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Exorcising Diffident Demons

I’m mad.  I think our economy is getting better and I am not happy about it.  Our economic distress has NOT affected enough positive change, wrought through hard times, the equivalent of my grandparents, Depression-era influenced, saving money under the mattress, hiding it in the freezer and under the sink in coffee tins because they didn’t completely trust the banks.

What a blown opportunity to create life-altering change for the peccadilloes that inhibit positivity in our wine world.

Wine is the New Black

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It is official.  Wine is the new ‘Black.’ Wine ‘Plays in Peoria.’

‘Will it play in Peoria?’ has traditionally been asked, somewhat rhetorically, to determine if something will appeal to heartland/Main Street America.

The results are in.

In a recent Wine Market Council report highlighting Nielsen research (as presented in Wine Business Monthly), Indiana, Ohio, Michigan, Wisconsin and Illinois, cultural flyover states if ever there were any, all demonstrated exceedingly positive growth over three judgment time periods – a year, 6 months and 3 months in 2008.

For example, total dollar sales for wine in Indiana increased 16.7% over 2008.  Total dollar sales for Wisconsin grew 24.5% over the last six months of 2008, and Illinois grew 27.6% over the course of the year—explosive growth by most measures.

This is great.  It’s hard to underscore how relevant this is to wine culture at large.  If wine growth is exploding in Indiana and Wisconsin, you can be sure it’s a trend and not a fad.

And, while I appreciate that my region of the country has decided to come to the wine dance, I fear that our contemporary wine culture will not have a long enough period of time with reasonable price point wines and expectations that normalize the population before the recovery.

The unfortunate result of this is the fact that we will go back to our near-term old way of doing things.

That is, our wine culture will still be skewed towards reflecting approximately 2% of the population while the other 98% of the wine drinking world scratch their collective head trying to figure out what they are missing.

California wines will go back to aspiring for that $18 – $25 price point, allocation wineries will be aloof and cult wines will continue their ascent up the price ladder, all while we breed another generation with a contemptible view towards wine, supported by popular media that paints by the proverbial point with a bent towards lifestyle.

Excuse me if, in a microcosm, I feel like the we could use some more suffering to get our domestic wine culture to healthy place to grow from.

Restaurant Wine, Gouging Customers since time Immemorial

The old grind has always been that corkage fees are out of whack or non-existent and that restaurant wine prices are too high.

This conversation has been going on for decades.

And, you know what, corkage fees ARE out of whack or non-existent and restaurant wine prices ARE too high.

Generally speaking, I don’t care much about corkage fees, etc.  I don’t take a sandwich to a picnic, or sand to the beach, so the notion of taking wine to a restaurant, or not, isn’t that big of a deal to me.

However, I do get peeved, really peeved at restaurant wine prices.  So do a lot of other people, as well. 

I’m taking a couple of days off in Florida with my wife and some friends.  I order a dozen oysters on the half shell and a glass of Sauvignon Blanc.  The wine, Kendall-Jackson, the lesser of evils on the wine list, is $9.50 a glass.  A glass!  A bottle retails for about $11 at retail. 

Are you kidding me?  That furrowed brow of mine doesn’t magically spell out “dumb” like some consumer crop circle within your kitschy, purposefully low rent seafood shack.

Does restaurant wine pricing get under my skin?  Sarah Palin is the anti-Christ to me, but to borrow a phrase, “You betcha” it bothers me.

The argument is that restaurants make most of their profit on the bar and desserts, so wine pricing is a mechanism of making up for loss leaders or break evens on the entrée.

Arguments have long been developed that more wine would be sold if it were more reasonably priced.  Evidence today indicates that the high-end of restaurant wine lists are growing dusty, while more people are buying wine by the glass, which have typically been priced so that a glass pays for the wholesale cost of the bottle.

With an economic recovery, expense accounts will loosen, disposable income will free up and more wine will be purchased without ANY change in the habits of restaurants.

That’s too bad because we’d be better off if entrees were priced sustainably so that wine didn’t have to have a 2.5X mark-up on a bottle.

Personally, what I want to do is start a consumer groundswell movement, and use RFID tagged customized casino chips that you can leave with your restaurant receipt.  The chip would say, “I didn’t buy any wine because your prices are inflated.  Tell your manager that your tip is smaller because their pricing practices inhibited my desire to enjoy wine with my dinner.”

Call it the ‘Consumer Coalition against Restaurant Wine Price Gouging.”

These chips would be free to anybody that wants to order them.  The RFID chip would map online into a Google map indicating where they have been played and the entire web site would use the API from Yelp.com where people can go after a chip has been played to detail their experiences about wine price gouging.

Likely, this idea goes into the pile of other ideas of activism that get relegated to the prioritization of time and money – notably my time and money, but just the same, something should be done, even if the economic times aren’t going to cooperate with us to create impactful and lasting change.

Related to wine, what are your diffident demons?



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Posted in, Good Grape Daily: Pomace & Lees. Permalink | Comments (9) |


Comments

On 04/07, Arthur wrote:

Hi Jeff

I did my general medicine internship in Peoria. It’s a lovely place.

None of my friends who stayed there (and with whom I am still in contact) give a damn about wine.

I would not pop the celebratory cork on the economy just yet. Keep an eye on the unsecured credit (ie credit card) industry.

On 04/07, .(JavaScript must be enabled to view this email address) wrote:

The damage done to the economy is such that even if a “bottom” has been reached (and that is not clear at all) it will take AT LEAST 3 to 5 years to fully recover and very likely longer. Our hyperventilating bi-polar media cannot be trusted to accurately gauge and responsibly report the true
economic situation.

Restaurant wine pricing is CRIMINAL. I’m certain that some will close rather than lower prices to levels that could spur
sales.

On 04/07, Dirty wrote:

Wine sales are up?

It would be tough to find a winery or wine merchant that would agree with that.  The only up numbers I’ve seen have been in the sub $6 range (which also includes MD, Boones, and fortified). Go above that and the market is in the total sh*@ter qwitter.

I disagree.
—Restaurant wine prices are not criminal. 

—Any corkage fee is fair.

As long as we have a choice, restos can charge what they want (and probably charge as much as they can get).  A lot of people happily pay these ridiculous prices. For the resto it must make some sort of business sense to keep pricing as is vs to reduce cost and sell more wine (Cost of inventory? Show higher margin? Cash flow? Who knows?)

BTG programs have almost always priced a single glass near or even above the wholesale cost of the bottle.  It is crazy to me, but if the general population continually pays it, it can’t be all that crazy.

Corkage is a privilege and not a right.  Due to pricing, I rarely buy resto wine, but I do factor corkage fees / policies into where I decide to eat, and sometimes into what I chose to bring.  Again, if it makes sense to keep me away with steep fees, so be it.  At least where I live, I have plenty of choices.

We make up a tiny piece of the consumer base.  For many restaurants, it makes more sense to lose us as customers than to lower pricing.

On 04/07, Jeff wrote:

Gents,

thanks for the comments. 

Ned, I agree that the media is bipolar, but given that I’m in the frontlines, I can attest that the economy and indicators from a B2b perspective are definitely pointing up as we head into Q2.

Hardy, wine sales are up—unfortunately, it’s not in the luxury category.  Given our wine enthusiasm, you and I forget that there are tiers of price categories for wine that culminate with super-premium at the $12-$15/$18 price marker.  Prices above that are called luxury.  It’s the luxury market that is hurting.  Other wine sales are doing just fine.

given your ties to many restaurants, I’m not surprised that you’re an apologist, but, really, 2.5 to 3X wholesale is criminal. 

Selling somebody something that they know they can buy elsewhere for 2.5X less money is a crime.  A crime of captivity.

Is it not?

Jeff

On 04/07, Dirty wrote:

Jeff-

I’m not an apologist at all, I just don’t think it is criminal. Captivity would be if we have no choice on whether or where to buy.

I refuse to pay those prices.  But most people do and will.

On 04/07, Dr. Horowitz wrote:

I feel kind of the same way about the wine marketing world.

Not enough change has happened.  It seems like most wineries still have a marketing manager making six figures who pays someone $20/hr to use social media/the Internet to promote a winery.  I think wineries will soon start to produce more multimedia content and deliver it via social media/the Internet, but not until things really change.  Maybe they’ll read Vaynerhcuk’s book and by next Summer we’ll be complaining about stupid winery blogs.

On 04/08, Tim wrote:

I’m with you on the bloated wine prices at restaurants.  (I am the cheap wine guy after all).  They need to consult with some marketing folks to find the sweet spot in the volume:price ratio… and to leverage lower wine prices as a differentiator.

My other gripe at restaurants is wait staff that don’t know how to use a corkscrew.  I can’t tell you how many times I’ve wanted to take it from them and teach them how to do it right… not to be mean, just to help them out.

On 04/09, Dylan wrote:

I agree with Dirty on this. There’s options and they are a private establishment. If people are willing to pay for it, it only validates their ability to charge that amount. The only way to make a difference would be for consumers to openly ignore giving business to these restaurants and show that it’s because they do not price their wines properly. Otherwise, where is the imperative for change outside of their own scruples?

On 09/23, Viking stove repair wrote:

An auto-defrost unit uses a blower fan to keep moisture out of the unit. It also has a heating coil beneath the evaporator that periodically heats the freezer compartment and melts any ice buildup. Some units also have heaters in the side of the door to keep the unit from “weeping”. Manual defrost units are available in used-appliance shops or by special order.


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