XChateau Wine Podcast

Latest Episodes:

Marketing to Millennials w/ Damien Wilson, Sonoma State University Jul 07, 2021

Show notes

Part two of our interview with Damien Wilson, Hamel Family Chair of Wine Business at Sonoma State University, focuses on what wineries can do to align their brand, marketing messages, and how they sell wine to Millennials. From hospitality to various marketing channels, with social media, Damien provides examples of what works and tips on what to do. This episode also includes a “lightning round” where Damien and Peter discuss some of the major trends in wine marketing.

Detailed Show Notes:

Millennial Wine Buying - tips for wineries
- Limits on brand loyalty/retention mean wineries need to make more customer acquisition
- High price points will put off younger consumers
- Low-end wine brands (e.g., Charles Shaw) are not targeting Millennials well - they appear to be more about consumption (e.g., Carlo Rossi jug wine, Bag in a Box brand) vs. Millennial values
- Seltzer likely hitting a peak as the category is starting to fracture and fragment with many new brands and brand extensions
Hospitality best practices
- We need to be better at the digital era
- Wine industry good at talking about the product and quality (e.g., winemaking, terroir, product characteristics) but needs to know how to get people to the glass before what’s in the glass
- Responses from wineries on social media are very slow or unresponsive
  - Good examples
    - Jason Haas of Tablas Creek in Paso Robles - very responsive, got back to Damien in 10 minutes of tagging, Jason responds himself
    - Nicole Rolet of Chene Bleu
    - Randall Graham - remains relevant but admits to not figuring out how to make money from social media
    - Macrostie - has 12 different locations in their facility with different experiences - creates a reason for people to come back
  - Tagged 27 wineries on a trip to Paso Robles, and only 2 got back to him (1 of which was Tablas Creek)
  - Automated monitoring can help - so people get notified when activity occurs
Millennials have a strong attachment to people behind the brands and ones that reflect their values
Millennials ask questions, and they will tell you what they like
Marketing channels that work
- Social media
- Retail with smaller producers/experiences (e.g., Whole Foods showcases smaller producers and is more experiential shopping)
Marketing Lightning Round w/ Damien and Peter
- Augmented Reality - “brilliant” according to Damien, cost of adoption is falling, e.g., 19 Crimes and Snoop Dog Rose
- Natural / “Clean” wines - a way to premiumize lower-end wines with marketing; natural wine suffers from lack of consistency, making it harder to adopt; Clean wines - unsure if success is related to clean or celebrities that back them
- Low/No Alcohol / No sugar wines - could work if they get people into the wine category, likely more a niche long-term
- Celebrity wines - will likely grow but needs to be authentic - e.g., Kim Kardashian was behind a vodka brand but didn’t drink, which turned people off of the brand

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Millennials & Wine w/ Damien Wilson, Sonoma State University Jun 30, 2021

Show notes

With values and attitudes formed around the turn of the 21st century, Millennials want fulfilling careers, are more into environmental and social causes, and grew up in the social media era. Damien Wilson, Hamel Family Chair of Wine Business at Sonoma State University, explains who Millennials are, what drives their buying habits, and the brand loyalty of the group. This is the first part of a two-part series on marketing to Millennials.

Detailed Show Notes:

Damien’s background
- Mid 1980’s - worked in grocery retail in wine & spirits
- Early 1990’s - worked in hospitality as a wine steward
- Mid 1990’s
  - wine sales rep
  - Completed 4 degrees in the wine business
- 2007 - left the University of South Australia and Australia overall with a Ph.D. in Wine Business
- Research areas include:
  - History and usage of screw caps and natural cork
  - Consumer behavior - consumption patterns that lead to wine consumption
  - Digital marketing, tourism
Defining Millennials
- Generational cohorts - they may change their name as certain experiences become the dominant characteristic of their values
  - Each cohort is distinct because of their experiences, which have information and directive influences
  - E.g., Silent (formerly Great) Generation - values were set during war years
    - Baby Boomers - the boom in population growth post-war
    - Gen X (used to be called latch key generation)
    - Gen Z (1997 onwards) - have no real memory of September 11th (2001), were initially called the “i -generation” because they were attached to their iPhones
- Millennials
  - Originally set from the late ’70s (as early as 1976) to the early 80s birth years
  - Current definition (from Pew Research Center and Brookings Institute) - 1981 - 1996
  - Attitudes and values formed during the decades around the turn of the 21st century (1990s-2000s)
Millennial Values and Attitudes
- Want a fulfilling career vs. a stable or secure career
- Exhibit stronger support for social and environmental issues
- Have the largest perceptual gap of their long-term vision vs. their initial reality - they had huge expectations of adulthood and were hit with reality (you start at the bottom) and the Global Financial Crisis
- Lived in the social media era - see the extremes (people curated perfect lives)
Millennial Wine Buying
- Wine buying is tightly correlated with economic status
- Generational buying
  - Silent Generation - marked by frugality, drank less wine because it was more expensive
  - Baby Boomers - expressed interest in wine and shares with others, have been the driver behind the recent success of the wine industry, wine as a relatively inexpensive way to show success and luxury (e.g., Silver Oak success)
  - Gen X - eschews traditional brands, tried different things (e.g., led to the Rhone Rangers movement)
  - Millennials -
    - focus more on enjoyment and the collective vision of what wine means for their generation
    - want individualism, but also consume brands that are more representative of their group
    - Humor, innovative approaches, bohemian, off-kilter brands can be successful
    - Willing to accept something that reflects values and intent, even if not total wine specific, whereas the prior generation was more focused on the wine itself)
    - Receptive to sales and marketing messages as long as it is authentic to the brand
- Buying pattern formative period in teen and early adult years, particularly for aesthetic consumption and will likely persist over time
- Millennial brand loyalty
  - Brand loyalty starts with awareness - awareness of anything trumps lack of awareness which makes consumers start with a degree of brand loyalty
  - The pattern is repeated until people gain more comfort with products and they move to brand extensions
  - New wine consumers (e.g., Millennials) are still new to the category, still just learning what wine is
  - Proud of and support brands that support them (e.g., Supreme - streetwear); wines they drink are wines that support them and have brand loyalty to them (e.g., Buena Vista, Chateau Diana)
  - Perception of brand loyalty may be due to low wine club signup rate
- Millennial wine spending habits
  - Spend 2x more than the grocery store average on wine
  - Highest spend per unit of any generation (high $20s - low $30s/bottle)
  - $10-15/bottle is the sweet spot in grocery/retail
- Awareness key to buying wine
  - Napa has the greatest awareness of any US wine-growing region, which helps
  - Iconic wines to still do well due to brand awareness

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Discovering Zinfandel w/ Carole Meredith, UC Davis & Lagier Meredith Jun 23, 2021

Show notes

One of the world’s leading grape geneticists, Carole Meredith, Professor Emerita of UC Davis and owner of Lagier Meredith winery, has spent decades identifying and profiling grape varieties. It was so interesting that the interview has been split into two episodes. Episode 55 covers the background of Ampelography and DNA profiling as well as the definitions of key terms such as variety, clone, and hybrid. In addition, this episode features the stories of how she uncovered the history of Zinfandel (aka - Primitivo, Crljenak Kaštelanski, and Tribidrag) with Croatian researchers and how wineries use DNA profiling in wine marketing.

Detailed Show Notes:

Discovering Zinfandel
- Zinfandel has a long history in California. People assumed it was a native California grape, but it is a Vitis Vinifera, so it must come from Europe
- People suspected Croatia, but no evidence
- In the 1970’s - people noticed that Primitivo in Italy’s Puglia looked like Zinfandel, and it was confirmed they are the same grape variety
- Italians said the grape is not Italian and came from Dalmatia (modern-day Croatia)
- Croatia
  - They looked at Plavac Mali - a popular red grape in Croatia. It looks similar to Zinfandel, but is not the same, but related
  - Mike Grgich of Grgich Hills Winery made some introductions to Croatia, but those were dead ends
  - 1997 - Ivan Pejic of the University of Zagreb reached out and wanted to understand Croatian grapes better
  - After 3 years of gathering samples, they found it in a Croatian mixed vineyard (a grape named Crljenak Kaštelanski)
  - 2001 - At the Natural History Museum in Split, Croatia - found a specimen called Tribidrag that looked like Zinfandel
  - Tribidrag was an important grape as far back as the 1300s
  - 2011 - Croatian research group was able to extract DNA from dead leaves in the Split museum and confirm it was Zinfandel
  - Proves Zinfandel is an ancient grape with historical importance
Tribidrag is not an approved varietal name for wine in the US. Lagier Meredith uses it as a fanciful name for their label
- Lagier Meredith sells mostly to their mailing list so that they can explain the history and the name to their customers
- Ridge calls a wine Tribidrag, growing vines from Croatian cuttings, and wants to partner with Carole to get TTB to have Primitivo and Tribidrag as Zinfandel synonyms
US TTB shows Zinfandel and Primitivo as separate varieties
- California Zinfandel producers opposed having Primitivo be a synonym because they didn’t want competition from lots of cheap Italian Primitivo
- EU wine label regulations list Zinfandel and Primitivo as synonyms
- 2004 - US & EU sign an agreement on wine labeling to respect each other's laws, so now Italians can label their wines Zinfandel and export them to the US
DNA typing - business impacts
- It has been a boost for Croatian producers, put them on the map, and now a wine tourism destination with people even visiting the vineyard where Zinfandel was discovered
- Mostly done out of research institutions
- Foundation Plant Services at UC Davis has a commercial DNA typing service - costs ~$300 / sample
Some producers (e.g., Schrader) use clones on labels - used as a distinction, helps to tell the story for marketing

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Grape DNA Profiling w/ Carole Meredith, UC Davis & Lagier Meredith Jun 16, 2021

Show notes

One of the world’s leading grape geneticists, Carole Meredith, Professor Emerita of UC Davis, and owner of Lagier Meredith winery, has spent decades identifying and profiling grape varieties. It was so interesting that the interview has been split into two episodes, this one about the background of Ampelography and DNA profiling as well as the definitions of key terms such as variety, clone, and hybrid. The second episode features how she uncovered the history of Zinfandel and how wineries use DNA profiling in wine marketing.

Detailed Show Notes:

Carole’s background
- Worked part-time at a retail nursery, got into plant genetics, and wanted to be a flower breeder
- Changed to doing a Ph.D. on tomato genetics at UC Davis
- Worked in biotech for a few years on cotton, corn, and soybeans
- She went into grapes because a position opened up at UC Davis
Ampelography - the study of grape identification before DNA testing
- Grape varieties identified by their leaves, which vary distinctly, not by their fruit, which look similar
- Before DNA testing, outside experts in Ampelography would often disagree with each other on grape identification
- The upside of ampelography is that it’s very fast. Today grapes are usually first identified by ampelography and then confirmed with DNA testing
DNA testing for grapes
- Started ~1991
- Looks at segments of DNA to look at specific markers
- Need a minimum of 6 markers to identify a variety and more to establish variety parentage
- Vitis Microsatellite Consortium - a group of academics that came together to develop DNA markers for grapes
  - In 1-2 years, developed 100s of markers
Grape variety definition - used differently in trade or by scientists
- Trade definition - grapes that make different wines (e.g., Pinot Noir and Pinot Gris) are different varieties
- Scientific definition - a cultivated variety that goes back to a single seedling, scientifically, Pinot Noir and Pinot Gris are clonal variants of a single variety
Clones - variations within a variety
- Clones are subtypes that have developed over time
- Usually have something to do with the fruit (e.g., color variants like Traminer vs. Gewurztraminer, Pinot Noir/Blanc/Gris)
- Clones arise through somatic mutations of the variety
  - Older the variety (e.g., Pinot, Syrah) - more likely to have more clones
  - Young varieties (e.g., Cabernet Sauvignon) have fewer clones (
  - Some varietals (e.g., Pinot) are more likely to have mutations
- People need to notice a difference (e.g., looser clusters which can have less bunch rot, early ripening, which avoids rainfall during harvest, or higher sugar levels for grapes like Riesling in cooler areas) and be preferentially chosen to plant new vineyards
- ENTAV - an institution in France that systematically identifies and registers clones
- In Chile, Jean-Michel Boursiquot, one of the world’s top ampelographers, identified that Chileans were calling Carmenere Merlot
Grape Families
- A term with no scientific meaning
- E.g., Muscat - “muscat” is a type of flavor; all current varieties likely descendants of a couple of ancient varieties
- Every variety is descended from 2 parent varieties
Hybrids
- Genetic/scientific definition of a hybrid is an offspring of 2 different parents of the same OR different species (e.g., Cabernet Sauvignon is technically a hybrid of Cabernet Franc and Sauvignon Blanc)
- Interspecific hybrid or cross is an offspring of parents from different species (e.g., hybrids of American and European grape varieties used to try and combat phylloxera)

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What’s Next for Argentina? Why, Malbec...w/ Laura Catena, Catena Zapata Jun 09, 2021

Show notes

Laura Catena, Managing Director of Catena Zapata, Founder of the Catena Institute, and Owner of Luca Winery, used to frequently get asked, “What’s next for Argentina after Malbec.” While Argentina has diversity in wine, its core calling card, quality, and diversity can also reside in Malbec. From storied beginnings to becoming a new classic, Laura shares with us the stories of the history of Malbec, how Argentina and the Catena family have elevated it with tastings, books, and scientific research, and how the future of Argentina is truly...Malbec.

Detailed Show Notes:

Laura’s background
- BA Biology from Harvard, MD from Stanford, also studied French
- She grew up in the vineyards in Argentina, went to high school in the US
- She wanted to help people, so she went into medicine, specifically emergency medicine
- Nicknamed “La Lucita” by her grandfather for never standing still
- ER doctors have shifts that enable other hobbies or careers, thus working both in medicine and wine
The History of Malbec
- A background in French enabled Laura to read French historical documents about Malbec
- Malbec was known in Roman times, w/ Cahors the main area
- Cahors drunk by Eleanor of Aquitaine who married King Henry II, making the wine popular in the UK as well
- In Bordeaux, Malbec was very popular, used to make Cabernet Sauvignon smooth and ripened at the same time as Cabernet, vs. the earlier ripening Merlot
- After phylloxera, gets replaced by Merlot
- Saved in Argentina, where there was no phylloxera
- It was being pulled out in Argentina due to low yields (prone to coulure) when Nicolas Catena started to do something with the variety
- The breakthrough moment in 1999 - a Wall Street Journal article about Malbec started to change things, Catena was noted as the top wine
- Malbec gives different flavors from different regions
  - Salta - jammy, syrupy
  - Patagonia - spicy, herbal
  - Adrianna Vineyard - some are big and tannic, others more like Pinot Noir
Flying Winemakers in Argentina
- Paul Hobbs, Michel Rolland, and others came and helped with changes to the winery (fermentation, oak barrel usage, etc.…)
- But soils and altitude were unique and different, which required new study, leading to the founding of the Catena Institute
Promoting Malbec
- Catena Malbec Argentino label - tells the history of Malbec through 4 women (including phylloxera)
- Catena Zapata
  - Initially made Cabernet and Chardonnay for export (1990-1991 vintages)
  - 1st Catena Malbec was 1994 vintage
  - Did lots of blind tastings, Laura’s mom went to stores and bought the best wine and blind tasted Chardonnays, claiming that every time, Catena won
  - By the time Malbec was introduced, the Catena brand was already known for its quality
  - The initial key market of the domestic Argentina market - provided income to support the cost of building up exports
- Books
  - Vino Argentino - wanted an English book to highlight Argentina
  - Gold in the Vineyards - talks about special sites globally, shows concept via illustration to make it more engaging
  - A new book to be published on the history of malbec
- Believes in not telling too many stories at once and making it interesting, usually for 1-3 years
  - Malbec Argentino - created a 20 min theatrical play of the story, hired a UK actress to perform
  - Current discussion - “Let’s Talk about Grand Cru and Gran Vins” - discussion of Catena parcella wines with Pinot Noir and Nicolas Catena with Bordeaux or Napa Cab, with Larry Stone MS
Catena Institute
- Shares all research for the benefit of everyone in Argentina
- Established to solve a specific problem: how to elevate Argentina’s wines
- Publish all work - must be of high quality for peer reviews, wanted to share it, and made other institutes want to do research together
- Recent Study: Proof of Terroir through Malbec
  - It looked at 24 sites in Mendoza
  - 50% of the sites have a fingerprint that is identifiable (via 10 different anthocyanins and 20 different polyphenols)
  - Shows proof of terroir and that some terroir is more identifiable than others -> showcasing the meaning behind “Grand Cru sites”
Making Malbec collectible
- Need to be patient
- Need to do a lot of tastings
- Ratings are important
- Tourism is also important - building a new hospitality center at Catena, want it to be the best experience in the world, something people will travel for

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Alentejo the Last Frontier of Europe w/ João Gomes de Silva, Sogrape and Herdade de Peso Jun 02, 2021

Show notes

“The last frontier of Europe,” “A pristine region,” “A mosaic of soil varieties and temperatures” are all ways João Gomes de Silva, Board Member of Sogrape, describes the Alentejo wine region. João tells us about the evolution of Portugal’s wine industry, the complexity of the Alentejo wine region, and how the industry has been promoting and building the brand of Alentejo wine. From “seasoning” to amphora, there’s plenty to get excited about with Alentejo and its wines!

Detailed Show Notes:

João’s background
- Family is in agriculture and farming
- João is a wine lover
- Worked in food retailing
- Lived in Italy and Latin America
Sogrape background
- Founded in 1942 by Fernando van Zeller Guedes and launched with Mateus Rose
- A family business where they work as a professional team
- Combination of concept wines (e.g. - Mateus) and fine wine estates (e.g. - Barca Velha, Sandeman)
- Mateus Rose - Sogrape’s founder said it had to stand out
  - Unique bottle shape - shaped after WWI cantil (soldiers’ water bottles)
  - The label has a picture of a manor house in North of Portugal, which was to look like a French chateau
Portuguese Wine History
- Early-mid 1990’s - Portugal joined the EU, lots of investment in the wine industry and a surge in domestic demand
- 2005-2010 era - a lot of modernization happened in the wine industry
- 2010+ - a boom in tourism in Portugal led to a boom in demand for Portuguese wine
- Covid - demand for Portuguese wines did not dip
Alentejo as a wine region
- South of Lisbon, between Lisbon and the Algarve (a beach area popular for tourists)
- The same size as the state of Maryland, but with only 700,000 people - a sparsely populated farming area
- One of the last areas dominated by the Moors (until the 13th century)
- Traditionally the breadbasket of Portugal, lots of cereal, grain growing
- Dry, warm climate (>100F in summer)
- During Roman times, made wine in clay amphora to preserve temperature during fermentation
- 8 sub-regions
  - Portalegre - north part of the region, the influence of the mountains (a colder, wet climate)
  - Eastern area near Spanish border - very dry, arid, pre-phylloxera vineyards
- A mosaic of soil types, climates, and grape varieties
- The notion of “seasoning” important in the region (e.g., using small amounts of different grapes varieties to blend)
- Grape varieties - a mix of traditional and international
  - Traditional - Aragones (Tempranillo), Trincadera, Moretto, Arinto, Tourigal National
  - International - Syrah, Alicante Bouschet - the star of the region
- Vinho de Talha - wine made in the traditional Roman way in clay amphora, the only region in Portugal that has this regulation
- Wine style - fruit-forward, rounded tannins
- Current consumers - wine explorers and hedonists who know what they like
Alentejo Wine Consumption
- Domestic - 80%
- Export - 20%
  - Brazil - 30%
  - US, France, Poland, Switzerland - ~10% each
  - Canada, UK, Angola, China - ~5% each
- Entry-level pricing ~$7-9 USD
- The sweet spot is ~$20 USD to really show terroir
Marketing messages
- A unique, single message (especially for US/UK markets) - “taste of the last frontier of European wine,” a pristine region
- Brazil - talk more about individual producers as people already know Alentejo
- Journalists / somms - talk more about winemaking techniques, bringing people to Portugal
- Consumers - the experience at the estate or virtually tends to grab them
- Broad / “Generic” promotion - through Wines of Portugal and CVRA (Alentejo region wine marketing body)
  - Invests in trade fairs (e.g., Prowein, Vinexpo) which help
- Herdade do Peso - invests in social media
- Being closer to the distributor (and owning them) helps - has been important to the success of brands
Herdade do Peso, a Sogrape winery
- Sogrape’s founder believed he could change the Alentejo industry
- Introduced Alicante Bouschet to the region, blended it with Touriga Nacional
- “A mix of man’s ingenuity, dream of a family, and the natural conditions found there”
- 16 soil types, 160ha of vineyards
- Use clay amphora to season wines, but no pure Vinho de Talha
- Wine positioning
  - Entry-level, single estate - ~$20 USD
  - Reserva, a blend of blocks with the best expression, can age
  - Essencia - block series, best block of each year
  - Icon - only been produced twice in 30 years, the highest expression of the grape
  - Another wine (collaborating with others) in the works
Climate change - brought back Gobelet training, new grape varieties, use water from the artificial lake to protect plants against extreme weather

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Selling Uruguayan Tannat w/ Christian Wylie, Bodega Garzón May 26, 2021

Show notes

“Ura-what?, Ura-where?” Selling Uruguayan Tannat has many challenges, recognizing both the country and the signature variety not well known globally. However, Christian Wylie, General Manager of Bodega Garzón, and owner Alejandro Bulgheroni have risen to the challenge. So much so that the late, famed wine writer Steven Spurrier once said that “Garzón achieved iconic status in less than a decade.” Hear all about the journey for Garzón and Uruguayan Tannat in general on this episode of XChateau.

Detailed Show Notes:

Christian’s background
- Chilean from a British family
- Studied agricultural engineering in Chile and enology at UC Davis
- He was a hands-on winemaker for a while
- An entrepreneur with fresh herbs
- Met an Uruguayan woman and got married to her - started the connection with Uruguay
- Worked at Familia Deicas (Uruguay, 6 years), Santa Carolina Group (Chile; 11 years) - turned it around and grew it 3x
- Joined Bulgheroni Estates in 2016
  - Now has 21 wine estates in 6 countries
  - Garzon is the headquarters
Bodega Garzón Overview
- Garzón is a place in the NE part of the Maldonado province
- Bulgheroni bought land in Uruguay in 1999-2000, started with olive trees and olive oil
- 2006 - bought hills above olive trees for windmills, but Bulgeroni’s wife vetoed it
- 2007 - Alberto Antonini comes and suggests vineyards would be good
  - 34.8० S latitude - the same as Apalta in Chile, Barossa in Australia, and Stellenbosch in South Africa
- 2008 - Vineyards planted
  - ~600 acres of vineyards divided into 1,500 lots
  - >20 different grape varieties, but mainly Tannat and Albarino
  - Atlantic ocean influence
  - Granite soils vs. clay in other Uruguayan winegrowing regions
- 2016 - Winery opened
  - 5-acre building on the top of the hill
  - 1st LEED-certified winery in the world
  - ~100 euro/liter winery capacity cost to build (very high)
- ~$200M in Capex, 120k cases of wine produced
- Has a PGA tour preferred golf course
Uruguayan Wine
- 6,000 ha / ~15,000 acres planted, but mostly table wines
- Garzón represents ~20% of VCP (premium wines)
- Exports ~5-10% for most producers, Garzón exports ~67%
- 300 wineries, ~60 VCP wineries, ~25 actively exporting
- Tannat - the national grape
  - Originally from Madiran, France
  - “Survival of the Fittest” likely reason for becoming national grape in Uruguay - hot and humid climate did not do well for other dry climate European varieties, Tannat likely had better yields
  - The name comes from the tannins, has the most polyphenols (2.3-2.4x more Resveratrol than Cabernet Sauvignon)
- Traditional style - big, rustic, tannic, but easier to drink than Madiran; usually overripe fruit, heavy extraction, and lots of oak (heavy toast, American)
- Garzón Tannat - more fruity, fresh, vibrant; minimal intervention, some carbonic, cold soak, unlined cement fermentation, large vat French oak
- Other varieties: Marselan (lots in China, now an approved Bordeaux variety), Merlot
Key markets for Tannat
- Garzón - Uruguay (~40% of premium wine is Garzon), US, Brazil the three top; export to >50 countries (Nordics, Japan, UK, Canada, Netherlands other key markets; Growing markets - China, S Korea, Singapore, Russia, & Mexico)
- Uruguay in general - Brazil #1 (mostly low priced, bulk wine)
Garzón portfolio
- Estate = entry-level, mostly sold domestically
- Reserva = higher tier based on the quality of grapes,
- Single Vineyard = areas w/in estate, ~$30 USD
- Petite Clos = 1 specific parcel, ~$70 USD
- Balasto = top wine, ~$100 USD in the US, ~$200 in Uruguay
  - Named after the decomposed granite
  - Blend of the best reds of different parcels
  - 3rd wine from South America sold via La Place de Bordeaux
Marketing Tannat & Garzón
- “Taste first, then say what it is”
- Started Wines of Uruguay 20 years ago, but wines didn’t sell because no one had heard of it, needed to promote everybody
- Consumers - banked heavily on social media - has ~80k followers on Instagram
- Created a dynamic website
- Trade (e.g. - MS/MW) - “reverse mission” - bring them to Garzón
- PR - Glodow Nead - has brought Playboy, Architecture magazine, Robb Report, NY Times
- Wine Critics - great scores from James Suckling, Wine & Spirits, Decanter, Wine Enthusiast’s 2018 New World Winery of the Year - consumers need the 3rd party validation
- During pandemic - keeping the brand alive w/ 100s of “zooms” and webinars

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Mailing Lists for European Wineries w/ Kevin Sidders, VinConnect May 19, 2021

Show notes

For the first time, European wineries can have direct relationships with customers, and lovers of many European wineries can consistently secure access to their favorite wines via the VinConnect platform. Founder and President, Kevin Sidders, explains how VinConnect works, tells us some of the unique, rare wines that have been offered, and all the reasons how VinConnect benefits their winery partners. Not a new way of buying wine, but bringing the American direct-to-consumer experience to European wineries.

This episode is sponsored by Sonoma State University’s Wine Executive MBA program. A 17-month, transformative program that builds leadership skills and business acumen focused on the specific needs of the world of wine. Learn more about SSU’s Wine MBA programs here. If this is something you’re considering, the next Global Wine Executive MBA session’s enrollment deadline is June 30, 2021, for courses starting in October!!

Detailed Show Notes:

Kevin’s background
- Lived in the Bay Area 25-30 years ago, discovered wine and joined mailing lists of California wineries
- Was in the finance industry
VinConnect founding - 10 years ago
- Struggled to buy and collect wines from Europe
- Was on mailing lists in California and wanted the same experience for European wines
VinConnect Customer Experience
- Just like signing up for a US mailing list
- Sign up, get offers, have wine shipped to you
- VinConnect works as an extension of the winery, a facilitator
- Key benefits
  - Convenience, consistent access - “never miss a vintage,” which Kevin experience himself with Domaine du Pegau
  - Relationship / communications direct from the winery
  - Special treatment in hospitality
  - Provenance - authentic and shipping through winery approved channels (in good condition)
  - Occasionally special goods - unique wines (including a never release bottling from Chateau Musar, formats, vintages, library wines
Logistics
- Supports planning, strategy, and pricing with wineries - wineries decide how they want to operate their program (communications, offers, etc…)
- 2 models for buying
  - Single national importer - who sells to distributors, then retailers
    - VinConnect buys from importer
  - Direct to distributors - winery may have ~30 relationships in US
    - VinConnect buys from winery directly
- Allocations - depends on the winery, some have purchase limits, some do not
- Wine Clubs - a couple wineries run clubs on the VinConnect platform
- Each winery list is separate, no cross communication
- When a new winery launches on VinConnect, all customers are notified that they have the ability to sign up - this is the only communication to all customers
Types of wineries that fit - high profile presence in US, flagship winery of their region - platform is more useful when the brand has a consumer presence
How Consumers sign up
- The winery - visits in hospitality (most European wineries haven’t been as good at this), signups via winery website, social media driving to mailing list
- VinConnect website - can sign up for all lists via the website
- Google advertising
Benefits for wineries
- They can’t do this themselves in US
- Creates communication channel with consumers
- Can create in-market events w/ consumers
- Have access to all customer data (via dashboard portal)
- 65 winery partners as of April 2021

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One Year Anniversary - Live on Clubhouse May 12, 2021

Show notes

When Robert & Peter started the XChateau Wine Business podcast, the idea was to try and build a community around the business of wine. Part of that has been engaging with our listeners, as well as our guests. While it has happened on an ad hoc basis, we wanted to do it more proactively for our 50th Episode / One Year Anniversary. We recorded our 50th episode live on Clubhouse to have a broader interaction with former guests (Juliana Colangelo, Lauren McPhate, and Maureen Downey), other guest partners (Barb Tyree from Repour and Tess Roche from WineBid) as well as listeners. We covered topics around the current status of re-opening in the US, an update on the fine wine market, favorite episodes, and ideas for future episodes. Listen in and let us know what you think!

Special Announcement: Repour, one of our sponsors, has also created a special discount for XChateau listeners through May 21, 2021. Use the code: XChateau on the Repour website and get 20% off for both retail and wholesale orders! If you haven’t heard of Repour, find out all about it in Episode 24, where CEO Tom Lutz gives us all the details.

Detailed Show Notes:

This episode was recorded live on May 4, 2021, on the Clubhouse platform
US Covid business updates and trends
- Lots of open jobs right now, especially in hospitality, the US is recovering from Covid quickly
- Juliana Colangelo (Colangelo & Partners) - returning to normal media relations, going through a transition period with both in-person and virtual; a client is hiring a virtual tasting room manager, there will still be demand for virtual events
- Barb Tyree (Repour) - restaurants are coming back online quickly
- Nadine Brown (sommelier in DC) - retailers did well in DC during Covid, huge staffing issue in DC
Fine Wine Market update
- Lauren McPhate (Tribeca Wine Merchants) - in fine wine, people are still more adventurous with their purchases, buying new regions; the store in NYC re-opened a couple weeks ago; tariffs removed from Europe leading to buying again from Europe, but shipping is the big issue currently
- Maureen Downey (Chai Consulting) - wine collectors have drained their cellars, tariffs haven’t impacted buying at the very high end; Italian wines are trending, increased sale of counterfeits (e.g., Acker sold a counterfeit bottle of whiskey)
- Juliana Colangelo - more wineries selling back vintages from their library
- Tess Roche (WineBid) - continuing to see lots of new wine buyers on WineBid, increase of younger buyers purchasing, more mobile orders, increase in unique wines that haven’t had much auction activity in the past
- Maureen Downey - fine wine has always been bought site unseen, so online is “normal,” but people who would have bought in the grocery store before have moved online
Favorite episodes
- Ivonne Nill (listener, MW candidate) - loves specific examples for Master of Wine essays, e.g., Wine.com, Wine Australia, and Juliana Colangelo’s episode on Social Media Influencers
Future episode ideas
- Roundtable discussion on global wine trends
- Consumer-oriented brands discussing what’s working well for younger generations
- Bulk wines
- Wine buying journey of wine collectors
- Career transitions into wine
- Scoring publications and impact
- Personalization/customization of wine buying

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Drink Better Wine w/ Heini Zachariassen, Vivino May 05, 2021

Show notes

Focused on helping the casual wine consumer buy better wine, Vivino has spent over 10 years building its database of wines, creating a structured tastings database, and network of merchants to make buying better wine more convenient. Heini Zachariassen, founder and CEO, tells us about the journey, what Vivino is up to today, and where it’s going. A must-listen for anyone interested in wine.

Detailed Show Notes:

Heini’s background
- born in the Faroe Islands, with only ~50,000 people and no wine
- An entrepreneur into technology
- He got the idea for Vivino from “seeing a wall of wine and not knowing what to buy”
Vivino’s core challenge - buying wine is difficult. Vivino wants to help people drink better wine and know what to buy at stores through rating every single wine out there
1st slogan - “Never forget another wine” - because Vivino didn’t have the database to do more than capturing the wines
With the database, you can now say if the wine is good and what else you might like
Ratings with at least 10-20 ratings are highly correlated with expert ratings
Users -
- 50M total users
- ~20k users every day, ~10M users every month, ~20-25M active users every year (% of active relatively constant over time)
- Top 3 areas of interest for consumers - #1 ratings, #2 price, #3 what does the wine taste like
- A lot of people rate - 15-20% of scans rate the wine, 6-7% of scans review the wine
- App use is 50/50 exploring wine (out somewhere looking at wines) and drinking wines (mostly at home, but could be restaurants, etc.…)
- “Featured users” are pushed in the community. Some have 50-100k followers
- The target audience is always the casual wine drinker first
Launched taste characteristics - a structured tasting note (both wine structure and tasting profile), uses AI to get the data into the system
AI recommendations (“Match for You”) - gives a % on the wine of how likely you’ll like it, leveraging structured tasting
Marketplace
- 700 merchants on the platform, 50% in the US, from small retailers to Wine.com
- Sell in 17 countries right now
- Today only a small % (single digits) buy wines through the app - he believes there is a big upside
- Fully integrated w/ Vivino, users can use Google and Apple Pay
- Money goes directly to the merchants, Vivino bills a marketing fee
- Location matched by merchant's ability to ship to the location, the app only shows things you can buy
- Can now search for styles of wine based on structured tasting notes
- Wine sales - ~50% are pull (people looking for specific wines), ~50% are push (primarily surfacing what the app says is great value for money)
- Sales can be 1,000s of bottles to 100,000s of bottles for the launch of Post Malone’s Rose in a few days
Revenue Streams
- The marketplace is the biggest
- Sponsorships - newer revenue stream, for wineries - don’t directly push wineries, but make them look better when people come across them (e.g., show them a video when they scan the wine), provide data analytics to the wineries (based on Looker connecting to Vivino data), do campaign follow up (e.g., get an email about the brand after drinking the wine)
- No ads - always want to show what Vivino thinks is the best wine for you
Recently raised $155M round D (2021)
- Vivino is currently ~200 people, looking to expand, particularly product engineering
- Want to expand into more geographies
- Do more marketing - today, only spend 1.5% of GMV (gross merchandise value) on marketing
Vivino vs. Delectable - Delectable was more focused on somms and wine influencers, which kept them on the platform, but pushed away from the casual wine consumer and felt very “insider” vs. Vivino focused on the casual wine consumer
Vivino vs. Wine-Searcher - Vivino values convenience more. Wine-Searcher focused on higher-end wines, looking for specific bottles of wine and where to buy it, don’t do transactions
Vivino vs. Drizly - the focus is on convenience for delivery, has a network of 1,000s of retailers, faster and less concerned about what exactly the product is, Vivino more focused on wine exploration and ratings

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