A Short-Sighted Decision in Mendocino Wine Country—Inevitable?

ShortsiThe demise of the Mendocino County Winegrape and Wine Commission by a no confidence vote of its members is bad news for that region's industry. It also points to a perennial gulf that exists between the two fundamental elements of the supply side of the wine industry, growers and wineries, that is reliably difficult to bridge.

In the case of the Mendocino County Winegrape and Wine Commission, a promotional organization founded in 2006, reports have it that when the membership voted on whether to continue the Commission, wineries largely supported its continuance, while growers of grapes opposed it.

Alex MacGregor, the interim chairman of the Commission told the Santa Rosa Press Democrat this in the wake of the no confidence vote:

“I think ultimately, our county probably just wasn’t ready for the unique setup we had, which included both growers and vintners. It created some challenges.” This is an understatement.

At a February hearing on the Commission, Mendocino grapegrower Helen White, owner of White Oak Ranch, put a pretty clear voice to the apparant feelings of many grower members of the organization calling it "taxation without representation." After noting that she had paid $7,500 a year in dues to the organization for the past five years she claimed she had "received not a single nickel of value." She concluded, according to the Ukiah Daily Journal, "You cannot combine both growers and vintners. Growers pay more than 80 percent of the money and receive nothing. More than 99 percent of the commission  is used to promote wineries."

Most similar promotional commissions focus only on growers or only on wineries. And here's why: MendocinoCommissionGrape growers, who sell to wineries, naturally want to get as much money for their grapes as possible and naturally are most concerned with promoting their product to wineries. Wineries, on the other hand, buy from grape growers and want to pay the lowest price possible and are most concerned with promoting their product to consumers, retailers, restaurants and distributors. There is an inherent, basic and foundational conflict of interest. To make an organization that represents both growers and wineries work, it would have to serve the fundamental interests of all its members. This is not impossible, but it's not easy.

Wineries will argue, and it's not a bad argument, that every bottle of Mendocino wine sold supports Mendocino grape growers. This is true, but it's no solace to a grower who didn't get any direct payment for the sale of that bottle of wine and who may have sold grapes to the winery that did make the sale for a mere $1,000 per ton, or less. Clearly I'm not suggesting that growers ought to profit directly from the sale of a bottle of wine that was produced with their grapes that they were paid for, no matter what the per ton price was.

What I'm suggesting is that the "every-bottle-of-wine-sold-helps-the-grower" approach to organizing a promotional commission probably isn't going to satisfy growers, particularly if they are, as were the Mendocino growers, FORCED by law to contribute to the Commission. Rather an approach that seeks to aggressively promote Mendocino grapes to potential buyers probably needs to be an important part of any involuntary promotional commission that includes both growers and producers. The Mendocino Commission did set up an on-line grape marketplace, which was a great and obvious step to take on behalf of the Commission's grower members. But when 80% of your members are growers, as was the case with the Mendocino Commission, you are probably going to have to go beyond that kind of effort, which I'm sure the Commission must have in one way or another.

MendomapI've worked with regional promotional organizations in my role as a communications and media consultant, but never with one that was involuntary and state-regulated, nor with one that included both grapegrowers and winemakers. I do not envy Megan Metz, the executive director of the Mendocino commission, and the job she was tasked to undertake. One indication that Megan new what she was doing is the development of an initiative that will now never get off the ground.

In March, Metz hired the team of Mark Chandler and Steve Burns to "forge and implement a five-year marketing plan and build brand recognition" for the Mendocino wine industry. It's difficult to imagine a duo better suited and with more experience in this particular area than Mark and Steve. Mark spent many years as the brilliant director of the Lodi Grape Commission and can rightly be given much credit for the rise of that region's wines. Steve became known as one of the country's best wine organizational leaders through his work with the Washington Wine Commission and Washington Wine Institute. What we are talking about here is something of "dream team" for regional promotion.

The strategic plan developed by these two gentlemen will never be put into place. That's too bad. I personally would love to see this plan just for education's sake given who put it together and given the challenge of funding and inherent challenges associated with promoting the Mendocino wine industry, such as its remoteness from large metropolitan areas.

Regional promotional associations are not he be-all, end-all. They are not required for a regional industry's success nor for the success of an individual business within a region. But they sure do help. Like it or not "Mendocino Wine" is a brand. The degree to which it is viewed favorably by consumers directly impacts overall sales of Mendocino-based wineries. This in turn directly impacts the sales of Mendocino grapes  and the prices growers get for those grapes.

That said, Helen White, of White Oak Ranch, who complained in February that she has long paid $7,500 per year for years and "not received a nickel of value" from her investment in collective marketing, is somewhat better off now that the Mendocino Winegrape and Wine Commission is dead. She and other growers like her will save the $625 per month she has been paying to the Commission. Perhaps she will find a good way to put that to use to promote her own business.

But is the Mendocino County wine industry better off? They compete with now far better organized wine industries in Napa, Sonoma, Lodi, and many other regions. There are individual promotional organizations within the country that promote Anderson Valley, Redwood Valley, Yorkville Highlands and the Hopland region. They are going to have to step up even more now.

It's not accurate to say that the Mendocino Commission was doomed from the beginning due to its inclusion of both growers and producers as members. It is possible for these two competing groups to work together despite their often contradictory interests. But it made the whole endeavor a much more difficult undertaking and, in the end, proved to be what killed it. I agree with others that believe the disbanding of the Mendocino Winegrape and Wine Commission is shortsighted and probably detrimental to the economic health of this region's wine industry. Time will tell.


16 Responses

  1. Howard Hewitt - June 7, 2012

    I visited Mendocino a year ago as guest of the Commission. The wine region is spread out, some wineries hard to find, and as in any wine region – an interesting cast of characters. But they face a real marketing problem in many areas of the country. Mendocino wines make it to the Midwest but most consumers know little about the area. The Commission has worked hard despite changing leadership and marketing firms. The wineries would be well served to form their own marketing/promotional group and just move forward. There are some great Mendocino wineries, but they have name recognition issues off the coast.

  2. Jim Caudill - June 7, 2012

    It would be kind to say that there were organizational & staffing issues from the beginning that have a lot to do with this demise. While separate, Sonoma County is a great illustration of vintners & growers working together, Sonoma Valley too. It’s very short-sighted and unfortunate because, as you say, they might finally have had a team in place that could truly make a difference. Here’s hoping the vintners pick it up and run with it. See everybody at the Taste of Mendo in SF on Monday…or not?

  3. Rusty Eddy - June 8, 2012

    It’s sad that the Commission is dead. But it’s also true that the Commission was up against the same sort of infighting that existed in 1985 when I first arrived in Mendocino County. The more things change, the more they stay the same. Ultimately, one of the biggest challenges for this county is that 80% of the grapes grown here leave the county to be blended away in non-Mendocino appellation wines. That hardly helps build consumer awareness of brand Mendocino.

  4. Randy Caparoso - June 8, 2012

    Here, we are in agreement, Tom: winegrape commissions take a lot longer than 5 years to mature. As you say, the operative term is “long.” The Lodi Winegrape Commission is widely viewed as a huge success; but after some 22 years, only now have many of its long term goals come to fruition, and most of the goals are still in the process of being realized.
    Fundamental problems like the one cited by Rusty (80% of Mendocino grapes leaving the county, going into wine not carrying a Mendocino AVA) are precisely the type of issue only a full press grower/winery organization can address effectively; and again, it’s never something solved overnight. But given time, it’s amazing what can be accomplished. Again, you look at Lodi: 20 years ago there was zero “Lodi” identity; today, Lodi is extremely visible, and the consumer consciousness is international.
    So here’s hoping something can be salvaged. Speaking for Sommelier Journal: we have a joint project going on with MWWC, helping the on-premise industry learn more about the incredible grapes and wines coming out of Mendocino. The Mendocino appellation may have a little ways to go to increase its profile on restaurant wine lists; but thanks to MWWC’s current leadership, at least we’ll be one step closer to helping with that.

  5. Paul - June 8, 2012

    I agree that this was very short sighted on our part. As a Mendocino county grower I’m clear that we need an organization that promotes the value of the quality and unique elements of our grapes!! In order to do that the wines are the best vehicle to communicate this message.
    Now we are without- without a unified voice, message and messengers.
    It saddens me that we were not able to make it work. I am hopeful that we will find another venue and opportunity to work as the “Mendo Winegrowing Community “that is proud of our home, heritage and quality..

  6. William Allen - June 8, 2012

    Sad, but good article. I was fearful this would happen, and Mendocino has taken a big step backwards.
    There is no doubt, after working with, and observing, that wine marketing associations controlled by growers, as much as I love them, and not Vintners, generally fail at effective outreach, PR and awareness.
    The wine industry is already bad at understanding basic principles of marketing, branding, and PR, and is worse, which is fair given the agrarian background of most growers, when they dominate. Growers don’t sell the end product, and their long term success ultimately lies in the hands of the wineries. Period.
    You can look at regions like Paso Robles, or the Wine Road, as excellent examples.
    The Mendo Wine Commission has other challenges besides the classic grower-vintner divide; the wine regions were divided. MWC was viewed as a Redwood Valley/Ukiah centric focused organization, and the apathy of co-operation across the mountains, was a bit surprising as I witnessed it, on both sides.
    Megan did a great job IMHO. I made several press trips as a blogger, and became quite enraptured with the county, and now having a vintner component hoped to eventually source some fruit there.
    Have to also give them credit for trying to raise funds – I got a letter after my second harvest, saying if I used any Mendo grapes, I was supposed to pay xx, based on tonnage. Ballsy.
    I can only hope the wineries, across AVAs, will bond together. Mendocino has to compete for Bay area traffic with the many other surrounding regions of Napa, Sonoma, Lodi, Sierra Foothills, Santa Cruz, Monterey etc and is off the radar of many.
    Or perhaps the tourism bureau can step up.
    If someone doesn’t the newly gained ground will quickly be lost. Awareness and branding must be persistent, long term activities and goals.
    Last years Taste of Mendo was one of the best Ft Mason events ever, I was a bit bummed to see it move. I now have to miss Monday, due to last minute business travel, not sure if I am happy or sad, given this news.
    It will take a unique leader, and visionaries in all regions, to rally together the winemakers. And perhaps let growers have a contributing, but not dominating, role. It will not be easy, and I wish them the very best of luck. Cat herding wineries is not a task for the faint of heart, I know all too well.

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  9. Tim - June 11, 2012

    Very sad indeed, when any growers perceive zero value in an organization trying to boost the reputation of their home no one wins. Megan has done an excellent job and even with the dream team of Chandler and Burns…it is too bad the rewards of patience are not in place. American wine drinkers are growing every year and in the environment of extreme competition, Mendo HAS to play in the game or things will pretty much stay the same. Randy is correct -Lodi as an ava meant zippo 20 years back and now it is a “go to” place for zins, old vine reds, and chardonnay etc. I hope they can get it together in the near future…

  10. Tom Wark - June 11, 2012

    Tim:
    Isn’t the real AVA prize inside of Mendocino County the Anderson Valley AVA? As a pinot region it seems to have a great reputation.
    Tom…

  11. JohnLopresti - June 12, 2012

    Interesting post, Tom W. Perhaps, after the Mendocino Wine and Winegrape Commission’s dormant time, other entities with segments of MWWC’s goals could coalesce.
    Reflecting a bit on Rusty Eddy’s observation about fruit sold appearing in blends, I have recalled several quite well made wines whose labels, and winery tech notes, were tasteful enough to give credit to Mendocino county origins for a specific percentage of the fruit comprising the belnd. Sometimes the pricepoiont of those blends was in a tier competing with predominantly single-AVA wines from nearby counties.
    I have been out of the industry for many years. However, addressing the blend issue certainly appears to be quantifiably more significant for attaining the aims of an organization such as MWWC, as compared to, for example, how an amalgamated Commission in a neighboring county might proceed.
    Maybe it’s just early in northcoast viticultural and enological history yet for the genius of Mendocino winegrape industry people to coalesce around some worthy and important goals such as those Tom W discusses in the post.
    It seems I recall some 1970s stereotype difficulties that Sonoma County winegrowers encountered, as well, at a time historically when Sonoma county winegrapes were bringing quite a comparatively low price at the winery, if one considered the economics at that time in Napa Valley.
    I have enjoyed, as well, the ascending quality of some wines made with Lake county sourced fruit. These regions are developing quickly, although the vines produce results in a timeframe which lags quite a few years after vineyard establishment.
    Let’s see if mwwc can reconfigure.

  12. John Lopresti - June 12, 2012

    Interesting post, Tom W. Perhaps, after the Mendocino Wine and Winegrape Commission’s dormant time, other entities with segments of MWWC’s goals could coalesce.
    Reflecting a bit on Rusty Eddy’s observation about fruit sold appearing in blends, I have recalled several quite well made wines whose labels, and winery tech notes, were tasteful enough to give credit to Mendocino county origins for a specific percentage of the fruit comprising the belnd. Sometimes the pricepoiont of those blends was in a tier competing with predominantly single-AVA wines from nearby counties.
    I have been out of the industry for many years. However, addressing the blend issue certainly appears to be quantifiably more significant for attaining the aims of an organization such as MWWC, as compared to, for example, how an amalgamated Commission in a neighboring county might proceed.
    Maybe it’s just early in northcoast viticultural and enological history yet for the genius of Mendocino winegrape industry people to coalesce around some worthy and important goals such as those Tom W discusses in the post.
    It seems I recall some 1970s stereotype difficulties that Sonoma County winegrowers encountered, as well, at a time historically when Sonoma county winegrapes were bringing quite a comparatively low price at the winery, if one considered the economics at that time in Napa Valley.
    I have enjoyed, as well, the ascending quality of some wines made with Lake county sourced fruit. These regions are developing quickly, although the vines produce results in a timeframe which lags quite a few years after vineyard establishment.
    Let’s see if mwwc can reconfigure.

  13. William Allen - June 12, 2012

    Indeed the most well known. And least supportive of the Commission.

  14. Fred Nickel - June 13, 2012

    Sadly the final tally resulting in the headline grabbing ‘no confidence’ tag was much closer than most realize. Quite simply, had 10 of the growers who cast nay votes had even a modicum of what we envisioned at the outset, the MWWC would be moving forward with our long term goals.
    Even more sadly, only a shade over 66% of the growers eligible to cast ballots chose to do so. Sniff
    And I can’t resist, clearly the Anderson Valley does not consider itself part of Mendocino County anyway. You should have heard the furor when we considered conjunctive labeling requirements few years back… “Require a Region with our AVA!!! Mon Dieu!!!”

  15. Tom Wark - June 13, 2012

    Fred,
    Thanks for your comment. Regarding Anderson Valley, I think I understand where they are coming from. Of all the Mendocino AVAs, Anderson Valley has been the most successful in creating an identity for its wines and they clearly thought that the attachment of “mendocino” on the label would diminish that identity.
    That said, it is a sad development for Mendo County.
    Tom…

  16. JohnLopresti - June 14, 2012

    Perhaps, because of the relatively small size of the population of Mendocino as a county, the energy and economic strength required to develop along mwwc’s conceptual lines might be a longer process than the turnaround realized in neighboring Sonoma county over thirty years.
    The Anderson area is quite a new AVA. I can remember well a time when one of the first experimenters with viticulture in that part of the county emphasized gewurtztraminer, a varietal which had US marketing problems subsequently, although gewurz was one of my favorite premium winegrapes.
    Another factor which might have impact upon an effort such as mwwc’s to blend both grape grower and vintner within a sole mwwc advocacy organization, is a dynamic which I experienced in my work on the periphery of the labors of winemakers, grower relations executives, and the hierarchy of vineyardists: namely, the concept of there being tension over price/ton delivered to the winery at harvest is only a fundamental depiction. In reality, a grower who wants to produce ultra premium fruit may well be working from the time of vineyard plan development with the intended winery that will purchase the grapes, to help select clones, planting density, vine canopy training and management methods, cropload limits, irrigation regime, cluster management, as well as cover crop policies, including in-row. I have heard many an assistant winemaker fret about grower relations as harvest neared during iniquitous weather and some growers were trying to schedule pesticide applications of chemicals which would alter the spectrum of attainable fermentation characteristics. Of course, there is the perennial matter of timing of harvest, technique of harvest
    There are historical reasons for the slowness of morphing into modern viticulture after beginning with a tradition in other sorts of ag: growing orchards or raising cows and other livestock. Mendocino county still has a heritage of those earlier, non-grape economies and land management. These are interesting problems, but not easily coalesced, as I might imagine in trying to understand what happened with mwwc.


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