosen wines aren't quite on the same order of magnitude and, more importantly, those talents don't reside in a single person (partner Bernard Schug is as much responsible). Does one of these figures or types represent the future of wine and the other not? I really doubt that.

You could compare Draper with Mondavi; Gaja or Rivetti with Giacosa or Bartola Moscarello; Henri Jayer with Bize-Leroy; F. X. Pichler with Leo Alzinger; Kracher with Szepsy; Chave (Sr.) with Chapoutier; Wilhem Haag with Willi Schaefer ... . From today's global perspective, they're all stars, and they will all go down in the history of late 20th wine growing as among the individuals most influential on the perception and practice of viticulture and wine. Depending on the observer's own personality, he or she probably gravitates or is more sympathetic toward one or the other of these extreme types, whether in the search for wine to put on the table or for personal heroes to enshrine in the imagination. But puffing-up personal preferences into purported sea changes or waves of the future is a stale and tiresome art.

I'll leave you with one more thought, prompted by a correspondence I had last week (during a cold snap and break in his harvest) with Klaus-Peter Keller. The subject was selectivity versus block picking and their relationship to evolving wine styles, which led him to write this:

"When my father made his first wines in the '80s and '90s, he had to impress people with his wines, because nobody knew us [or believed in the potential of the Wonnegau region]. That's why they were concentrated and massive [dick]; thinned and selectively harvested like crazy [toll im Weinberg vor- und ausgelesen] but for that reason also (according to my current taste) a bit affected [aufgesetzt]: interplay [Spiel] and elegance were missing. Nevertheless, that phase was critical for our business [Betrieb]. Then too, it's important to be open to criticism - and in that respect you helped us during those times as well (when your not coming to visit got me to thinking). And in the meantime we can afford to make our wines exactly the way we want to."

Sometimes, in other words, both the grower and his wines might have to get up on a soapbox and speak a bit loudly, self-importantly, and with slogans to get market attention so that the next generation can unplug the amps, [try to] tune out the stardom, and "simply" grow the best possible wine. But I don't need to offer you examples of the countless occasions when things work out the other way around: when one generation labors a lifetime to quietly build a great wine reputation but the style of the next generation is to turn that into an internationally successful brand with an amplified band.

Stars of all sorts will be with us always, but I wouldn't try reading the future in them.

David Schildknecht



Gerry Dawes's Spain: An Insider's Guide to Spanish Food, Wine, Culture and Travel

Gerry Dawes was awarded Spain's prestigious Premio Nacional de Gastronomía (National Gastronomy Award) in 2003. He writes and speaks frequently on Spanish wine and gastronomy and leads gastronomy, wine and cultural tours to Spain. He was a finalist for the 2001 James Beard Foundation's Journalism Award for Best Magazine Writing on Wine, won The Cava Institute's First Prize for Journalism for his article on cava in 2004, was awarded the CineGourLand “Cinéfilos y Gourmets” (Cinephiles & Gourmets) prize in 2009 in Getxo (Vizcaya) and received the 2009 Association of Food Journalists Second Prize for Best Food Feature in a Magazine for his Food Arts article, a retrospective piece about Catalan star chef, Ferran Adrià.

". . .That we were the first to introduce American readers to Ferran Adrià in 1997 and have ever since continued to bring you a blow-by-blow narrative of Spain's riveting ferment is chiefly due to our Spanish correspondent, Gerry "Mr. Spain" Dawes, the messianic wine and food journalist raised in Southern Illinois and possessor of a self-accumulated doctorate in the Spanish table. Gerry once again brings us up to the very minute. . ." - - Michael & Ariane Batterberry, Editor-in-Chief/Publisher and Founding Editor/Publisher, Food Arts, October 2009.

Mr. Dawes is currently working on a reality television

series on wine, gastronomy, culture and travel in Spain.

Experience Spain With Gerry Dawes: Culinary Trips to Spain & Travel Consulting on Spain

Gerry Dawes can be reached at gerrydawes@aol.com; Alternate e-mail (use only if your e-mail to AOL is rejected): gerrydawes@gmail.com

World Wine Crisis (Four): Articles in This Continuing Series La Rioja

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Las ventas del vino de Rioja caen un 17% en Septiembre - Mercados del Vino y de la Distribución 10 Nov. 2009

Sales of Rioja wines down 17% in September, 21% in the Spanish national market; exports down 11% for the year.



About Gerry Dawe

Gerry Dawes was awarded Spain's prestigious Premio Nacional de Gastronomía (National Gastronomy Award) in 2003. He writes and speaks frequently on Spanish wine and gastronomy and leads gastronomy, wine and cultural tours to Spain. He was a finalist for the 2001 James Beard Foundation's Journalism Award for Best Magazine Writing on Wine, won The Cava Institute's First Prize for Journalism for his article on cava in 2004, was awarded the CineGourLand prize in 2009 and received the Association of Food Journalists 2009 Second Prize for Best Food Feature in a Magazine for his Food Arts article, a retrospective piece about Catalan star chef, Ferran Adrià.

Mr. Dawes is currently working on a reality television

series on wine, gastronomy, culture and travel in Spain.

Experience Spain With Gerry Dawes: Culinary Trips to Spain & Travel Consulting on Spain

Gerry Dawes can be reached at gerrydawes@aol.com; Alternate e-mail (use only if your e-mail to AOL is rejected): gerrydawes@gmail.com