Saturday, March 18, 2006

French Lesson

An unpalatable prescription for the French wine industry

The following article appeared in the April 2006 edition of Wine & Spirit magazine

This is, to put it mildly, not a great time to be a French winemaker. Various speakers at the annual Wine Evolution conference in Paris in January revealed how French wine was being hammered into the ground across the globe by Australia and New Zealand. But the low point in the sad litany of statistics came when the figures for Canada appeared on the screen. Shipments to Quebec, traditionally one of the most pro-Gallic areas of the world, fell by over 35% last year. It was as though some of George W Bush’s supporters had begun to wonder whether there was something to be said for the Taliban after all.

Falling sales overseas and at home have finally forced France’s winemakers to wake up to smell the coffee – only to discover that the bitter black aroma they understand has been supplanted by something a lot more like a Starbucks skinny latte. And the experience has created widespread confusion and despair. In Burgundy a grower with vines in the Cote d’Or – and a cellarful of stock – asked a British visitor in bewilderment, “what are we to do…? It’s not as if we’re railway workers who can go on strike to get what they want”.

Within France, supposedly serious proposals include a suggestion that the government to take responsibility for wine sales and marketing. More usefully, there is a serious acknowledgment of the need to cut production – by uprooting vines and limiting yields – and to improve quality – by imposing appellation controlee rules more rigorously. In Languedoc 12,500ha, of vines have already been torn up, while the figure – so far – for Bordeaux is 1,800ha. But simply focusing on quantity and quality is rather like approaching a cancer patient with a sharp knife and a packet of sticking plasters.

Vine-pull schemes, like factory closures and forced redundancies, certainly help to cut excess production, but they don’t solve thornier problems such as why decent, inexpensive Sauvignon Blanc from Bordeaux is a drag on the market while sales of pricy New Zealand Sauvignon are flying into the stratosphere. Which brings us to the question of quality. How is anyone to define what is and isn’t a “good” wine? Ask most French – and many British - critics to judge between a typical, noticeably tannic, gently acidic claret and a soft, slightly (or more than slightly) sweet, branded Aussie Cabernet and they’ll go for the Old World wine. Then offer both bottles to a consumer almost anywhere and you’ll get a very different response. Ask most Frenchmen why their country is currently one of the most profitable in the world for McDonalds – and why you can’t drive through the city of Bordeaux without passing at least three sets of golden arches.

Simply making less of the same wines better will not solve France’s problems. Some French wines – from Muscadet to basic red Bordeaux - just don’t suit current tastes. Kodak could have gone on improving its black-and-white film, but that wouldn’t have helped much in a world that has switched to digital colour. Black-and-white film no longer features on its Kodak’s menu, but it will happily sell you a digital camera or paper on which to print out your pictures.

That kind of pragmatism is not available to France’s wine industry. A winegrower in an appellation region like Bordeaux or Burgundy can’t significantly change the style of his wine – or launch a new one – as legally he might in Italy. And even if he were to persuade his neighbours that the appellation rules should be amended, nothing can happen until an official in Paris has applied his rubber stamp. And, that can be stopped by lobbyists from other parts of the country. So, when Jean Thevenin wanted to produce a sweet wine in Macon Clesse, his efforts were blocked by producers in Sauternes and the Loire. And when Bordeaux tried to create a Vin de Pays for itself, the plan was sabotaged by the Languedociens, who feared moustache-twirling competition for their Vins de Pays d’Oc.

We live, whether we like it or not, in an age where the brand is king. According to a recent Dutch study of 200 children reported in the Journal of Applied Developmental Psychology, most two-to-three year-olds recognized eight out of the 12 logos they were shown. While France’s winemakers have busied themselves creating ever more obscure appellations and rules, the New World has been building brands. While the Gallic philosophy has been that it is up to the client to learn to understand its labels and appreciate its styles, Antipodeans and North and South Americans and even some other Europeans have been simplifying their packaging and flavours. It is no accident that Yellow Tail (120,000,000 bottles sold globally last year) has a striking label with colour-coded capsules for the different grape varieties – and 10 grams of sugar per litre in the reds (compared to the paltry one or two grams that are commonly found in basic Bordeaux). Of course, French producers can quite reasonably say that they don’t want to compete with wines like Yellow Tail. The only problem is that, across the world, these and other branded New World wines are the ones whose sales are growing fastest. In Britain, the top four best selling brands are seeing growth of 48%, while unbranded wines are standing still or sliding backwards.

But surely, the French would argue, our appellations are our brands. The notion of the appellation-as-brand has four drawbacks. There is the obvious risk that in any region, the lowest common denominator will potentially spoil the game for the higher quality players. In France, Jean-Marie Chadronnier of Dourthe freely admits that selling his Dourthe No 1 Bordeaux Blanc is made more difficult by the generally poor reputation of white Bordeaux.

Even if the quality issue were resolved at a stroke, there would be the small matter of stylistic consistency. Penfolds fans know what to expect from wines bearing the Penfolds label; In France it is impossible to know whether a Vouvray or Alsace Gewurztraminer will be sweet or dry.

Brands need skilled management and marketing – and often quite substantial budgets - if they are to survive. And there is a limit to the number of brands a market can sustain. If, as has been predicted, General Motors goes bankrupt this year, the finger of blame has already been pointed at its plethora of ill-focused brands.

One of the reasons most supporters of the French appellation system give for its maintenance, is that other countries are busily setting up similar designations of their own. They are missing the point. In the New World, appellations are optional - garments to be worn or discarded at will, rather than the straitjackets favoured in France. But far more crucially, many of the newest appellation areas are facing the same problems as their counterparts in France. British supermarket shoppers are no more aware of Mudgee or Mount Benson than they are of Madiran and Montravel.

The situation of French wine today is horribly reminiscent of the British motor industry of the 1970s and 1980s. Despite an illustrious history and the global prestige of names like Rolls Royce, Bentley and Jaguar, a badly run industry, riven with disputes and featherbedded by the taxpayer was making a confusing array of cars too few people wanted to buy or drive. Rescue of a kind, came in the form of investment by Japanese manufacturers who listened to their customers. Today, Britain has become very good at making Japanese cars. What if a similar fate awaited France?
Today, the fastest selling French wine in the US, with sales of over 250,000 cases, is a Vin de Pays d’Oc called Red Bicyclette. It was produced and launched in 2004 – after extensive consumer research – by E&J Gallo.

So what is France to do?

The recipe in 12 parts

1) Teach France’s wine producers to listen to their customers.
Establish an annual bursary to send 2,000 young French men and women to work for 6 months in wine retailers and (non French) restaurants throughout the world. Learn from the successes foreigners have had with French brands like Fat Bastard and Red Bicyclette.
2) Introduce a national vine-pull scheme.And link it to a staged removal of state subsidies (see below). In other words, people who refuse to take advantage of a payment today know that they will have to fend for themselves in the foreseeable future.
3) Allow multi-regional blends that are subject to the same restrictions as in the New World.
In other words, if Pernod Ricard want to make a French version of their Jacobs Creek by blending grapes from the Loire, Bordeaux, the Rhone and Languedoc Roussillon, give them the total freedom to do so. And if the customers for those wines want them to be sweeter than is traditional in France, don’t stop them from applying the Australian technique of adding a little concentrated grape juice.
4) Make appellations optional
Where producers choose to sell their wines under local or regional appellations let them do so, but if they prefer to offer wines under a broader designation – as is now common in Italy - don’t stand in their way. And stop allowing growers in one region from preventing their counterparts elsewhere from defining their own styles.
5) Remove all restrictions on varietal labeling
Stop the ludicrous inequalities that allow Bordeaux producers to print Sauvignon on their whites while preventing Minervois from printing Syrah on its reds.
6) Remove all rules on yields and irrigation
Water is a valuable resource. Meter it and charge winemakers if they want to irrigate their vines. But don’t ban the practice. Allow the market to decided what is and isn’t overcropped and/or over-irrigated
7) Remove the distillation regime
Take away the safety nets that allow producers to receive government money for excess wine. Unsold wine should be treated in the same way as unsold bread and cakes.
8) Remove Paris from the equation
Allow producers and regions to run their own affair. Study the Australian model and remove all unnecessary red tape.
9) Provide loans to cooperatives to encourage them to develop and merge.
France’s cooperatives are the biggest hope for its wine industry. Today some 870 of them produce just over half of the country’s annual harvest. Most of it is poor to average and little of it is branded, but a exceptions to the rule like Nicolas Feuillatte and Jacquart in Champagne, La Chablisienne in Burgundy, Wolfberger in Alsace, Plaimont in the South West and Val d’Orbieu in Languedoc all show what could be achieved if these businesses were properly run. The recently-launched Blason de Bourgogne, a brand jointly shared by four cooperatives, also demonstrates how old regions can play the same games as the New World.
10) Remove the focus on vintages for more basic wines
Modern consumers want consistency. Encourage the kind of inter-vintage blending (up to 15%) that is done in other countries to produce attractive commercial wines
11) Subsidize wine tourism.
Compare the Hunter or Napa Valley with the Medoc and Cote d’Or and it is clear that very few lessons have been learned from the New World. How many wineries have restaurants or cafes? How many have shops? How many offer safe playgrounds or picnic areas? In a world where retailer’s shelves are shrinking wine tourism may be the only hope for small producers. The Champenois, Duboeuf with its visitor centre in Romaneche-Thorins, Olivier Leflaive with its restaurant and Mouton Rothschild with its museum all show the way, but these are exceptions to the rule…
12) Create a national research centre and improve education
Plenty of claims are made for the quality of research in France, but there is little evidence for it taking place on a national or regional basis Where are the studies on different kinds of closure? Of irrigated versus non-irrigated vineyards? Of different clones of grapes like the Petit Verdot? Copy the Australian model of the Wine Research Institute, and levy money from producers to fund it properly. Teach wine business. Teach winemakers how and why to build up mailing lists and how to increase their direct sales. Launch courses covering packaging and marketing, including lessons on what works best in specific markets.

And if all of this seems too tough, I have a radical alternative that President Sarkozy might care to consider: threaten Lous-Vuitton-Moet-Hennessy with nationalisation unless it takes over the entire industry, possibly in conjunction with Pernod Ricard and Castel. The firms that manage brands ranging from Cloudy Bay and Jacobs Creek to Moet & Chandon and Krug couldn’t do a worse job than is being done today.


A teenage girl watched her mother cutting up a ham before putting in the oven. Why, she asked, was the meat always cooked in two pieces. Her mother replied that everything she did in her kitchen had been passed down from her own mother who had routinely cut the ham in half. Still curious, the girl raised the question with her grandmother – who said that she too had simply followed the family tradition. Fortunately, the great-grandmother, a sprightly woman in her early nineties, was still around to provide the explanation. “Oh, there’s no mystery” she said. “We never had a dish big enough to accommodate the whole ham”.

Wednesday, March 08, 2006

Wine International is Dead

The following article appeared in Update, the newsletter of the UK Circle of Wine Writers, in early 2006

Wine International breathed its last on December 10th with the publication of the magazine’s 262nd monthly issue, though Buddhists – no pun intended – may take some comfort from its semi-reincarnation as Wine & Spirit. As one of the magazine’s progenitors and sometime guardian, I’m not going to offer a belated eulogy over the corpse, but I thought a discursive obituary might be in order – if only to enlighten a wider audience about how wine magazine publishing actually works.

First things first. To set the record straight, the only crime William Reed, the new owners of Wine Intl could fairly be accused of with regard to Wine Intl is euthanasia. The magazine was losing money and had been doing so for much of its existence. Without the rather considerable amounts of cash that its child, the International Wine Challenge, brought home every year, the end would have come long ago. Perhaps if the ailing publication had changed its lifestyle or moved home at some earlier stage, it might have survived and even thrived, but that kind of conjecture is hardly fruitful at this stage. (And it is perhaps relevant that no major consumer publisher has ever attempted to buy the magazine or launch a rival).

I’m not ideally suited to judge whether Wine Intl was, or was not, a very good publication. I would claim, however, that it broke new ground when it first appeared and, over the two decades of its existence played a significant part in the consumer wine revolution we are still living through. It seems strange to think that when Charles Metcalfe and I produced the earliest issues, Australia was still exotic, and supermarkets were still struggling to convince people that they genuinely competed with “specialists” like Peter Dominic and Augustus Barnett. Under a series of editors – myself, Joanna Simon, Margaret Rand, Ruth Cobb, Susan Lowe, Chris Orr, Chris Losh and Catharine Lowe – it tried on a number of different sets of clothes. Every now and then, it flirted with becoming more populist (aka dumbing down) in the hopes of selling more copies in supermarkets. At other times – particularly more recently - it ascended to the higher ground of en primeur and tastings of Champagnes from different villages.
However, while it was clear that populism reduced popularity, when we counted the number of copies we sold every month, there was depressingly little correlation between what we thought of as good and less good issues. Imagine a Bordeaux chateau that sells roughly the same number of bottles of its 1997 and 2002 as of its 2000 and 2003, and at a similar speed and price, and you will get the picture. Covers influenced circulation somewhat, but since a substantial proportion of the readers were subscribers (as is the case for Decanter), and the total number of copies on news stands was relatively small, (as is the case for Decanter), the overall impact was far less significant than one might suppose. In branches of Oddbins and Majestic, the pattern was clear: five or six magazines would be bought every month by the same five or six people. All of which, of course, begs the question of how many copies we actually sold.

If you had asked the publishers of Wine Intl for this information, the official answer was that we printed 30-35,000 copies. Which is rather like the producer of a play telling you how many seats there are in the theatre, rather than the number of tickets that have been purchased at the box office. The magazine publishing world offers a perfectly good means of avoiding this kind of fudge. Any publisher who wants to can jump through a few hoops to get an ABC – neatly named after the Audited Bureau of Circulation – figure for the number of copies sold, or distributed in other ways. Country Walking, for example, supports its claim to be “Britain’s best-selling walking magazine” by proclaiming an audited average monthly sale in 2004 of 47,274 copies. Well over twice or possibly thrice as one might reasonably believe Wine Intl or Decanter genuinely to have sold in the UK.

Wine International never had an ABC, though surprisingly few of the advertisers, for whom such details ought to matter, ever requested one. But then, presumably the same could be said for the people who placed ads in Decanter which does not choose to offer an audited circulation figure either.

What Decanter can convincingly say is that it has a significant – over 40% - readership outside the UK, and this is crucial, because getting people occasionally to buy, let alone subscribe to, a wine magazine in this country is far, far tougher than most wine writers might imagine. (When Wine Magazine became Wine International, sadly the addition of the adjective represented the major part of the effort to expand its number of overseas readers). In Britain, over the years, a succession of circulation managers tried all kinds of wheezes. We piled up copies in WH Smiths, in Waitrose and in Oddbins, and we offered subscriptions at knock-down rates to Barclaycard customers, to doctors and lawyers and to members of the Sunday Times Wine Club. Copies were distributed on Eurostar trains and generous discounts were offered to wine clubs. None of this was easy or very fruitful. The WH Smiths of this world see special-interest magazines like Wine Intl and Decanter in much the same way that Tesco view an £8 Pecharmant. Wine Intl took up the same amount of shelf space as Penthouse or Country Living, but sold infinitely more slowly. So, the chances are that a wine magazine will either be tucked away behind faster-moving fare – or that it won’t be stocked at all. And of course, the less visible you are, the lower the sales, and the greater the reason for refusing to give you space in the first place. The only hope of breaking this pattern is to secure a slot next to the till – the news trade’s answer to the gondola end in a supermarket wine department. And here too, the same retail rules apply. Simply getting onto the shelves of a big newsagent chain costs money nowadays and premium positions like these come at a painfully high price. A single month of this kind of prime exposure in a specific set of WH Smiths stores could easily set you back £20-30,000 – hardly the kind of money you’d rush to spend without feeling pretty confident of a big uptake in sales. We took this route sometimes for our most boring issues of the year – the ones packed with IWC winners – and did indeed sell more copies, but never saw the increase carry over to the following months’ issues that were full of beautifully written articles.

In simple terms, there is no current evidence that the UK can single-handedly sustain a consumer wine magazine. With the demise of Wine Intl, we are left with Decanter (heavily sold overseas), World of Fine Wine (tiny and even more reliant on sales to other countries) and Fine Expressions (new and far too focused on whisky to qualify as a wine magazine). This is really quite curious, when you consider that countries like Latvia, Eire, Korea, Georgia, India and Thailand all have glossy wine magazines and that Russia and Japan can each field several. So why not Britain? The answer that used to be given was that consumers got as much wine writing as they needed from newspapers, but with the shrinkage of coverage in papers like the Sunday Telegraph, Sunday Times and Evening Standard, that’s highly debatable.
My own view, for what it’s worth is that the explanation is glaringly simple. Why would a country, most of whose wine drinkers resent paying more than a fiver for a bottle of wine (only 12% of wine is sold at above this figure) want to splash out £4 on a magazine. Of course there is a fine wine market – all those people who flock to taste Burgundy en primeur every January for example - but I suspect that a large proportion of them either rely on the advice of their merchants or place their trust in industry-standard ratings from Parker and the Wine Spectator. Or both (as in the Farr Vintners Bordeaux en primeur listings).

It is revealing that our inability to sustain consumer wine magazines is echoed in the field of food publishing. BBC Good Food may still flourish – thanks largely to the presence of tele-chefs, but more up-market offerings like BBC Gourmet Good Food, Taste and A la Carte have all foundered and the word on the street is that neither Delicious nor Olive are, as it were, bringing home as much bacon as their publishers might have hoped.

It is instructive to compare the UK and US wine markets. On the other side of the water the greatest growth is at the higher end of the price scale. (In Britain we talk up the rise in sales of over-£5 wine, but an average retail price per bottle that remains pegged at £3.84 reveals some pretty vigorous activity in the bargain basement.) Of course we sophisticated Brits mock the credulous Yanks who splash out what we think of as silly money on wines with Parker or Spectator points. But our right to a superior stance is undermined by the fact that few of us have ever tasted many of those wines – for the simple reason that they don’t hit these shores. Or do so in such tiny quantities that they by-pass the press completely. London does not have a dedicated wine shop that is as good as several in New York, and the owner of the brilliant Lavinia stores in Paris, Barcelona and Madrid is planning to move into Moscow and Shanghai but sees no appeal in trying to retail wine in the British capital.

The usual target of blame for the state of the UK wine trade is the supermarkets who are pictured as being somehow morally deficient in the way they handle wine. Wine writers and merchants are as free with their opinions of what the supermarkets ought to do about wine as London cabbies are with their views about Ken Livingstone and immigrants. Unfortunately all these criticisms miss the point. Supermarkets are no more “in the wine business” than they are seriously in the business of selling DVDs or petrol. The generic name by which they are known speaks volumes: they are indeed “super” “markets”: big places where goods of various kinds are traded. I don’t recall seeing many wine merchants rising in solidarity with Levis when Tesco and Asda started to sell jeans at rock bottom prices, and I’m sure that there are a few members of the trade who succumbed to the temptation to buy a discounted copy of the latest Harry Potter in Tesco rather than support their local Ottakers. Ah, the wine experts say, the supermarkets are stupid. All they need to do is get their customers to trade up and we’ll all make more money. Given its evident inability to generate profits from its stores, Tesco clearly needs this kind of advice. Especially from traditional wine merchants, producers and writers whose ability to accumulate wealth is famous across the planet.

But that’s quite enough irony. If the supermarkets aren’t to blame, let’s throw the brickbats at the innately cheapskate British public who at least can’t answer us back. Sadly, this doesn’t quite wash either. There is plenty of evidence that the most tightly-wadded Brits can be persuaded to fork out more than is logical on a pair of Nike trainers or the latest iPod. And I’d argue that they do so for the same reason that the Americans and the Swiss and the Japanese all splash out on flash bottles: wine, and more specifically classy wine, is something to which a growing number of people in those countries aspire. Unlike Britain, the country where people earning two or three thousand pounds a week think a £6.99 bottle of wine appropriate to serve to their dinner guests on a Saturday night.

If you accept my premise that Britons aren’t generally excited by the idea of sampling finer – and pricier – wine, the blame surely has largely to be placed at the door of the people whose livelihood is derived from communicating with the public: the readers of this organ. While we hacks can share some of the credit for increasing UK wine consumption beyond anyone’s wildest expectations, we also have to take a corresponding amount of the responsibility for killing the aspirational quality that even Mateus Rose once enjoyed. We have helped to reduce wine to the level of beer or milk: a beverage most people neither have, nor wish, to think about very much. Value for money has become synonymous with cheapness. The very idea of a wine writer promoting a prestige cuvee Champagne as good value at £50 is almost unthinkable. But just switch on your television and watch half an hour of Top Gear. In one recent show Jeremy Clarkson and Steve Coogan were seriously debating the relative merits of the latest efforts from Aston Martin and Ferrari. Neither car would leave much change from £175,000, a figure both petrolheads freely acknowledged was a fairly considerable sum. But that acknowledgment didn’t reduce their evident passion for these gloriously impractical vehicles. Watching the two men throw the cars around the track should have moved any but the most pedestrian of souls – which helps to explain why Top Gear is such a popular programme. Of course Clarkson and the gang also have to cover more workaday vehicles; earlier in the same show, he explained that viewers had requested advice on which sub-£8,000 hatchback to buy. So, a pair of runabouts were duly and very, very rapidly recommended - in much the way one of us might name a drinkable £3.99 supermarket cava, or a cafĂ© that produces decent sandwiches.

I loved Clarkson’s admission that cheap, good-value-for-money Japanese hatchbacks don’t get his juices going. Maybe if more of us took the same approach to wine, and allowed our enthusiasm for the vinous counterparts of cars that cost as much as a two-bedroom-flat in Leeds, we might encourage a little bit more courageous exploration by Britain’s wine drinkers. I am writing this a few hours after hearing Andrew Jefford hosting a discussion of luxury foods and drinks on Radio 4’s Food Programme. Inevitably, perhaps, the caviar, foie gras and Dom Perignon were tasted alongside dyed fish eggs, duck pate and Tesco Champagne. In each case, the guests – Sean Hill and Michelle Roberts – unhesitatingly identified and preferred the genuinely luxury product but, compared with Clarkson and Coogan, the enthusiasm was distinctly muted. I can’t imagine that the programme will have sent many listeners rushing out to experience their first taste of DP

For those people reading this who mutter “so what!” or rub their hands in glee at the thought that the greedy Champenois won’t be banking any extra pounds, I’d simply offer a few statistics. According to AC Nielsen, the rise in UK wine consumption has slowed to 5 or possibly even 1.5%, depending on the figures you choose, with sales of the top four brands now rising by 48%. In other words, if you’re not a big New World brand, you’re lucky not to be sliding backwards. It is, of course, always dangerous to assume that trends will continue, but if this one does, who’s betting that Tesco et al will take the logical step of trimming their ranges even further than they did in 2005. And Terry Leahy will have every justification in doing so: after all, he’ll be obeying his mantra of listening to his customers and giving them what they want.

Of course, there will be a backlash by people who want something a little different or better – which will be good news for Philglas & Swiggott, Wimbledon Wine and co, but that won’t help the overall picture. The opening of another opera house doesn’t slow the decline in the sales of opera CDs.

So, this is a call to arms. If we as British wine writers really do love wine from the foot of the mountain to the summit it’s time for us to share that love, passion and excitement unashamedly with a wider audience – and to admit that while some of the best things in life are free, some of the others cost a lot of money. And are none the worse for that.