I was intrigued as I began reading about Mondavi and its purchase by Constellation. It reminded me that one of my favorite breweries, Ballast Point, was recently purchased by Constellation for $1B. Other breweries I have loved--Goose Island, Breckenridge--have been selling off at ridiculous prices to huge brands and I'm always conflicted. On one hand I get excited by the prospect of greater growth and exposure of products I love, and on the other, I recognize that that product is no longer the same I fell in love with. I instantly assume that quality will go down and recognize that so much of my love for that brand--take Breckenridge, for example--came from the fact that it was locally owned and operated. When I lived in Chicago, the amount of pride people felt drinking their 312 in the summer was instantly colored by ABInbev's acquiring of Goose Island. Because wine, and beer for me, are so deeply related to their story and their history, them turning corporate becomes instantly disappointing.
I felt the same way when Constellation purchased a brand I love, Meiomi, from Joe Wagner this past summer (thanks Emily for forwarding that notice back in July). I'm curious to learn this quarter about how to balance the fact that these brands are businesses but are also more than that to their customers. How can these brands scale and professionalize while still maintaining the connection to the place that made them into what they are? Do customers care if they're not Napa or family owned? How can they convince customers of their quality when we know how scale affects production choices? How can they still feel special and unique if everyone gets to know about them? As a loyal customer, acquisitions feel like the loss of the brand. I'm excited to learn more about why that may not actually be the case and the business of that risk.
Riley - your question is a poignant one, and it is something I continue to struggle with. I find myself drawn towards the stories and the passion behind small, family-owned wineries that have been producing for generations - the way Mondavi began - and even take the unique qualities of their wines as an intriguing art form, almost as an additional characteristic to overall wine "quality." I have also had experience with some of the bigger wineries, with much more acreage, where everything is automated & the love and care that goes into the vineyard is not quite the same. Tasting at these vineyards is also often a very different experience - the owner is usually not there to share his or her own bottles (sometimes not even on the tasting list) and to tell the story behind the winery; at larger vineyards, it is often interns or college students who staff the bar, and despite their enthusiasm they are not able to convey the authenticity - and pure inspiration - of the owners and winemakers themselves. That said, many of the larger wineries are able to produce more consistent vintages for the price point. There are likely many different reasons for this, but the more acres you have, the larger volume of grapes, and this creates more options for the winemaker - especially when it comes to reserve wines. But I continue to struggle with my own (biased) perception in favor of small, locally owned wineries as compared to the larger conglomerates.
ReplyDeleteWe will discuss these issues if "authenticity" when Prof. Mike Hannan guest lectures. Raise these points!
ReplyDeleteThis is a question I thought a lot about, especially this summer when I was working at Duckhorn. Duckhorn takes a "be big, act small" approach that allows them to preserve some of the cache and feeling of a family winery. This is done largely through the tasting experience at the winery sites. A company I've been fascinated by is Huneeus group that owns a family of brands including the Prisoner, Quintessa, and Flowers. They hope to preserve the small winery feel in part by having one brand manager for each brand. This creates an inherent tension: if you manage each brand separately, can you actually achieve economies of scale that make wine groups more profitable than individual wine brands? It would be interesting to explore how wine groups around the world try to thread the needle between authenticity and efficiency.
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