Stay ConnectedA podcast delivering wine perspectives ex-chateau. Insights, analysis, and perspectives on news and trends in the wine industry beyond winemaking, such as marketing, finance, and consumer trends. From noted wine blogger Robert Vernick (@wineterroir) and leading wine business consultant and author of Luxury Wine Marketing Peter Yeung (@winebizguy), this podcast navigates the business of wine with unique perspectives and insights.
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Copyright: © 2020 - 2021 XChateau
Having helped grow Duckhorn from $5M to $500M in revenue and the sales team from 1 to >100 people, Pete Przbylinksi, former Chief Sales Officer of The Duckhorn Portfolio for nearly 30 years, has a deep understanding of managing US wholesale markets. In part two, Pete discusses selling into on- and off-premise chains, pricing, marketing, and more.
Detailed Show Notes:
Selling on-premise takes more time, need to present the wine, sell 1 case at a time, but more marketing value
ROI skews towards off-premise if you ignore brand equity
Calera / Kosta Browne targeted 65-70% on-premise, but hard to enforce
Selling off-premise chains
In-store displays
Shelf placement
Large on-premise accounts
Decoy’s success driven by off-premise
Price increases
Discounting
Impact of marketing on sales
Advice for a tough wine market
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Having helped grow Duckhorn from $5M to $500M in revenue and the sales team from 1 to >100 people, Pete Przbylinksi, former Chief Sales Officer of The Duckhorn Portfolio for nearly 30 years, has a deep understanding of managing US wholesale markets. In this two-part episode, Pete dives into every aspect of managing a wholesale sales team, including incentive structures and collaborating with distributors.
Detailed Show Notes:
Duckhorn went from 50k cases / ~$5M in revenue / 14-15 employees (1995) to ~$500M revenue (2024)
The Duckhorn Portfolio
Keys to Duckhorn’s success
Sales team grew from 1 person to >100 (~85 in the field)
Sales team roles
Distributor consolidation led to wineries needed to do the work they cannot do
Identifying top salespeople
Incentivizing salespeople
Distributor collaboration best practices
Optimal size of sales territories
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Building a new wine category is not something that is easy to plan. It often is more like a startup, where belief in the product and market is just as critical as a defined strategy. That's how Luisa Amorim, CEO of Amorim Family Estates, launched Mirabilis into being an iconic still white wine of the Douro Valley. She outlines priority markets, views on scores and social media, and her belief in word of mouth marketing.
Detailed Show Notes:
Luisa’s background: hospitality, marketing; started in the family business at 23; spent 3 years in a global rotation program
Amorim Family Estates
Mirabilis (part of Quinta Nova)
Whites still have pricing barriers vs reds
Douro white differentiation: close to Atlantic, schist soils, native grapes, and blending
Introducing Douro whites: older people were harder to get on board, younger were more open to exploration
Need to have belief in product and its viability over having a detailed marketing plan
Marketing focus has been on teaching Portuguese wines (including culture and traditions)
Geographic focus for Mirabilis
5 people, based in Portugal, work internationally; travel 3-5x/year to each market
While design and packaging, price positioning are important, the sales team and their relationships are critical in the wine industry
Having a good wine is more important than press or reviews, people are paying less attention to reviews
Consumers now look at peers and friends for recommendations and they need to trust the wine producer
Social media - “should be doing more” - hiring younger people into marketing
Wine marketing needs to capture the “soul” of the wine
Has not done any paid advertising
Relies on word of mouth (people taste, buy, and talk) and partnerships
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With 30 generations in the wine business, the Frescobaldis have a long-term view of the wine business. This mindset has enabled Ornellaia to become a global icon. Lamberto Frescobaldi, President of Frescobaldi, discusses how Ornellaia established and maintained its status as a global icon.
Detailed Show Notes:
Background: grew up in the Italian countryside, studied at UC Davis, learned the wines of the world working at Corti Bros in Sacramento
Frescobaldi family
Ornellaia overview
Distribution is mostly allocated due to limited quantities
3rd party validation (wine critics, famous artists, top restaurants) key to building reputation
Vendemmia d’Artista
Ornellaia Blanco
Monitors secondary market to help learn about wine’s age ability, if prices dropping, implies inability to age
Not sure if people buy Ornellaia from seeing it on social media, but allows winery to connect directly to customers
Negative macro market conditions and trade wars not impacting Ornellaia much, 3rd wine (Le Volte) more susceptible, but haven’t seen impact yet
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With over 40 years of managing some of the top names in wine (Opus One, Mondavi, Baron Philippe de Rothschild), David Pearson, President of Joseph Phelps, has developed a distinct point of view on how to build a globally iconic brand. Ultimately, it comes down to relationships and the effort required to maintain them. From focus and prioritization to spending upwards of 65% of time on the road, David hopes more wineries will follow in his footsteps to build the category of Napa and American wines globally.
Detailed Show Notes:
David’s background: started as a winemaker (Europe, SoCal), sensory evaluation for Hublein (now Diageo), post-MBA marketing job with Baron Philippe de Rothschild, Mondavi in France (see Mondovino movie), managed Byron, then CEO of Opus One, now President of Joseph Phelps
The goal is to create personal relationships and care about mutual success and partnership with accounts
“Focus is the hard part” - at Opus, initially London, Hong Kong, Japan; then emerging markets, Mainland China, Dubai; Phelps also prioritized Korea
The goal is to expand export to ~30-40% in 10 years vs. 12-13% of Insignia today
Brands need to think deeper about what’s unique and also where they are going
The winery owner had three objections to export:
Larger volume wines have different commercial relationships, same elements (knowing your partners, need to build), but margins tend to get squeezed
Believes that if the category is successful (e.g., Napa), everyone will be more successful
Negociants (La Place) respond to existing market demand well and are efficient distributors, but it is not in their DNA to build brands
Phelps uses the LVMH distribution network to build the brand and deliver directly to the core accounts
Measures quality of relationships w/ initial feeling, but then seeing the wines go to the market, need to see forward momentum
Tracks Liv-ex pricing a lot, seen upticks in Insignia
Other marketing elements: relationships happen over multiple channels now, need to do more social media, and be part of the discussion
The pricing goal is to have trade and consumer connect the innate value of the wine to the price
The current neo-prohibitionist environment recalls the 80s and the “Mondavi defense” of wine as a potential solution
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Pairing their need for a complex substitute for wine, for both pregnancy and professional network, Maggie Frerejean-Taittinger and friend Constance Jablonski enlisted Maggie’s husband, Champagne and Cognac winemaker Rodolphe to found French Bloom. With four years of R&D prior to launch and constant refinement since, French Bloom aims to redefine the alcohol free premium sparkling wine space. Maggie & Rodolphe delve into the creation of French Bloom, exploring its core markets, target customers, and the factors that have drawn them in.
Detailed Show Notes:
French Bloom overview
4 years of R&D to get the desired quality
Extra Brut (0% abv, 0 sugar) has a base of 30% reserve wine from 2 years, aged in new oak barrels to give more structure
Better to make adjustments before de-alc vs after
Use voile to protect wine from oxidation (like Jura)
Flash pasteurization is used b/c no abv, sulfites to protect the wine
NA market
French Bloom customers
Sells 20% DTC globally
2024 NielsenIQ study on NA purchase behavior - #1 driver - for conscious hosting (aligns w/ French Bloom’s ethos of not excluding anybody); #2 health & wellness; #3 driving
Marketing is digital first, leveraging Constance as a tastemaker and key opinion leader
More partnerships - Coachella, French Open, just signed F1 (10-year partnership, 1st ever official NA sparkling wine, Moet Chandon on podium; F1 new fans are 75% female, 50% Gen Z from Netflix series)
Most effective marketing has been the founding story and authentic storytelling (i.e., Maggie’s pregnancy, Constance’s need for moderation while networking)
Marketing through top-tier restaurants, hotels, and shops (e.g., Michelin-starred; became the #1 wine sold at Erewhon in 1 week)
Michelin-starred restaurants have 50% non-drinkers at lunch, 20% at dinner
No sugar, no additives, organic messaging plays well in California, less on the East Coast
Uses the term “alcohol free” vs. “non-alcoholic”
NA trends around NA wine & food pairing, including “moderate pairing” (wine & NA wine/drinks as part of pairing); mirrored cocktails (3 versions ofthe same cocktail - NA, low, full)
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Selling the very rare, collectible wines of the world, Adam Bilbey, SVP, Global Head of Wine & Spirits for Christie’s, has a unique view into the state of the wine collector. Adam maps the thought processes and changes in attitude of buyers and sellers of rare wine globally, and he is seeing “green shoots” in the market by mid-2025.
Detailed Show Notes:
Adam’s background - started w/ Berry Bros out of high school (2000) at Heathrow Airport shop, moved to Hong Kong in 2010 w/ Berry Bros, Sotheby’s in 2015, Christie’s in 2021
Christie’s is known for fine art, and wine is part of the luxury group (jewelry, handbags, cars), which is 20% of sales, and wine is 10-20% of luxury sales
2025 wine auction market
Burgundy has taken share from Bordeaux last 5-6 years, Champagne came up and leveled off, Italy is strong in the US but not in Asia, Burgundy is strong in Asia, but leveled off
Interest in more mature vintages, particularly Bordeaux, is still valued there
Focus on provenance, people won’t bid on poor provenance anymore
With a more global market than ever, people buy from anywhere
Liv-ex shows -10% pricing last year, -20% last 2 years; auction prices move gradually, often lots don’t sell
More Millennials and Gen Z customers (45% 2025 from 30% 2022)
Female customers have been consistent last 4-5 years, a slight dip in the US, and growing in Asia
Younger generations are drinking younger wines, they like the security of younger wines, have a fear of disappointment in older bottles
Online auctions require ease of use
Provenance is improving with more communication (e.g., purchase & storage records), people working together (merchants, auction houses), and technology (digital microscopes, UV light, carbon dating)
Provenance is critical, as people remember the bad bottles sold to them over the good ones
Believes China will make a comeback in the next 2-4 years
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Making wine is capital-intensive. Making traditional method sparkling wine is even more so. From less juice from the grapes to double fermentation to more expensive bottles and taxes, Weston Eidson of recently launched Westborn Wine describes the differences in sparkling production.
Detailed Show Notes:
Weston’s background: >10 years winemaking in Napa (Silver Ghost), family are wine collectors, interned w/ Jason Moore at Modus Operandi (2012), and acquired extra Chardonnay from Steve Matthiasson
Westborn was founded in 2018, taking “Grand Cru” or single vineyard level fruit for sparkling wine (e.g., Heintz, Ritchie, Durell vineyards)
Partnered w/ Russell Bevan (mentor) and Nathan Reeves (made sparkling in Margaret River)
The goal is to start with high-quality wines and layer on complexity with traditional method aging
Took 4-5 years to find a stride & hone the winemaking process
Initially thought it would be 3 years aging vs 6 for 1st release (2019 1st release; 2018 1st vintage just disgorged mid 2025)
SKUs: vintage, Blanc de Blanc, Rose, Non-vintage
Luxury priced - $100+
Solera method perpetual reserve program, late disgorged release, lead to a lot of capital in inventory
2018: 500 cases; 2025 ~1,000 cases; target ~2,000 cases
Sparkling production costs vs. still wine
Financing is combined with other brands, which may make it hard to start a sparkling brand as a stand-alone entity
Look at the business plan over 20 20-year time horizon, projecting cash flow positive in 2027 (9 years from founding)
Trends underpinning Westborn strategy: following Michael Cruse w/ grower CA sparkling wine, premiumization, sparkling doing relatively well, sparkling being used beyond celebrations
Take inspiration from Bereche, De Souza (lees stirring in bottle to amp up umami), and Selosse
People looking for experiences have a tasting at The Art Collective Napa Valley
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It’s a cycle that has been happening since the late 1800s. The need for agricultural labor in California is a cycle of bringing in labor and then deporting them when they become too visible. Elaine Chukan Brown, wine writer and author of recently published The Wines of California, describes the history, current situation with new regulations and deportation, and the tension put on vineyard workers’ wages in California and their impacts on the labor market and vineyard workers.
Detailed Show Notes:
The Wines of California covers 3 sections:
Interest in farmworkers started with Salud, a medical program for vineyard workers and their families
CA is the largest farm region in the US
Sources of farm labor (in chronological order)
When labor populations grow and get too big, they are expelled, which has been in ~20-year cycles
H2A Program - temporary work visa program
FDR (1930s/40s) - Labor Protections Act created worker protections, but excluded agriculture
United Farmworkers (1975) - 1st farmworker protection legislation
Association of Farmers - farm wonders banded together to have more leverage against workers
Ever-growing CA labor regulations create large compliance requirements that end up favoring big business
Current system sets up farm workers’ wages as the only lever for farm owners to maintain profit margins and be economically viable (w/w/o gov’t subsidies)
New CA farmworker overtime pay law - 8 hours/day, 40 hours/week before overtime
Many crops (e.g., strawberries, peaches) need manual labor and can’t be mechanized
ICE raids & deportations: not a new thing, but what’s new is people with documentation (visas, amnesty recipients, citizens) are being detained and deported
US tariffs increase prices to consumers, decreasing sales; it may take decades for consumers to substitute for domestic wines
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With a large domestic market for wine, US producers often don’t focus a lot on exports. Honore Comfort, VP of International Marketing for Wine Institute, lays out the benefits and challenges of exporting wines globally. She covers the top markets for US wine globally, the role Wine Institute plays in helping US exports, and the potential impacts of the current trade war.
Detailed Show Notes:
Wine Institute overview
CA is the 4th largest wine region in the world after France, Italy, and Spain
Cost to produce is high in CA (heavily regulated - environmental & labor force protections; land costs high)
Goal to showcase the diversity of CA wine globally, but only a sliver is available
Key int’l markets - Canada (#1 until Feb 2025; ~30% of US exports - premiers took all wine off shelves as part of trade war); Europe #2 (Germany is hard w/ strong domestic, low priced market; Scandinavia big); UK #3 (punches above its weight as oldest wine market, lots of wine writers, critics, traders; one of the broadest selections of CA wine); China, Japan, Korea, Mexico
Wine Institute has active programs in >30 countries for CA wines
Benefits of exporting wine: importers sell wine for you (no 3-tier system like the US), build brand visibility, position wines next to other great wines of the world
Challenges of exporting wine - takes investment, needs face-to-face storytelling
Small Napa producer (<5k cases) now exports 15% of sales working w/ Wine Institute
IWSR creates an index ranking all wine markets globally on attractiveness (2024 - US #1, Canada #2, Switzerland #3 - a small country, but strong wine culture and high value wines)
EU subsidies are pervasive (e.g., bottling line, materials subsidies, marketing support (Italy $150M/year), buying excess bulk wine), but hard to get complete info
The US has less support for alcohol (USDA has $8M/year for CA wine); wine is the highest value US export, but low in total value
Trade war impacts
Wine Institute promotes “0 for 0 tariffs” - keeping wine out of trade disputes
Major policy priorities: US dietary guidelines (on alcohol), getting wine back on the shelf in Canada, Ingredient & nutritional labeling, CA bottle bill on recycled glass, and environmental regulations
“Share Wine” program - building understanding, community, and engaging with wine consumers, focusing on 25-45 year olds, centering on relationship w/ technology
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