Firstleaf and the First Rule of Wine Marketing—Tell The Truth
I’ve been tough on the Natural Wine category in the past. I think I may have called its champions “charlatans” and labeled them “frauds”. But I wasn’t talking about the wines. I don’t think they are any better or worse than other wines. I was primarily concerned with the way the champions of Natural Wine practiced Denigration Marketing: the act of denigrating your competitors for your own profit.
But Natural Wine champions aren’t the only folks who practice this particularly crude kind of marketing. Take Firstleaf wine club, for example.
Every time I log on to Facebook I see the advertisement I’ve placed here on the left. See what it says? “Your $20 bottle of wine is worth $3.” They have another very similar ad that claims “Our $5 wines are better than most $50 wines.” Whatever. You can’t argue with taste. But it says something else too. Something that is a lie and it’s something that absolutely seeks to denigrate others.
“When you buy wine in a store, you end up paying 3 times more than what the winery originally sold it for. Middlemen, such as distributors and retailers, mark up the price of the wine to cover their costs.”
This is bullshit on a number of levels. What’s worse is that Phillip James, the founder of Firstleaf and the person responsible for that little turd of a statement, knows it’s bullshit. And yet he still approved it for his ads and his marketing materials.
Let’s just walk through it real quick. A winery sets its retail price for a wine. Say, $50. That’s the price they sell the wine for at the winery or on their website. When they sell that wine to a wholesaler that wine goes out the door at $25—the “FOB” price. The wholesaler then marks it up to the retailer 50% to about $38. In order for that wine to sell for “3 times what the winery originally sold it for”, the retailer would then have to price it at $75—double the price they paid the wholesaler.
Retailers don’t do that. At most they might mark that wine up to $55. But more than likely it’s going to be priced in the $45 – $50 range.
Firstleaf is telling its prospective buyers that retailers are gouging customers in order to make a profit. In reality, it’s Firstleaf that is denigrating retailers in America by twisting the truth in order to pocket coin for themselves. And they are doing so in a way that is worse than the Natural Wine charlatans who imply that any other than their wines are unnatural. Firstleaf is not telling the truth.
But what exactly is Firstleaf selling anyway? What is this wine that at $5 is better than most $50 wines? Here’s what FirstLeaf says about the wines they sell to their customers and club members:
“At Firstleaf we are fortunate to get to work with all kinds of winemakers and vineyards. Winemaking is a collaborative experience, and our experts love seeking out passionate people making quality wine.”
Fair enough. Let’s look at their most popular winery: Hawthorne Grove. Here’s what Firstleaf has to say about this storied estate:
“Hawthorne Grove Winery has won numerous silver medals, five gold medals, one double gold medal, and was even voted 2016 Monterey County Winery of the Year on the strength of only their first four wines. Every release is a stunner, and we can’t wait to try anything they send our way.”
First of all, “Hawthorne Grove Winery” is a brand, not a winery, according to their federal certificate of label approval. It is owned by a company called Penrose Hill. Penrose Hill was created by the Firstleaf folks. So, I’m willing to bet it’s true that they really “can’t wait to try anything [Hawthorne Hill] sends our way.”
The address of Penrose Hill is 499 Moore Lane, Healdsburg, California. That’s the address of Rack and Riddle. It’s a custom crush facility that makes private label wine. Now, while I’ll grant you that Rack and Riddle IS a winemaking facility, there are no hawthorn trees in the vicinity. There is no grove of trees in the vicinity. There is no history of the spot being peopled by the “Hawthorne” clan. There is however a highway on one side as well as Jacks Auto Repair on the other. And don’t get me wrong. I’m not seeking to denigrate Jacks Auto Repair by association.
As for that “2016 Monterey Winery of the Year” claim….didn’t happen. Mystic Hills Winery won the 2016 Monterey Winery of the Year. (Since corrected. See comment section).
It’s not necessary to lie to sell wine. In fact, I bet all those wineries whose $50 wines are so much worse than Firstleaf’s $5 wines don’t lie in their marketing. What’s necessary…what’s the absolute very least that you have to do to sell wine is tell the truth. That’s the first rule.
In the end, it’s not Firstleaf’s stubborn relationship with the truth that should concern others in the wine industry. It’s not their willingness to claim awards they haven’t earned. It’s not their willingness to parlay a made-up label into a hard working winery. It’s their willingness to denigrate others in the industry in order to try to create cachet for themselves and their private label wines that is particularly despicable.
I’ve worked and still work with lots of retailers. I don’t know a single one that would base their consumer outreach on claims that other retailers are hurting consumers. I don’t know any retailers that would badmouth Firstleaf for their loose relationship with the truth. And it’s not that I run with a crowd of particularly upstanding retailers. It’s that I associate with a group of retailers that are committed to doing the very least that morals and ethics demand of them.