Seismic Shifts

Car manufacturers and dealers know that every one of us only have a limited number of purchases for their products in our lifetime. Restaurateurs likewise respect that we can only eat dinner about once a day. And the folks at RIM who made the Blackberry cell phone the gold standard not that long ago are learning the hard lesson that in order to stay successful, you have to be both innovative and flexible.

The real world is not a static place. The sands are always shifting under your feet. Consumers are fickle, their decisions are short-term as to how much and how often they can consume.

In the beverage world, it's worse than dog-eat-dog (that may not be a good analogy when it comes to adult beverages). It's all very much a case of what do I want at this moment, what is available to me right now, and what are all the choices? Does a cocktail seem about right? And should I go with a "clear" spirit - vodka, gin, rum? Or maybe something a bit darker, like dark rum, bourbon, tequila? Maybe even a beer, or a wine. Or something a bit more exotic like cognac, cachaça or pisco.

Here's the dilemma for the manufacturers of all of those adult beverages: you won't be buying them all at one moment. Unless you plan on having one kick-ass party. Usually when you are thirsty, there is one winner and many categories of losers. And essentially when the losers are not on a roll with you, that is not good news for their bottom line.

In the economics of this world, it can get particularly serious for spirits manufacturers. But it may not be for the reasons you think. You see, with spirits, the manufacturing can actually be practically unlimited. The manufacturers pretty much make as much as the market is demanding whenever it needs to be done. The stills are operating around the clock anyway. Quantity of raw product, except in rare instances, is virtually unlimited.

On the other hand, with wine, you only have one chance a year to make the best of the harvest, and then pay strict attention in the winery as the juice is vinified and aged. Screw up any phase and the entire operation will, just like the Saints of old, wait till next year. By the way, that waiting will be done without the guy - or the team - that messed up.

Which brings us again to the all-important consumers' purchasing decisions.  Here is where the seismic shift has taken place, and some members of the wine community have missed the zang. They are still zinging.

Looks to me like many winemakers in California still think they are hanging the moon each evening, then sticking around so the sun can both rise and set over their vineyards. They have not quite come to fully appreciate the fact that their important potential market, new, young consumers, ages 21-30, are just as likely to reach for a cocktail as opposed to a glass of pinot noir or a beer.

Winemakers have not realized that their competitors are probably not the vineyards next door, but the distillery a continent away. And that the proper method for pulling a cork from a bottle may not be as important as creating a balanced cocktail comprised of five or six diverse ingredients.

They have not only missed a seismic shift in an important market demographic, they still have not recognized it. Masking this grasp on the realities of the marketplace is a coming shortage of wines due to lower harvest yields in 2010 and 2011. They may, however, experience a startling Rip Van Winkle moment when the anticipated high-yield 2012 harvest hits the sorting tables. Plenty of product chasing fewer consumers than they expected.

This was all brought “home” to me on a recent visit to Sonoma County. Great place to make all kinds of fine wines. All-day-long wine talk with people who are proud of their efforts, and rightly so. Then we sit down in the evening at a fine restaurant to enjoy more conviviality and some beverages. I order a French 75 cocktail, a drink that just about every bar in New Orleans is adept at constructing.

Not only was the waiter confused by my order, with the same feeling hitting the guy behind the bar, but winemakers at my table were asking a lot of questions. And they were pretty basic questions about cocktails. It’s good to ask, of course, and I answered as best I could; but they don’t have a good grasp on what their audience in the hinterlands is drinking, and it’s not always wine.

This was further brought home by someone at a winery who indicated to me that he had, surprise of surprises, just created a new bartenders’ mix that everyone in the industry (out there) was going crazy over. When I asked him what was in it, it did not sound all that complicated to me, nor did it sound particularly innovative. But at least he was trying.

Then I ran into a bartender in Healdsburg who had created his own Bloody Mary mix and was marketing it. He also was a very good bartender. He seemed oddly out of place, which means quite knowledgeable about a wide range of cocktails, for what I had been experiencing. I asked him if he was a native Sonoma County guy.

He was not, and had done a lot of traveling around. So where did he learn about cocktails and how to make them properly? Time well-spent in New Orleans was the answer.

Big surprise there. Not!

Point is, for winemakers, wake up! The market has changed. Educate your audience. Get them excited about what you do and where you do it. Find additional uses for your products, like cocktail ingredients. It’s not denigrating your product, it’s expanding the usefulness. It’s becoming more market-friendly.

It’s reaching the audience where they want to be reached and when. Otherwise resign yourself to being a great accompaniment to a meal. Know that, before the first course, some mixologist spins gold from high-proof ingredients.

                                                                          -30-