Wednesday, February 25, 2009

Wine trials: High end wineries hunker down, dig in and keep focused on making great wine

Dip in wine club

Livermore's Steven Kent Winery has seen a slight dip in its wine club. Members benefits from exclusive offers, such as buying up the 192 cases of 2006 Gielmetti Vineyard Clone 30 Cabernet Sauvignon for $300 per three-pack, the highest price for a Livermore wine. The wine is made from four different clones of Cabernet grown on two different sites for a total of less than two barrels of wine from each vineyard.

The real pinch is in the two house wines — a Chardonnay and a Cabernet Sauvignon — that owner Steven Kent Mirassou makes for 40 properties of the Ritz-Carlton Hotel chain. That has dipped nearly 20 percent. And, as 2009 moves forward, it may drop more, Mirassou says.

Still, it's not the time for Mirassou to veer from his goal: to make Cabernet from Livermore that rivals in quality Cabernet made anywhere in the world. "I would be naive to think or say that the economy isn't a challenge right now," Mirassou says. But that's not stopping him.

Staying the course

Perhaps the biggest lesson about staying the course comes from wine industry matriarch Carolyn Wente, whose family has been producing wine in the Livermore Valley for 125 years and has survived busts galore. Wente reports a 10 percent loss at the restaurant level, particularly at the end of last year. But here's her contingency plan for 2009: Hire two more regional sales managers and keep the winery's marketing strategy exactly where it is.

Why? She cites a Nielsen statistic about the recession of the 1980s. Companies that maintained aggressive sales and marketing efforts enjoyed more growth after the recession — some 275 percent in the five years after the recession — compared with the 19 percent growth among companies that cut or reduced those budgets.

Read the entire article here.

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