Sunday, April 21, 2013

What's the value of a Parker point?

What's the value of a Parker Point? I suspect that to answer this correctly you might need to use a variant of the kind of slide rule I struggled with as a kid, way back in the dark ages of BC (Before Computers). I might be wrong but I can imagine that a five-point hike from 85 to 90 for a New Zealand Sauvignon Blanc might, for example, be worth a little less than a similar leap by a Napa Cabernet.

Thanks to an excellent article by Victoria Moore in the Daily Telegraph, I do now have one fairly clear idea of the difference in the value of a 95-point and a 100-point version of the same wine in Bordeaux. When Robert Parker tasted the 2010 vintage of le Dome, a new wave "extremely full-bodied" (Parker's words) St Emilion in barrel in 2011, he rated it at 94-96. On re-tasting it in bottle, he made it one of his nine 100-point Bordeaux of the vintage.

While waiting for the publication of Parker's verdict (a tense period well described by Ms Moore), Jonathan Maltus, the British creator and owner of le Dome was apparently contacted by a local broker wanting to know the impact each extra point might have on the price of Maltus's last 150 cases if Parker were to upgrade his mark.
Thinking on his feet, Maltus responded that he'd add 5% for every point up to 99, but couldn't decide on how much more he'd ask if the wine hit the 100-point bullseye. Subsequently, and just before the news that he had indeed achieved that top score was announced, Maltus took another call and declared that if he got it, he'd add a further 25% to the price he'd ask for 99-points. 

Earning the 100 points for the first time gave Maltus four glorious days during which he and his chateau were talk of the (local) town - and sales of some €750,000-worth of his wine (including bottles from his other properties presumably).

Reading this story sparked a number of thoughts in my mind.

First, and most obviously, there was the evidence - to the dismay of many Europeans and a fair few Americans - of how strong Parker Power remains in Bordeaux. Other tasters have, while impressed, been slightly less blown away by the 2010 le Dome. Neal Martin, Parker's own associate and the taster he once said he saw taking over from him, gave it 93 in bottle as, interestingly, did James Suckling and the Wine Spectator. The closest mark to Parker's was the Wine Enthusiast's 95. Whatever brouhaha there may have been over the Wine Advocate sale to Singaporeans and recent personnel changes, it was Parker's 2010 scores that made the weather.

Second, there was the simple fact that, unless my calculations are wrong, the extra five Parker points evidently raised the value of Maltus's wine by 50%. (I'm using "value" in the strict sense of the amount someone is prepared to pay for something).

Third, was Maltus's frank description of the direct link between points and price. Would I have come up with his 5%-per-point + 25%-for-the-100 formula? Probably not, because I'm a less canny businessman than he is; but I certainly don't blame him for proposing it. He'd have been mad not to have taken advantage of the opportunity, and to watch others cashing in on it.

Fourth, was the fact that Maltus still had 150 cases of the le Dome to sell, just under a sixth of the 1,000 he produced. If you were in his shoes, would you hold onto smaller or a larger proportion next time he feels he has a really good vintage?

Last, and buried away in Ms Moore's article, was the fact that while the initial enquiry came through one of the courtiers -  brokers - who as part of the traditional Place de Bordeaux system, handle almost all transactions between chateaux and local negociants - merchants, the final deal to buy those 150 cases was agreed directly between the merchant and the chateau. This reminded me that when Maltus first launched le Dome in 1996 - at a then outrageous price as I recall of £1,000 per case - he sidestepped the traditional Bordeaux network completely and sold it all exclusively through Justerini & Brooks in the UK. (At the time, he also deliberately kept it way from Robert Parker, wanting to build a market for it first).

Maltus has sold directly to a UK merchant; through a local broker and directly to a local negociant. How will he respond if and when he gets a call from a Chinese or Russian buyer who wants to pay a lot of money for a few thousand bottles?

The fact that I am hearing quite a lot of tales of chateaux that are now sometimes dealing more or less directly with big Chinese buyers (often through their own, or "tame" negociants) supports my view that, with every vintage, cracks are widening in the arcane way that Bordeaux is traded. The temple is not in imminent danger of collapse, but if I were a surveyor I wouldn't be giving it a great report...


  1. Initially selling the whole lot to one merchant brave enough to take a punt on it being the next Le Pin and putting an artificially high price on it is hardly "finding a market for it", is it? It's why it's never worked. Selling through the place at a realistic price would have found a market, and the wine might have found a following, no? Instead of just selling on points..

    1. I think one of us is missing the point here. What part of persuading a UK merchant to buy your entire harvest and to offer it at £85 per bottle does not involve "finding a market"? Especially as the same UK merchant came back for more the previous year.
      To say that it has "never worked" is debatable. J Maltus, a Brit with no track record of making ultra-premium wine, sold his entire harvest at an uprecedentedly high price. What evidence is there that he could have done that through la Place. That same wine - pre-Parker-100 was on offer at Farr for £2,500 per case.
      You talk about a "realistic" price. I'd say that the "realistic" price is the one people are prepared to pay.
      And, in the first years, as I made clear, he did not rely on points.

      I do not happen to be a particular le Dome fan, but I fail to understand how Maltus would have been better off doing everything through la Pace than selling in the way that he has.