Sideways: Courtesy of Fox Searchlight Pictures

Headline: B-Rated Movie Thrashes Bordeaux Classic

How A Wine Industry Reeled From Sideways, The Movie

Merlot, the classic French Bordeaux fave of which 66% of the 280,000 acres of France’s top reputation wines originate, is Merlot (yes I said 280,000 THOUSAND acres [Napa Valley is 45k acres]). There is more Merlot in Bordeaux FRANCE than there are total acres of grapes in the entire Napa Valley, in fact, 4x the acres of ONLY Merlot.

“Waaaat!? I thought Merlot was crap because I watched this movie in 2003 that everyone told me I had to watch because I wanted to learn more about wine?”

This is where the psychosis begins……..

from sweetheart to cinderella’s step-sister

In 2003, Merlot was the sweetheart of red wine sales in the US capturing roughly 18% of all wine sales (as opposed to Cabernet S. at the time at roughly 8%, supposedly the ‘King of Reds’).

Merlot, from a growers perspective in CA, was a fairly easy grower, not as thick skinned as Cabernet Sauvignon, was a little more susceptible to disease and pests such as powdery mildew and ‘mealybug’ (yuk! you don’t even want to look at a grape cluster infested with mealybug….believe me), and had a world class reputation of being a great grape, producing fruit-forward medium-bodied red wines.

Descriptions of good Merlots from California were described like this 1999 Pahlmeyer, Napa Valley:

“A mouthful of wine that packs in lots of rich, deep, plush and concentrated flavors, with tiers of currant, blackberry, raspberry and wild berry fruit. Well-integrated tannins smooth out the finish.” ~

James Laube, Wine Spectator, October 2002

&

"Impenetrable and inky – purple in color, the nose offers aromas of ripe, smoky plum, cherry, anise, oak, and port like sweetness. The palate is full bodied and structured with a finish that has length and intensity." 

~ Erin Green, Winemaker September 2001

So what happened?

What do $5,000 per bottle wine vineyards look like? Petrus, Pomerol, Bordeaux Franch. One word, “Excellence”

In 2003, US wine consumers were going through a very fast wine-learning curve. Most consumers really didn’t know much about wine and some of their biggest memories came from the ‘wine cooler’ era of the late ‘80’s. White Zinfandel (taboo to the wine snob) was still something like 22% of the total market share of wine consumed in the United States (not to mention the EU’s rising love affair with it, of which we called ‘Vin Rose’ in the 70’s).

Along comes a “B” rated film (you know the one) that takes poor Merlot, slams it up against a wall, kicks it to the curb for the movie’s favorite, ‘Pinot Noir’ (yes, of Royal lineage) and literally overnight nearly SINKS the reputation of California Merlot, fast-pacing it down to under 10% of wine consumption in the US. Whoah! Merlot overnight becomes a worthless commodity for a large part of the market and Pinot rises to meet its destiny among the jet-setting wine aficionado’s of America. (growing from 2% to over 7% almost overnight)

Petrus - A giant among wines

Being blown away by this b-rated phenomenon, I was so irate as a commercial winemaker (with 100,000 gallons of bulk Merlot in tanks, now un-sellable), I wouldn’t even go watch the movie! My thought? “You are kidding me! Petrus (95-100% Merlot) is one of the most highly regarded wines of the world, selling at upwards of $4,000-$5,000 per bottle and we’re now saying ‘Merlot is a has-been!?”

Ah, yes. The power of media to sway the minds of a consumer. Almost ‘magically’, Merlot hits a rock bottom and Pinot Noir skyrockets into fame (BTW, it IS worthy).

The fact is, that more ‘mediocre’ Pinots were being made in the US at that time than mediocre Merlots…..so the facts of the movie were, well, ‘just storyline for entertainment’. Who knew that it would take such a toll on an industry, shifting the entire focus of red wine production, nullifying the value of one grape and accentuating the value of another instantaneously.

Miles, now infamous for his one-liners regarding the quality of California Merlot

Merlot vs. Pinot:maturing our palates

In an era of consumers identifying marketers and advertisers as ‘liars’, it can be tough to get across your message when everyone thinks you’re just trying to “sell them” (Read ‘All Marketers are Liars’ by Seth Godin). So what do you do when you really have something good to sell being drowned out by the ‘noise’ of every other Joe selling their wares?

How about you seek out someone with long term experience? Well, maybe that doesn’t always work (noting our current political races these days). How about you look for that fresh face with youthful ideas and fun product designs? Yeah, but then again, new ideas without great experience end up with much greater risks that the ‘new’ organization or product may not be around very long.

Here’s the point; there has to be both. Both experience and youthful ideas and energy and great quality (excellence)…….and we’re talking about maturing our ‘business palate’ that we are prepared for B-rated movie phenomenons to change our wine world approach. Hey, think about it. Retailers made a quick change and instead of buying more Merlots at great pricing (and some really good ones), they started buying up what ‘people were asking for’ from a dumb movie….ok, yes it had some funny one-liners.

In the end, those who were able to adjust quickly were positioned to take advantage of an instantaneous advertising schema using a B-rated movie platform to build a business!

two-buck chuck, planting booms & international trade

perfect storms

So, here’s this new phenomena of Pinot Noir taking center stage. An immediate response from one of the largest California wine producers responding by planting massive amounts of Pinot Noir in the Central Valley of CA to dominate the new demand of Pinot Noir on the shelf space. Yup, they were successful in plating and responding to the Pinot Noir craze with one problem:

The Pinot Noir grapes being planted & grown were ‘generic’ grapes destined for ‘generic’ wine of which the entire premise behind the what may be the greatest movies’ one-liner “If anyone starts drinking Merlot, I’m leaving!!” (or another one liner I won’t repeat, watch the clip above), ended the popularity of Merlot and placed Pinot Noir, and many say ‘rightfully’ so, as the Queen of Red Wines for all time.

Now, here’s an oversupply issue with Merlot plantings in California in 2004-5, the CA wine industry is reeling already from all the plantings that took place between 1992-2002, and in fact a massive sea of vineyards were planted during this time (Lodi alone planted upwards of 60-80,000 acres during that time, I think Sonoma doubled it’s acreage in the same period, the Central Coast came alive with major plantings in Paso Robles and San Luis Obispo County).

from one phenomena to the next:beware of bait & switch

Along comes ‘Charles Shaw’, a Napa wine program purchased from Charles Shaw by Bronco Winery and ends up selling millions of cases per year through the Trader Joe’s specialty chain across the US. In addition, the still massive oversupply of wine in CA resulted in major exports of bottle-ready bulk wine being shipped to the UK, Germany, France and other parts of the EU for VERY low pricing, initiating a major new appetite for CA wine around the world.

Merlot - the most expensive wine in the world is a big loser!

For growers in California, Merlot has become mainly a ‘generic’ red wine selling for mostly low pricing on the US retailer shelf. It has long since lost its luster as a sweetheart of the consumer world (thanks to the movie clip above) and has all but died a nondescript death in the annals of California wine.

Fast-forward past the 2005 wine glut (having been one of the largest vintages in Ca. history) to 2008-10. What a roller coster! Right when you got to the point of, “ok, that’s over”, 2008 hits in the US economy and literally draws the life’s blood out of any chance for a booming wine-recovery. Little encouragements of increasing per-capita consumption, an appetite for wine in China, the EU and Canada, made a small impact, but pricing……well, it sucked (to put it mildly). Wineries in California were selling 100,000 gallon lots of bulk wine for $1.00/gallon and sometimes less (in fact one-such sale of a Napa Valley Chardonnay at 75 cents/gallons made it into one of those $2 wine programs garnering a 92 Wine Spectator rating solidifying the slogan “bad ratings die fast but great ratings live forever!”).

Merlot, this grape of greatness in Bordeaux, now sitting as a generic red wine blender on the bulk wine market in the US for pricing well below the ability to grow the grape and make wine for a profit. The entire world with its hand out asking for $2 wines from California had effectively removed much of the luster and impact of the 1976 Paris Tasting (the phenomena that led to the reputation boom for Napa Valley and California wines).

Yes, it was and is true, that is, that many California producers are producing products that my small-lot winemaking friends would say are not worthy of the name “wine”, but that being said, so are many of the cheap Italian and French wines flying off our US retailer shelves.

Disneyland, or rather the reputation of excellence in service, quality of entertainment, professionalism and integrity are marks of a great organization.

Regaining composure: reputation & Quality

One word: Excellence.

Excellence in Quality; Excellence in Presentation; Excellence in Professionalism; Excellence in Integrity.

This is the way to regain reputation composure from the effects of a low budget (yes, at times, funny) B-rated movie phenomenon and place an industry back onto a trajectory of greatness!

Excellence! This is where I’ve failed….or cut corners……or simply let this ideal get set aside for the “immediate need”. This is where most of my friends and their businesses suffer. At whatever price point; Excellence.

Commodities respond to B-rated movies. Excellence is defined outside of the scope of commodity ideals.

As a winemaker and life-long trader of wine, I am stupefied by the actions of those try to portray ‘generic’ products or services as ‘world class’ trying to compare the legitimacy of “Pinot Noir” from the great Burgundian vineyards of France or California’s Russian River or Petaluma Gap with the wines made from grapes grown in Fresno or Bakersfield.

Don’t misunderstand me, there is a place for those wines and there is a need for making ‘less expensive’ products, but where movie punch-lines are made and reputations are won and lost is when cheap quality, cheap presentation, lack of professionalism and low integrity visits an industry as though a ghost, having a resultant effect of that of a scary movie or literal haunting.

In the world of wine, as in just about any other service or product business, a brand is all about reputation and reputation is all we have when it comes to consumers, citizens and the relationships we have with one another. When we make poor quality products or our integrity is low or our presentation is less than polished, we make our products fodder for B-rated movies to monetize our lack of excellence…….and the result. The “Consumers” laugh.

One word: Excellence. It is the tool, the ammunition, the beauty, and the focal point of what makes life enjoyable and worthy to be lived. The legacy of who we are, the industry we represent and the product & services we produce will go down in history as either a B-rated plan to produce revenue or a ‘establishments of excellence’. The choice is ours.

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Nicholas Karavidas is owner and winemaker of Élever Vineyards & OneMaker Wines, Principal Consultant for Consulting Wine, Intl. and the Designer of Wine & Food Pairing tool “Flavor Shapes”. 2020 marks 40 vintages of wine production as a winemaker with the majority of his time designing and managing winery designs as well as vineyard and wine family business strategies. If you can’t find Nick analyzing wine, you will certainly find him analyzing his market, reading more on technical topics of wine & wine marketing, the impact of international trade on his craft and last but certainly not least, how to be a better father and husband to his wife Heather, his 6 children and 8 grandchildren.

Purple Happy - Notes from Winemaking’s Edge

“Oh the harvest of 1980……I was 18, filled mostly with singular thoughts of the best surf, ski or skateboarding move…or how much money I needed to earn to get to Mexico for the weekend to eat lobster burritos while surfing K-38, a popular surf-spot for ‘gringos’ 38 kilometers south of the US boarder. Those first harvest shifts were filled with the act of scrubbing the purple stains from my hands after handling red wine grapes….in fact 1,000’s of tons of grapes, and learning how to flush wine hoses from tank to tank by ‘slurping’ the dripping wine from transfer hoses to determine when it was time to close the valves…..and it was also the year I discovered a few ‘dirty little secrets’ about commercial winemaking.”

~ Nicholas Karavidas, Winemaker/Proprietor

Surfing Newport Beach jetties in the late 70’s, early 1980’s

“The most beautiful gift of nature is that it gives one pleasure to look around and try to comprehend what we see”

— Albert Einstein

The Psychology of Color

Not long into my juxtaposition of surfing & wine, I checked a book out of the San Bernardino public library called, “The Psychology of Color”. My interest was to understand the impact of colors and color combinations on the human mind, most importantly on the minds tendency to respond to colors in advertising. I was now 21 in 1982 and as a young winemaker, I had other passions…..mostly adrenaline focused sports such as Alpine Skiing. In an effort to create an effective flier for a ski trip that I was sponsoring, I stumbled upon this concept of how impactful color was on the human psyche.

Boom! I was awestruck at this idea. Why were the fast food giants of McDonalds and Burger King all arrayed in Red and Golden-Yellow? Because that was the most effective color combination known to capture the attention of a consumer and bring them in! No brainer……but wait. How do all the other colors affect the human mind and that of ‘human decisions’? Sweet success, I discovered a new love: the marketing impact of colors in advertising bit me like a surprise scorpion in my sleeping bag!

For you wine tech geeks, technical compilations like this one are among my most treasured library pieces.

““Messieurs, c’est les microbes qui auront le dernier mot.” (Gentlemen, it is the microbes who will have the last word.)” ”

— ~ Louis Pasteur

Hedging Your Bets…..Why Color?

Studying color has led to many other discoveries. Color isn’t just color…….color is so much more when attached to the topic of wine chemistry. In an article in “Chemistry of Wine Flavor” (photo above), “Phenolic Composition as Related to Red Wine Flavor”, the authors expound on the dependency of phenolic composition for overall wine quality. Particularly how color associated compounds such as ‘anthocyanins’ (think cyan [blue]) combine with other compounds to build greater, fuller or rounder mouthfeel. The science isn’t simple but we can simplify some of the jargon to simply say, “Color isn’t just Color”. Color is mouthfeel, color is tied to aroma compounds and anti-oxidant values to protect the wine in the aging process. Color is anti-bacterial and so many other things so it’s hard to ‘pigeonhole’ color into just being a visual thing that is pretty or deep or a ‘hue’.

This blog is beginning with this topic as it is timely in the commercialization of wine and the consumer’s attention to wines color, specifically red wines, whereas there is an automatic connotation regarding depth of color to associate it with overall quality of the wine as a whole….and this is not altogether wrong or inaccurate, it is simply correct……and not so correct. The fact is, deep colored red wines have become a driver of consumer acceptability and therefore attractive to the commercial buyer.

Delivering high quality, deep-colored wine at a low consumer price has become a driver in the marketplace creating an environment where winemaker ‘toolbox tricks’ now proliferate.

So Why “Purple Happy”?

So the consumer tastes a wine that is ‘really, really’ tasty….and the color is deep and laden with oak character and the Somm’s rate it high and the buyer places it on the shelf and then……the average consumer can’t afford……say, “Booker” or Dauo from Paso or Far Niente, Phelps or Cardinale or any number of $100+ wines, the descriptors invariably describe something “dark”. Black cherry, roasted leather, boysenberries, black raspberries, etc. There is an overwhelming majority of these highly sought after wines that are simply ‘big’ and big means deep color and tannins and rich and ripe and concentrated.

Deep red and purple are colors that we tend to see most notably. Without getting into the hue variances of different red grape varieties (Merlot has more of a blue hue, Zinfandel more red), producers of last 10 years have begun to utilize what I would call “toolbox tricks” of using wine grape concentrates to align less expensive wines with their very expensive counterparts….at least in the ‘darker color’ department. In this effort, many have overdone a “good” thing with using so much of these color concentrates, that the wines produced with them can literally stain your glass and your teeth dark purple……unnaturally so.

“…producers of last 10 years have begun to utilize what I would call “toolbox tricks” of using wine grape concentrates to align less expensive wines with their very expensive counterparts….at least in the ‘darker color’ department.”

Purple is happy…purple is ripe…Purple is good

But there’s more to this. Let’s go back to the “good” of what color really is in a wine. This would be the same for the topic of oak character in $10/bottle wines. It is literally impossible to produce wines from high quality grapes, age the wine in new oak barrels and sell the wine for $10 or less a bottle. So how do we get to “Good” in this outline? Deep color in wines is an attractive attribute in which sommelier's and critics recognize as ‘good’ so long as it is ‘real’ color. The problem lies in this analysis that the color concentrates are ‘real’ grape concentrates from wine grape varieties that have very deep red or purple pigments to them. Historically, the varieties we used before these ‘color concentrates’ (and still today when not using concentrates in more expensive wines) are varieties like Petit Sirah or Petit Verdot or Alicante Bouchet or going even further back in time, Salavadore.

Purple, or dark colors have an impact on the human psyche as much as the visual color depth has an impact on overall quality of wines. Simply put, purple makes us happy. Purple is a happy color. Purple is a color of royalty and gives us a senses of pride and accomplishment. Purple and dark red hues are signs of strength as well as physical-chemical contributors to overall quality and, depending on the price of the wine or the consumer’s pocketbook, there are many ways to acquire color, and I would argue, ‘legitimately’.

Although a consumer is not going to find a lot of ‘tool box tricks’ in wines of $30-$50 or more but for the wines that you might find ‘delicious, ripe, jammy, concentrated’ or even having the ‘umami’ effect in the $10-$15 range, natural and pure grape concentrates can and will certainly enhance the quality of lower priced wines without falling into the category of ‘natural and artificial flavors’…….that, my friends, is another “Purple Happy”.

Deep color is an attibute of fine wine, historically high valued materials, and has always held a value as “rich”.

Nicholas Karavidas is owner and winemaker of Élever Vineyards & OneMaker Wines, Principal Consultant for Consulting Wine, Intl. and the Designer of Wine & Food Pairing tool “Flavor Shapes”. 2020 marks 40 vintages of wine production as a winemaker with the majority of his time designing and managing winery designs as well as vineyard and wine family business strategies. If you can’t find Nick analyzing wine, you will certainly find him analyzing his market, reading more on technical topics of wine & wine marketing, the impact of international trade on his craft and last but certainly not least, how to be a better father and husband to his wife Heather, his 6 children and 8 grandchildren.