Where Will the Wine Industry Be Led
Last Thursday at the Women for Winesense annual “Women in Wine” event, three remarkable women came together on a panel to chat about their views of the wine industry, offer some personal observations and inspire the crowd of 100 or so people at Buena Vista Winery in Sonoma. I was honored to moderate the panel. Since that evening I’ve not been able to get one comment made by one panelist out of my head.
Michaela Rodeno, owner of Villa Ragazzi and former head of both St. Supery and Domain Chandon, was one of the three panelists. She made the following observation:
There is a lack of leadership in the wine industry. Not since Robert Mondavi lead the industry and left us has a new leader emerged.
Robert Mondavi was undoubtedly a leader of the California wine industry. He provoked and prodded California wineries to believe in quality and produce quality and to do what it took for California as a whole to take its place in the world as one of the quality wine leaders. And the industry did just that and did so under his leadership.
I wouldn’t want to speculate on who now, some years after Mr. Mondavi left us, could step up and lead the California wine industry. What’s more interesting is where that leader might direct and take the California wine industry.
All three panelists last Thursday, including Michaela, Claudia Schubert—President of Diageo Chateau and Estates, and Gina Gallo—Winemaker for the Gallo Signature Series, spoke of the critical importance of innovation. Would a leader of the industry call for and lead a new sort of innovative approach to sales or marketing or even winemaking? I don’t think the latter is where this leader would take the industry. Winemaking is largely a matter of science and understanding our natural surroundings and innovation in this realm tends to proceed at a steady pace when capitalism is the driving force, with or without a leader.
This leaves, potentially, sales and marketing innovations. The great innovations over the past 25 years has been direct sales. Direct to consumer sales and provided the basis for an explosion of brands that the three-tier system of distribution could never have handled. The explosion of new wineries and the great wines that have emerged from these wineries was fostered in spite of, not due to, the three-tier system.
Ms. Rodeno cited the Internet as one of the most important changes that occurred and emerged during her forty years in the industry. Is there room in the realm of communications for a notable, wine-centric innovation that one leader or another might foster?
I don’t think this qualifies either. Despite the importance of the internet for reaching new consumers and disseminating information, the wine industry has been notoriously slow in adopting new marketing and communication technology to move the industry forward. There are individuals who are pushing the rock as hard as they can as they try to move the industry forward where the Internet is concerned. But even their heroic efforts seem most often to meet with either resistance or inertia.
Perhaps a new leader might be inspired by notable improvements to logistics technology and redirect the attention of producers on retailers, asking them to give more margin to those who sell their wines to the consumer by selling direct to the retailer. The problem with this scenario is that it would take a rejection of the wholesale tier, punishing it in effect for not driving efficiencies. I find this scenario somewhat unrealistic, despite its appeal.
Perhaps it is altogether unreasonable to even consider how a new leader would inspire the wine industry. The fact is, during Mondavi’s tenure as the undisputed leader of the American/Californian wine industry, there was a certain commonality among the wine producers, the wholesalers, and the retailers. During the 1960′s, 1970′s, 1980′s and into the 1990′s most wineries asked how they could get their wines into the hands of consumers via the wholesaler/retailer route. And there were few huge wineries and many fewer tiny wineries.
Today the industry seems divided into types and sizes and interest groups each contending for a particular slice of the marketplace, while fewer and fewer giant wineries monopolize the wholesalers attention. How does a leader corral such a diverse industry and send them down a single path singing the same tune? I don’t know how, nor what the path might be pave with.
There was a great deal more that came out of the “Women in Wine” event last Thursday that provokes contemplation. It was a seminar in the wisdom of success as epitomized by Michaela, Claudia and Gina. But it is this issue of leadership, the current vacuum and where a new leader might take the industry that sticks with me and confounds me.