Studying for an WSET test on the impact of critics in the wine industry+ a new NFL award

12 Jun

Tuesday morning I took a test in San Francisco as part of the Diploma program for the Wine & Spirit Educational Trust.  Going in we knew that the topic would have something to do with wine critics, Robert Parker in particular, and how thy impact production and consumers.  It would probably also have something to do with how the role of the critic has changed.  We would get the question and then have 75 minutes to write a paper about it.  We wouldn’t have access to any notes.

I figured that one way to study would be to write a general essay that covered all of that.  That way, it would just be a matter of trying to put the same information back down during the test.  As far as helping me study, I think it helped.  I didn’t have any trouble remembering enough for the test.  My real problem was that it was done with pencil and paper, which seems insanely antiquated these days.  The hardest part for me was trying to keep my handwriting semi-legible while my hand cramped as I tried to write as fast as I possibly could.  It seemed more like a test of how fast you could write than how much you knew about the subject.  It was the same for everyone though.  We’ll see how I did in a couple of months.

Here is what I wrote as a study exercise.

The relationship between consumer, wine media, & the industry

How has the role of the wine critic changed over the last few years?  What, if any, power does Robert Parker or the Wine Spectator hold in the wine business today?

Robert Parker When Robert Parker started his Wine Advocate publication in 1978 the wine world was much simpler.  Parker frequently notes that Vega Sicilia, which he touts as the best wine in Spain was not even available in America in 1978.  The number of wines on the shelf in general was much smaller than what is available today. Eric Asimov, wine critic for the New York Times wrote “If you could transport yourself back to 1982, you’d find a much more constrained world, where great wine meant Bordeaux and Burgundy, with perhaps some Champagne thrown in. The Rhône? In a great shop you might find Rhônes in a section marked “country wines.’’ Italy? Straw bottles of Chianti, perhaps some dusty bottles of Barolo and a lot of awful Lambruscos and Soaves. California? Just moving out of the jug wine era into the age of white zinfandel.

Except for the great names, wine was still largely a local business. As had been true for centuries, most of the different wines of the world would be sold within 100 miles of where they had been made.”

Huge wine chains like Total Wine & More & BevMo! were years in the future.   America was still recovering from the effects of prohibition, but thanks in part to the success of the Judgment of Paris, was primed to learn more about wine.

Robert Parker’s real breakthrough came when he declared the 1982 Bordeaux vintage to be excellent despite the mainstream of critics believing otherwise.  Their feeling was that the wines were overly ripe with too little acid.  Ultimately, Parker’s view was accepted fairly quickly and this brought him worldwide attention.  Thirty years later Eric Asimov wrote in Time Magazine that the 1982 Bordeaux vintage was “possibly the most significant wine vintage ever.”

Another person who saw an opportunity in the wine recommendation business was Marvin Shanken.  He purchased The Wine Spectator in 1979.  It had been founded as a tabloid newspaper in San Diego in 1976.  Shanken had a different approach than Parker.  While the Wine Advocate was a very straight forward no frills listing of wines with reviews & no advertising, The Wine Spectator became a slick lifestyle magazine with plenty of ads.  It reviewed wines of course and adopted Parker’s 100 point rating system, but the reviews were just a part of the magazine.  The Wine Spectator featured travel guides to wine regions, interviews with wine makers, and recipes for wine pairing among many other aspects of a wine lifestyle to which most Americans had never been exposed. In 2008 the Luxury Institute named the Wine Spectator as the #1 business and consumer publication among wealthy readers.

There have been other publications and other critics who had a strong voice in the market place.  The Wine Enthusiast, Decanter Magazine, Eric Asimov at the New York Times, Steve Tanzer at International Wine Cellar, & Jancis Robinson have all had influence.  None of them have been as widely quoted or as powerful as Parker & the Wine Spectator.  In particular, Robert Parker has had an impact on the way that wines are sold and even on the way that wines are made around the world.  I believe that the impact has occurred on the retail and the en primeur portion of the market, and that it then began to transform wine making itself.

The immediate impact of Parker’s rise to fame and influence was on the en primeur market in Bordeaux.  The idea behind the en primeur market is that customers can buy wine while it is still in barrel.  This is helpful to the buyer because they can get access to wines with limited production and in the case of an excellent vintage (or positive changes in currency rates), they can sometimes buy the wine for less than it would cost by the time it is bottled.  For the producer, cash flow is the primary advantage.  They get paid as much as 18 months before they bottle the wine.  In the wine business as in any business, cash flow is king.

Political scientist Colin Hay did a statistical analysis of the en primeur Bordeaux market prices and concluded that Parker ratings alone caused a 50% increase in the release price between 2004 and 2005.  In 2002, due to concerns about potential terrorism, Parker did not travel to Europe to do barrel tastings.  That meant that wineries had to set their prices without knowing the Parker scores.  Michael Visser and colleagues crunched the numbers and in the June 2008 issue of The Economic Journal they reported that prices were 2.8 Euros per bottle cheaper than they should have been based on his later reviews.  I looked up the exchange rate at the time & that is roughly a $14.16 difference per case.  Multiplied over thousands & thousands of cases, that adds up to quite a bit.

The next place where Wine Advocate and Wine Spectator reviews make a difference is in sales & price at retail.  Wines that receive a score of 90 or more are virtually guaranteed higher and faster sales on that vintage.  Additionally, they have some ability to raise the price on the next vintage.  A good review from Robert Parker might feel like a gift handed down from Zeus.  Adam & Dianna Lee moved from Texas to California to start Siduri Winery.  They only had $24,000 and didn’t own any vineyards.  Their first release in 1994 received a 90+ rating from Robert Parker.  The attention allowed them to sell futures (American style en primeur) on their next vintage.  That cash infusion allowed them to buy more grapes and build their brand to the point where they produce 7,500 cases a year with as many as 20 different wines (primarily Pinot Noir).

In an interview in The San Francisco Chronicle, Kim Beto a vice president for the large distributor Southern Wine & Spirits said “Every sommelier in the world will say, ‘I don’t care about ratings.’ But they won’t buy (Joseph Phelps) Insignia until it gets 100 points. Then they beg for it.”  According to a 2001 study of Bordeaux wines, a one-point bump in Robert Parker’s wine ratings averages equates to a 7% increase in price, and the price difference can be much greater at the high end. The Olive, Spain’s largest daily English website wrote that a Parker score of 95+ has been calculated as worth 7 to 8 million Euros to the winery.

When a winery knows that pleasing one person can make them an extra 7-8 million Euros (or almost 9.5 million U.S.), they have a lot of incentive to please that person!  That is where Parker and the Wine Spectator (particularly James Laube) began to change wine. According to multiple reports, the quality and cleanliness of wine making has dramatically improved since the mid 1970’s.  Some of that change has come because of advances in technology.  Some of it has been directly related to the greater attention that the critics in the media have placed on wineries. When wineries are trying to compete in a world market rather than with just the local wineries, they have to stand out.  Parker & the Wine Spectator gave them an opportunity to stand out, but they had to earn it.  “There’s no doubt that the 100-point score has played a role in the growing popularity of wine,” “Over all, it’s been one of the most important things elevating the quality of wines around the world,” said Jon Fredrikson, a wine consultant with over 40 years of experience in the wine business (New York Times 2006). “Producers care about their scores.”

It is a good thing when the critics help lead wine makers to higher standards in the production, packaging, and preservation of their wines.  The problem that I see is when wineries try to emulate a single style that they perceive will gain them high wine ratings.  I mentioned earlier that the 1982 vintage in Bordeaux was considered by some critics as over ripe & under acidic.  It turns out that this seems to be exactly the style of wine that Robert Parker and James Laube prefer.  They enjoy other wines, but the ones that get the best ratings tend to be wines with big upfront fruit, heavy French oak, and soft tannins.  Those can be great wines, but sometimes it is nice to have something different.  There is a suspicion that a worldwide style is developing to promote this one approach.  Many critics have lamented a homogenization of world wine production.  Parker isn’t the only person blamed for this.   Michel Rolland one of his favorite wine makers, consults for over a hundred wineries & brings this style with him when he comes on board.  Of course Rolland probably wouldn’t be as powerful if he had not been championed by Parker.  One wine consultant who is upfront in helping customers target a high Robert Parker score is Leo McCloskey.  His company, Enologix, promises to assist wine makers in boosting their average national critic’s scores.  He has said in multiple interviews that the typical winery signing up with Enologix achieves a five-point rise over its previous year’s average scores for red wines and a six point increase for white.  In a New York Times interview with Dave Darlington, McCloskey is quoted as telling a client ”Your grapes are growing at Style 3,” ”That’s the pitch your terroir is throwing you. But Parker, Laube and the consumer are at Style 4, so you need to ask yourself, How can I get my wine stylistically in the right ballpark?”  That question encapsulates everything that people who worry about wines losing a sense of terroir fear.  Instead of working with the micro climate that you have to produce the right wine in the best style for your vineyard, the goal is to manipulate the fruit or the juice to make the wine in a generic style.  McCloskey isn’t the only person doing this.  He is probably just the most upfront about it.  The San Francisco Chronicle interviewed wine consultant Barry Gnekow.   “I say to winemakers all the time, ‘You’re only as good as your last score,’ ” Gnekow says. “You’ve got to follow the basics. Number one, you’ve got to make a good-quality wine.  “The first entry into the venue is expensive French oak barrels. You’re not going to get the scores with American oak. That’s what (Wine Spectator‘s) Laube and Parker taste all the time — wines aged in expensive oak barrels. The next step is letting those grapes get really, really ripe. That gives the wine power, oomph, really big body. The consequence is high alcohol.”

One of the responses to people who criticize chasing Parker points is that the wines sell.  This is manifestly true.  People like to buy highly rated wines.  That high rating is an effective stand in for a wine clerk who knows his business.  There are certainly great wine advocates in some retail stores.  I love talking to those people.  Unfortunately you are much more likely to be standing in a lonely aisle with no help at all.  From about 1980 to 2000, the main thing to help you make your wine choice for the evening was the shelf talker under the bottle.  The 100 point system made it easier than reading a complex review with phrases like “an aggressive wine with granular tannins and an almost petulant streak of chicory.”  Instead it said “90 points Wine Spectator.”  You could look at a row of wines & say, “well this one got an 85 & that one got a 90.  I’m buying the 90.”  Wine Spectator made it easy for retailers.  They sent out the scores & a sample sheet of shelf talkers to print a week in advance.  That gave the retailer time to stock up on the highly rated wines & to get the shelf talkers in place.

In recent years I believe that the wine market, like almost every retail market has undergone a seismic shift.  Parker & Wine Spectator still have power, but the real review power has shifted to the internet.  I don’t mean wine reviews on blog sites like mine are changing anyone’s buying habits, although I am sure some bloggers have some influence.  The real influence is the aggregate reviews of regular wine buyers. It may take a while before retail stores grasp it, but people are buying in a different way.  According to an October 2008 survey by Penn, Schoen & Berland Associates, a research and consulting firm, 70% of Americans say they consult product reviews or consumer ratings before making a purchase.  Amazon.com, which now sells wine, led the way.  There are plenty of wine specific examples though.  According to their website, CellarTracker was created in 2003 as a way for founder Eric LeVine (which is a great name for a wine guy) to keep track of his own wine collection.  He extended the program for a couple of friends to use and saw enough potential that he opened it up to about a hundred people to use.  By 2004 he quit his job at Microsoft and committed himself to CellarTracker full time.  They now have hundreds of thousands of registered users and many times that in people who just check out the site for reviews.  They have over 3.7 million wine reviews on the site.  Now when you are standing in the aisle at BevMo! You can use their mobile app to look up a wine or a wine region and see how it has been rated by other wine drinkers.  They still use the 100 point scale, but it has a more democratic feel to it.  Not only is it more democratic, but the numbers are also more persuasive.  An excellent research project reported in the American Association of Wine Economists journal found “empirical evidence that there is social influence on private wine evaluations that is greater than the effect of expert’s ratings and prices combined.”  Oddly enough they found that the first few reviews set the tone for the rest of the reviews.  They concluded “Our findings suggest, social influence is more important that expert’s views, and social influence is not informational but normative.”  Their study didn’t make note of the importance of a large number of reviews, but one published in the Journal of Marketing did.  They studied Amazon.com reviews and discovered that the sheer number of reviews, regardless of what they discussed or how favorable they were, had a positive impact on sales.  A Nielsen survey from2007 found that only 14% of people trust ads, but 78% trust customer recommendations.

Of course brands will still advertise.  Constellation Brands (the largest wine producer in the world) now invests 25% of its marketing budget in digital marketing with a focus on mobile platforms.  In an article on MobileMarketer.com, they discussed their plans and their successes.  They believe that sales increased by 13.5 million dollars on Arbor Mist that can be directly attributed to their Facebook page (which is hard for me to believe).  They are introducing apps by themselves and partnering with Hello Vino.  They even work with Shopkick to enable them to push notices with coupons and product information when customers are at Target stores.

Well known blogger Joe Roberts (1 Wine Dude) hates it when people say that wine is resistant to social media because it is somehow different than other products.  In various places, he has noted that there are 50 million online conversations annually about wine among over 16 million wine consumers. “To think that wine will be immune from the trends that have impacted just about everything else is total folly.”

So if social media & the wisdom of the crowds is the answer, will Robert Parker & the Wine Spectator’s influence go away completely?  I don’t believe so.  Many people, particularly Jancis Robinson have called for an end to the 100 point system.  I believe that it is too entrenched.  It was eagerly adopted for a reason and the largest wine resource in the world uses it.  That will be one ongoing influence.  More directly, I believe that Parker’s influence on the en primeur system will remain for years to come as long as he stays healthy enough to travel to France once a year.  This is simply because it is harder to crowd source.  Thousands of people will not be allowed to taste barrel samples from all of the key Bordeaux Chateaus. The en primeur system may be in trouble, but it is still important & Parker is still a huge part of it.  On Monday he said that his report this year would be 2 weeks late and it sent the internet into a flurry.

I am afraid that the stylistic influence may linger longer than Parker himself will last.  Wineries have moved to this bolder, less terroir driven system of making wine.  Although there are always outliers, this is the way that many wine makers are used to.  It is the way that they train new assistant wine makers.  It is also the way that people have been drinking wine for the last 20 years.  It will take a long time to break that cycle.  Dennis Miller used to say that the “reason Eskimos enjoy blubber; it’s the only fucking thing available at the Arctic buffet.”  Many wine drinkers prefer big Cabernets in the Parker style because that is what they have drunk for years.  I think that the sheer volume of information about lighter wines and the increasing availability of wines through the internet will eventually lead to more people trying more diverse wines.  It will take a while though.  The Millennials  seem to be more interested in exploring a wider wine world, although I had hoped to get through this article without mentioning them.  I almost made it. Foxbusiness.com quoted Rowan Gormley, CEO of Naked Wines “Millennials are storming the wine market and they want adventure and demand more transparency and authenticity from winemakers.” He estimates that one-third of his costumers are of this generation.  They may still mostly top out at $20 per bottle, but as they age, their income will grow and they will become more influential on the wine industry.

The final legacy of Robert Parker, the Wine Spectator and other dedicated wine critics over the last 20-30 years is something that will stand.  I believe that wineries as a whole will be more honest about their wines and will be more dedicated to producing quality wine than they were prior to 1978.  That is something in which those critics can take pride.

I figured this was a good opportunity to review some wines by Siduri Winery since I mentioned them earlier.  Siduri produces wine with grapes sourced from California and Oregon

Siduri-logo-color-300x199Siduri Winery is located in a nondescript office park in Santa Rosa.  I showed up on a day they were closed & I didn’t realize it.  The girl working the front office offered to pour for me since they had wines open.  I said I could come back another day, but she was very nice about it & so I tried some wines.  They had both their Siduri Wines and their Novy Family Wines.  My notes are really sparse because I felt bad about taking up their time on a day off.  I did end up buying a couple of wines.  I highly recommend stopping by Siduri Winery, but you should probably check their schedule first.

2012 Siduri Chehalem Mountains Pinot Noir $32

The stand-out flavors to me were spice and orange peel.  There is also some red fruit and an herbal note.  The wine is purple in the middle and pink on the edges.

2012 Siduri Winery Sonoma County Pinot Noir $22

I tasted sage with spice, but I primarily tasted herbal notes on this wine.  There was some red fruit as well, but I definitely came away thinking about the herbal components.

2012 Siduri Winery Sonoma Coast Pinot Noir $32

This purple to pink Pinot Noir had a strong blend of cherry and menthol.  It had soft tannins.  It looks bigger than it tastes if that makes sense.  It is so dark that you expect a bigger wine.  It was enjoyable though.

2012 Siduri Winery Russian River Valley Pinot Noir $32

This was milder than the first three.  It has herbal notes and dried cherry fruit.  I also got a little mushroom, which I tend to like in Pinot Noir.  This wine was poured at the White House Holiday Party in December of 2013.

2011 Siduri Winery Rosella’s Vineyard Pinot Noir $49

This is a nice Pinot Noir.  It is solid on the mid palate, with good spice and a long finish.  It has darker fruit flavors than the cherry that has dominated the others.  There is a little leather and some menthol as well.  Since I talked about critics earlier I should mention that this got a slew of good reviews.  It received 92 from Wine Enthusiast, 91 from The Wine Advocate, and 90 points from Wine Spectator.

2011 Siduri Winery Gary’s Vineyard Pinot Noir $54

This is another deep purple wine in the center with pink edges.  This has a very nice blend of cinnamon, cherry, and dried red fruit(mostly raspberry).  It has medium tannins. This has a really long finish.  The critics loved this one too.  It received 92 from Wine Enthusiast, 90 from The Wine Advocate, and 90 points from Wine Spectator.

2011 Siduri Winery Sierra Mar Vineyard Pinot Noir $51

This deep purple Pinot Noir has a long finish.  There is cherry and a little red liquorice.  It also has the menthol and  spice that seems to be a trademark.  It had mild tannins.  The Wine Advocate gave this 92+ points.

2012 Novy Family Wines Russian River Valley Zinfandel $22

This has dark red fruit and there is some nice cranberry here.  I got a little bit of alcohol on the nose.  The wine clocks in at 15.7% alcohol & it may be a bit over the top.

2012 Novy Family Wines Simpson Vineyard Grenache $29

This is a tannic wine with dry red raspberry fruit.  There is some red liquorice.  I think this will taste better in a year or two.

2010 Novy Family Wines Rosella’s Vineyard Syrah $29

This is an inky dark Syrah.  It has strong bacon notes and a generally meaty taste.  It has dark red fruit and some nice black pepper.  I took home a bottle.

2011 Novy Family Wines Gary’s Vineyard Syrah $32

This is full of menthol, bacon, and smoked meat.  There is also black pepper and a bit of dark chocolate.  It received 91+ from The Wine Advocate and 91 from International Wine Cellar.

2012 Novy Family Wines Sierra Mar Vineyard Syrah $29

This is a more silky wine than the other Syrahs.  It still has that dark bacon thing running through it though!  There is also some coffee and dark fruit.  You really can’t go wrong with any of the Novy Syrahs.

 

If you are a football fan & made it through all of that, I’m impressed.  Since I’m close to 4,000 words already, I’ll do something quick this time.

I want to start a new award this year.  It would be for the worst NFL predictions.  I would like to find the predictions/statements that were not just wrong, but comically wrong due to either timing or just the size of the error.  I would like to name this “The McCleon Award” after Dexter McCleon, the former defensive back for the St. Louis Rams.  He was caught on camera with 1:21 seconds left in Super XXXVI saying “Tom Brady…overrated…Tom Brady…overrated.”  Then Tom Brady completed 5 of 8 passes, with 2 of the incompletions being spikes to stop the clock, to set up the winning field goal.  If McCleon had said that earlier in the game, it wouldn’t have been as funny, but right before a classic drive to win the game, it was perfect.  So if you see or hear anything like that during the upcoming season, please let me know.

Tom Brady after Super Bowl XXXVI

Tom Brady after Super Bowl XXXVI

 

 

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