While doing research for a blog post on taste, I came across something curious. A study was released on wine color and perception that tricked a group of wine tasting professionals. The study author, Frederic Brochet, was quite critical of the tasting notes, effectively saying in the discussion portion of the study that all wine tasting notes were based predominantly on visual cues, calling into question the validity of tasting notes everywhere. This kind of person struck me as rather opposed to the 'snobbery' of the wine industry and its associated inaccessibility.
Until I found this website...apparently none other than Frederic Brochet himself has gone on to found a winery! As Taylor noted in his (excellent) blog post on dentists and wine, it appears this industry has a certain allure that attracts even the relative nonbelievers among us.
Friday, March 15, 2019
Case response : Take the $!
The clear answer here is that Eberhart should take the deal to sell the company. His goals are to spend more time in Palo Alto and to leave the winery in good hands. Taking the deal achieves both. The Current CEO Koo is supportive of the deal which will ensure the latter. Selling the company will also ensure the former. Furthermore, if he doesn't sell he will either have to invest in the business or raise more money. These are not consistent with his stated goals. Take the money and run!
Taste, taste, do you love the taste?
What exactly is taste, anyway?
Is it actually smell? The vast majority (think 80%+) of what
we call ‘taste’ in everyday conversation is actually smell driven. While this may
sound ridiculous, consider how well you were able to ‘taste’ the last time you
had a cold – despite your tongue being in peak condition, you likely found
everything quite bland. This is why our wine tasting extraordinaire Alder
Yarrow employs a technique called orthonasal olfaction; he breathes air in
through the mouth (ortho) and forces it out of the nose (nasal), thereby carrying scent
molecules directly to the comparatively sensitive odor receptors.
Is it genetic? George HW Bush famously said “I’m the
president of the United States, and I’m not going to eat any more broccoli”. But
is this him being picky, or is it in his genes? He may very well have a variant
of TAS2R38, making him very sensitive to the bitterness of broccoli. This same
gene (and its kin) explain why some folks find IPAs incredibly bitter and deep
reds unpalatable no matter how much protein/fat they’re paired with. These
genetic differences mean it’s very possible you find a wine deeply tannic,
while the person holding the glass across from you just finds it astringent,
and you’re both right. Source
Is it in our head? We have weird associations in our head
that come together with the signals from our nose and our tongue to form a full
picture we call “taste”. This is why oysters taste better when you’re by the
ocean; the sight, sound, and touch of food play a role in your perception due to
your brain’s ability to make associations. This was incredibly useful back when
we had to remember what plants not to eat when foraging, however it’s more of a
hindrance when wine tasting. Example 1: wine tastes better when you think it’s
expensive, not only because you feel social pressure, but also because your brain actually
convinces you it’s so. Example 2: a panel of wine tasting professionals
drank Sauvignon and Sémillon colored red, and came up with almost exclusively
red wine tasting notes in their descriptions – researchers propose these pros had
been primed for tasting notes by the color, again demonstrating why our
intuitions can deceive us.
If it’s actually smell, genetically variable, and highly
subjective based on past experience, again I ask: taste, taste, do you love the taste?
Where are the Women Sommeliers?
Women are objectively better wine tasters than men.
A study published in scientific food journal "Food Quality" found that women are scientifically better than men at tasting wine. They are more perceptive to picking on on subtleties in taste and smell. Women also showed a superior ability to differentiate between wines and were less susceptible to emotions when objectively evaluating wine.
That women are superior to men when it comes to tasting wine is of no surprise; women are better than men at many (most?) things in my opinion.
What IS surprising is that of the 229 Master Sommeliers in the world, only 15% are women! I suppose this shouldn't be surprising given the prevalence of underrepresented across many industries, but 15% was astonishing.
Any of my classmates have hypotheses as to why more women are not becoming sommeliers? Would love to hear in the comments!
A study published in scientific food journal "Food Quality" found that women are scientifically better than men at tasting wine. They are more perceptive to picking on on subtleties in taste and smell. Women also showed a superior ability to differentiate between wines and were less susceptible to emotions when objectively evaluating wine.
That women are superior to men when it comes to tasting wine is of no surprise; women are better than men at many (most?) things in my opinion.
What IS surprising is that of the 229 Master Sommeliers in the world, only 15% are women! I suppose this shouldn't be surprising given the prevalence of underrepresented across many industries, but 15% was astonishing.
Any of my classmates have hypotheses as to why more women are not becoming sommeliers? Would love to hear in the comments!
Most expensive wine ever?
Although we millennial consumers do not like to pay up for luxury goods, we still understand that fine wines can be expensive. So, what is the most expensive bottle of wine ever? Before I researched this, I assumed the price would be around a million dollars and would be a very old french Bordeaux
So, I was surprised to learn that the most expensive bottle ever sold was a 1992 vintage Screaming Eagle Cabernet Sauvignon made in Oakville California. Sold in 1995 at a Napa Valley auction, the winning bid was $500,000 for the 6-liter bottle.
Assuming 5 ounces in a standard glass of wine, a glass of this '92 cab would be worth $12,500!
So, I was surprised to learn that the most expensive bottle ever sold was a 1992 vintage Screaming Eagle Cabernet Sauvignon made in Oakville California. Sold in 1995 at a Napa Valley auction, the winning bid was $500,000 for the 6-liter bottle.
Assuming 5 ounces in a standard glass of wine, a glass of this '92 cab would be worth $12,500!
Love Wine? There's an app for that
Mobile applications have pervaded modern life in every imaginable way. So, of course, there are many apps available for wine lovers to get their fix even when they don't have a glass in hand. Let's look at some of the top wine apps available today.
Vivino: Scan labels, learn about the wine, read reviews, and find out where to buy.
Know Your Wine: This app developed by Decanter Magazine helps educate users about all things wine. It calls itself a wine "microeducation" platform. Work through its content and be well on your way to becoming a wine expert!
Cellar Tracker: Similar functionality to Vivino
Vinocell: Manage and track your own wine inventory- this one is for serious wine enthusiasts. It costs $8.99 in the app store. I think I'll stick with a spreadsheet...
Pocket Wine Pairing: Straightforward app that helps users decide which wine to pair with which food.
Vivino: Scan labels, learn about the wine, read reviews, and find out where to buy.
Know Your Wine: This app developed by Decanter Magazine helps educate users about all things wine. It calls itself a wine "microeducation" platform. Work through its content and be well on your way to becoming a wine expert!
Cellar Tracker: Similar functionality to Vivino
Vinocell: Manage and track your own wine inventory- this one is for serious wine enthusiasts. It costs $8.99 in the app store. I think I'll stick with a spreadsheet...
Pocket Wine Pairing: Straightforward app that helps users decide which wine to pair with which food.
world-class wine 30 in from campus?
Many of us students assume that in order to visit a world class winery we have to drive 2+ hours to Napa or Sonoma. However, it turns out that we have a critically-acclaimed winery right here in our backyard in cupertino: Ridge Vineyards.
Established in 1962, Ridge has been making wine in the Santa Cruz mountains that has more than held its ow on the international stage.
Ridge's Cabernet Sauvignon took 5th place at the famous 1976 Judgement of Paris competition.
Established in 1962, Ridge has been making wine in the Santa Cruz mountains that has more than held its ow on the international stage.
Ridge's Cabernet Sauvignon took 5th place at the famous 1976 Judgement of Paris competition.
Scribe: A case study for legacy wineries
Everyone in the wine industry in terrified by millennial wine consumption trends. However, I think that the legacy players are focusing on the wrong strategies to win over the younger consumers. Visitors to class this quarter talked a lot about things like adding wifi to tasting rooms, optimizing social media presence, and investing in digital marketing channels. I think these are misguided.
Scribe winery is a perfect case study of what the incumbents should do to attract millennials. The short answer is: don't try so hard.
Scribe has a beautiful, but relatively austere physical presence. There are no dark and wooded tasting rooms, no palatial edifices, no fountains, etc. It is merely a small house perched on a grassy bluff overlooking its beautiful vine-covered land. Members (yes, you have to be a member or guest of a member to visit- a cool feature in and of itself) sit on the grass, drink wine on multi-colored mexican-style blankets, and enjoy beautiful picnic baskets purchased on site.
The key here is:
- Focus on exclusivity
- experience and aesthetic wins the day
Scribe winery is a perfect case study of what the incumbents should do to attract millennials. The short answer is: don't try so hard.
Scribe has a beautiful, but relatively austere physical presence. There are no dark and wooded tasting rooms, no palatial edifices, no fountains, etc. It is merely a small house perched on a grassy bluff overlooking its beautiful vine-covered land. Members (yes, you have to be a member or guest of a member to visit- a cool feature in and of itself) sit on the grass, drink wine on multi-colored mexican-style blankets, and enjoy beautiful picnic baskets purchased on site.
The key here is:
- Focus on exclusivity
- experience and aesthetic wins the day
Blue Wine?!
What are Blue wines all about? Are they made from blueberries? What do they taste like?
It turns out blue wines are made from a combination of red and white grapes, natural pigments, and a natural sweetener.
Blue wines are a recent phenomenon, having been introduced to the market in 2016 by a brand called Gik. The European union, worried about the impact Gik's blue wine may have on wine culture and reputation, mandated that Gik call itself "blue beverage" instead of "blue wine."
So... I guess blue wine isn't really "wine" after all! Who knew!
It turns out blue wines are made from a combination of red and white grapes, natural pigments, and a natural sweetener.
Blue wines are a recent phenomenon, having been introduced to the market in 2016 by a brand called Gik. The European union, worried about the impact Gik's blue wine may have on wine culture and reputation, mandated that Gik call itself "blue beverage" instead of "blue wine."
So... I guess blue wine isn't really "wine" after all! Who knew!
Orange Wine?!
I keep hearing about orange wine... what is it all about? is it a new varietal? Is it made from oranges? Why am I just now hearing so much about it? Lets find out!
It turns out orange wine is not a new varietal. It is merely a wine that has an orange hue due as a result of its unique fermenting process. Orange wines are made with white wine grapes and fermented with the skin still on the grapes, a process known as "skin-contact" fermenting. This is typically done with traditional red wines, but the skin is generally removed when making white wines.
The resulting taste is different than traditional white wine. It has been described as sour, nutty, and tropical. It also has a tannin presence which is atypical in white wines.
Orange wines, although very hot with the kids these days, are not a recent invention. They date back over 6,000 years. So... why are they so popular suddenly? My guess: instagram
Orange wines are beautiful in photographs and their unique aesthetic have helped contribute to their pop culture rise.
Cheers to some orange wine!
It turns out orange wine is not a new varietal. It is merely a wine that has an orange hue due as a result of its unique fermenting process. Orange wines are made with white wine grapes and fermented with the skin still on the grapes, a process known as "skin-contact" fermenting. This is typically done with traditional red wines, but the skin is generally removed when making white wines.
The resulting taste is different than traditional white wine. It has been described as sour, nutty, and tropical. It also has a tannin presence which is atypical in white wines.
Orange wines, although very hot with the kids these days, are not a recent invention. They date back over 6,000 years. So... why are they so popular suddenly? My guess: instagram
Orange wines are beautiful in photographs and their unique aesthetic have helped contribute to their pop culture rise.
Cheers to some orange wine!
Wine In Style
If I were in this position, I would sell the company. It’s clear
that the company needs cash, and that the focus of Eberhart has shifted since
launching years ago. If my child ever left me out of a family photo, I too
would be spending more time at home, and would probably look to permanently
shift my career to something in the same time zone (or at least the same
continent). As we discussed in class, there is a human element to all of this,
and I think it’s important to consider that in a business decision such as
this.
However, I would like
to research the proposed investors more than some board members might like to. It
is off-putting that they are unknown. My first instinct / worry is that these
are competitors looking to take advantage of a moment of weakness. I think due
diligence is key before agreeing!
Paso Robles Wine
This weekend I'm visiting Paso Robles wine region located 3 hours south of Palo Alto. I write this to make classmates aware of the variety of wine regions that can be visited on weekends outside of the famous ones. Paso Robles focuses on Rhone varietals. Its first vineyards opened in the 1790s and the region now has over 200 wineries spread over 13,000 hectares. More than 80% of production are reds including Cabernet Sauvignon, Merlot, Syrah and Zinfandel.
It hosts the annual Hospice du Rhone, which is unfortunately in late April. Fortunately, this weekend is Zinfandel weekend. Zinfandel from the region is typically full bodied and fruity with aromas of berries and black cherries.
Paso Robles can be combined with a weekend trip to Monterey, Carmel, Morro Bay and Big Sur. I recommend a trip down during your time at the GSB. Let me know if you want to know about the Zinfandel.
It hosts the annual Hospice du Rhone, which is unfortunately in late April. Fortunately, this weekend is Zinfandel weekend. Zinfandel from the region is typically full bodied and fruity with aromas of berries and black cherries.
Paso Robles can be combined with a weekend trip to Monterey, Carmel, Morro Bay and Big Sur. I recommend a trip down during your time at the GSB. Let me know if you want to know about the Zinfandel.
Australian wine perception in the USA vs China
More people drink Australian wine in the USA than in Australia. About 18 million Americans were estimated to drink Australian wine in 2017/18, which represents 19 percent of regular imported wine consumers. About 8.7 million Australians do. Some of this is largely due to population (Australia's is 25 million, the USA is 326 million). The next largest drinker of Australian wines is China with 15.5 million estimated in 2017/18, or 30 per cent of imported wine drinkers.
Wine Australia surveys markets in which Australian wine is consumed on quality perception. In 2018, Chinese wine drinkers rated it 8.32/10. US consumers rated it 8.14. US consumers perceive Australian wine as being great value for money for a given quality. However, US consumers above the $20 per bottle category has low quality perceptions of Australian wine. As consumers have entered higher price points, growth in US wine exports from Australia fell 7 percent in value in twelve months to March 2018. In contrast China imports of Australian wines grew at 25% in 2018. A large driver of this is reducing tariffs on Australian wines in China.
In a survey asking how proud consumers are of serving Australian wine, 75% of Americans agreed or strongly agreed compared to 88% in China. This is largely a function of the success of Yellow Tail entering the USA with mass produced but good value for money wine which took off. However,
Australia has a number of fine, premium wines. The most famous are full bodied Shiraz and red blends such as Penfold's Grange and Henschke's Hill of Grace. These wines are highly sought after by Chinese business people. The auspicious preference for the deep red colour of these wines is a testament to the power of consumer preferences. But more importantly, the original positioning of a wine region and brand in a market is clearly crucial to the long term demand for their products. I reflect on Bordeaux' 5 tier classification system which has persisted for 160 years.
Wine Australia surveys markets in which Australian wine is consumed on quality perception. In 2018, Chinese wine drinkers rated it 8.32/10. US consumers rated it 8.14. US consumers perceive Australian wine as being great value for money for a given quality. However, US consumers above the $20 per bottle category has low quality perceptions of Australian wine. As consumers have entered higher price points, growth in US wine exports from Australia fell 7 percent in value in twelve months to March 2018. In contrast China imports of Australian wines grew at 25% in 2018. A large driver of this is reducing tariffs on Australian wines in China.
In a survey asking how proud consumers are of serving Australian wine, 75% of Americans agreed or strongly agreed compared to 88% in China. This is largely a function of the success of Yellow Tail entering the USA with mass produced but good value for money wine which took off. However,
Australia has a number of fine, premium wines. The most famous are full bodied Shiraz and red blends such as Penfold's Grange and Henschke's Hill of Grace. These wines are highly sought after by Chinese business people. The auspicious preference for the deep red colour of these wines is a testament to the power of consumer preferences. But more importantly, the original positioning of a wine region and brand in a market is clearly crucial to the long term demand for their products. I reflect on Bordeaux' 5 tier classification system which has persisted for 160 years.
Gabriel Glas wins out!
In the interest of finding alternative ways to continue my wine education, I've been perusing Wine Folly's wine blog and education resources, and came across this video of Wine Folly's red wine glass showdown. Spoiler Alert, our friend Gabriel Glas won out!
Red Wine Glass Showdown
Some other resources I've enjoyed:
Her rant on the 3 tier system and why it ruins everything
Pretty extensive varietal resources, including taste profile and handling notes such as decanting time and ageability
Red Wine Glass Showdown
Some other resources I've enjoyed:
Her rant on the 3 tier system and why it ruins everything
Pretty extensive varietal resources, including taste profile and handling notes such as decanting time and ageability
Millennials!
It seems to come up every class, this infamous generation. We mentioned it briefly in our presentation, but it does seem quite unfair - and lazy - to call an entire generation of 80 million people by one name and to assume their wine consumption and buying preferences are the same.
So, I dived a bit deeper.
At first, I was disappointed to find analyses that basically lopped the generation in half, as if that were helpful. Early Millennials vs. Recessionists like here. Evidently these groups have very difference experiences with technology, violence, and participation trophies. Seems reasonable, and I believe it, but it doesn't really help me sell them wine differently.
Fortunately, AdWeek had a slightly more in depth segmentation. The names are a bit ridiculous but they include:
So, I dived a bit deeper.
At first, I was disappointed to find analyses that basically lopped the generation in half, as if that were helpful. Early Millennials vs. Recessionists like here. Evidently these groups have very difference experiences with technology, violence, and participation trophies. Seems reasonable, and I believe it, but it doesn't really help me sell them wine differently.
Fortunately, AdWeek had a slightly more in depth segmentation. The names are a bit ridiculous but they include:
- Boss Babes
- Brogrammers
- The Underemployed
- Shut Out
- Nostalgics
- Travel Enthusiasts
- Culinary Explorers
- The Exuberants
- The Collectors
- The Quarter-Life Crisis Millennials (severe student loan debt!)
- Millennial Marthas
- Millennial Moms
If you're curious, you can read more here. I've bolded those who, at a glance, may align with Birdhorse's message and value proposition. However, I'm not sure I believe the groupings and I would love to know the relative sizing. In any case, I think this is a good start of a more granular, targeted conversation about Millennials. We deserve it!
Bottle Shock
Bottle Shock - besides being a pretty terrible drama/comedy - is the condition where flavors are muted or otherwise screwed up in a bottle of wine immediately after bottling. This is why we served Birdhorse out of shiners pulled off a couple of weeks ago and not sent through the bottling truck. The shock can occur for older wines, too, when they are perturbed in travel or otherwise handled roughly. Why? The disturbances from shifting the old wines or shooting the wine in a pressurized fashion into an air-filled bottle end up super saturing it with oxygen. The oxygen needs to dissipate. Normally this occurs over time when the gases leach through the cork. What about screw tops, you ask? Well, cheaper ones ignore this problem; however, there are newer screw tops that have a pad of silicon embedded which help with the O2 transmission out of the bottle.
In any case, the important thing is what to do. First solution is to wait. Give it a few weeks to a month after bottling before sale and consumption. This doesn't work with very aged wines, of course. For those, you should use the sediment as a guideline. Stand it upright for a few days (best at a slight angle if you can) and wait for the sediment to fully settle.
More here: https://www.winespectator.com/drvinny/show/id/44883
https://blog.eckraus.com/what-is-bottle-shock
https://blog.eckraus.com/what-is-bottle-shock
When our other investment ideas take off... buy a vineyard?
The good news: there's still a lot of diversity in the land pricing within California. While we may never be able to get an acre in Napa, Central and San Joaquin valley still look affordable.
The best news: wine-producing land is even cheaper in some beautiful places like France and Oregon
Some other things to keep in mind:
- It takes ~5 years to convert unharvested land to productive vineyard
- Average returns on the sale of grapes alone is 4-5%
- "Most of the time investing in other alternatives is going to reap longer term returns that are higher," Kristein Nelson, head of Wealth Management at Bank of the West
Sources:
- La Safer (cited in Forbes, French agricultural organization that tracks vineyard transactions)
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