XChateau Wine Podcast

Wondering why there was only beer and spirits but no wine at Crossfit events and races, Mark Warren and Tom Beaton, Founders of FitVine, decided to start their own brand. With a goal of making wine more transparent and approachable, FitVine aims to “fit into your lifestyle.” At the $15-20/bottle price point, FitVine is bringing more Gen X and Millennials into the wine category with wine that tastes good and takes away the stuffy image of the wine industry.

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Detailed Show Notes:

• Mark and Tom’s background
  • Met ~20 years ago, both in the tech industry and entrepreneurs
  • They have always been into wine
  • Both former athletes got into Crossfit 2 decades ago at events. They saw spirits and beer but no wine and asked, “why isn’t wine part of an active lifestyle?”
• FitVine’s founding
  • At $15/bottle - many wines are overprocessed
  • Target a “healthy” lifestyle, and the word “fit” means how does wine fit into your lifestyle?
  • Want to have a positive impact on people’s lives - relieve stress
• Market segment
  • Initially thought they were targeting the athletes, but quickly learned it was the significant others at the races & events, the “aspirational group” that wanted to make better choices that were FitVine’s customers
    • Gen X “yoga mom/dad,” Millennials M/F both increasing
    • DTC business has customers from early ’20s to late ’70s
    • The segment is ~85-100M Americans
  • FitVine vs. “Clean Wine” - try to be careful and not knock other wines
  • Focused on 90% of the wine market and what people are drinking with an average ~$15/bottle price point
  • Trying to establish a “go-to” brand people can trust and remove confusion for people without wine knowledge
• Marketing
  • Targeting the average consumer who’s not wine knowledgeable and intimidated by wine
  • Trying to be more transparent and make it easier for the consumer
    • Have nutritional breakdown for all wines
    • Publishes calories, carbohydrates, sugar, alcohol
    • TTB stopped their ability to add more nutritional information (e.g., resveratrol, etc.) because it might show it as a healthy product
    • Does full lab tasting on all wines and have done competitor lab testing as well - sometimes show summary statistics (e.g., 90% less sugar than the Top 10 wines on the market)
  • They took tasting notes away not to confuse the average consumer
  • Start with the wine first, then discuss the positive attributes of the wines
  • Wine often marketed as too “stuffy,” makes it intimidating
    • Want to change the approach, a higher level of YellowTail - which was easy and popular in the $5-8/bottle category
    • At $15-20, more of an investment, wine needs to be good
    • Primary differentiation is transparency - there are no more faces to the big brands/wine companies, the last one was Jess Jackson
    • Want to be very approachable - no beige chateau or river on the label
• Products
  • Low in sugar but “full” alcohol
  • People want the alcohol in wine
  • Alcohol also impacts the taste of wine - de-alc’d wine often tastes “thin”
  • Low in tannins and histamines
    • Tannins can be added, but none for FitVine
    • High tannins are not suitable for non-seasoned wine drinkers looking for approachable wine
  • No flavor additives (e.g., Mega Purple) or other additives
  • “Triple Filtering” of wine - uses crossflow filtration that passes through 3 times (standard crossflow process)
  • Wines are not bulk wines, controlled from grape to bottle
  • Mostly Lodi fruit, sustainably raised with no pesticides
• Production
  • 2021 - ~425k cases
  • 2022 - ~600k cases
• Go-to-market strategy
  • Started DTC only
  • Started with social media
  • Went anywhere, people would let them pour wine (e.g., yoga studios, gyms, etc.)
    • Gave out samples and postcards to drive to the website
    • 2021 - still did >5,000 events
  • Went consumer first vs. pushing through distributors - Whole Foods called in 2016 - brought into retail in 2017 (started w/ 4-5 stores, then spread across the US)
  • 2022 - will be in 25,000 locations in the US, ~35,000 in 2023
  • Now focused on grocery stores and delivery (e.g., Instacart, Drizly, GoPuff)
  • Strong repeat buying
  • DTC offers limited-run varietals, which allows the testing of new SKUs before distribution
  • DTC has stayed level (now <10% of business), wholesale has seen significant growth
  • 2017 -...

From being body checked at a La Paulee tasting to responding to detailed questions from noted wine counterfeiter Hardy Rodenstock, Maureen Downey, CEO of Chai Consulting, tells us about the long road to becoming one of the world’s leading experts in wine fraud. Maureen gives us insight into the global world of wine fraud, what’s being counterfeited now, and how she’s pioneering methods to authenticate wine with The Chai Vault. A must-listen for anybody interested in collecting or investing in wine!

Detailed Show Notes:

• Maureen started in wine auctions in 2000
• Learned about counterfeit wines from a counterfeiter - Hardy Rodenstock asked for a lot of details about bottles that were being sold in auction
• Rudy Kurniawan case - helped track counterfeit bottles, worked with the FBI, and worked with a group of international wine fraud experts
• Counterfeit wine market - it’s in the Billions per year, vast majority sold privately, by brokers, retailers, NOT the auction market b/c auctions are the most visible source of counterfeits
  • Estimates 20% of all wine sold is counterfeit - supported by Interpol, consistent with other high-end products
  • Lots of IP infringement, low-end wine fraud (e.g., Rose in the South of France)
  • Modern trend - counterfeit current, recent production wines
  • Most counterfeits come out of Europe (hot spots: Switzerland, Italy, France, & Belgium)
  • Asia
    • High-end buyers in Asia assume something is counterfeit until proven real
    • Flooded with fakes from the US when markets first opened up
    • Mainland China - high import taxes leads to the use of “coyotes” (import smugglers) for old and rare wines, and have little recourse for counterfeits
• Hard to know what old wines taste like - even some wine critics tasting notes may be based on counterfeit wines made by Hardy Rodenstock and Rudy Kurniawan
• Main methods of counterfeiting
  • Digitally printed, current production wines
  • Can re-fill real bottles of wine
  • Sassicaia counterfeit ring was recently broken up - they got proprietary glass, capsules and made excellent copies
• There is a big need to track the supply chain to identify and prevent fraud
• Tips for getting real wine as a consumer
  • Makes sure retailer has not had problems in the past
  • Get to know the people at the wine merchant
  • Ask questions and demand answers
  • Get to know a consultant and have someone vet the wine first, not after
• Latest information on wine fraud found on Wine Berserkers and winefraud.com
• Systems producers use to protect against fraud
  • Prooftag - this is mostly cosmetic, can be digitally printed, and needs proximity to the bottle
  • The Chai Vault
    • Wines input into blockchain secured system, can be accessed anywhere in the world -> helps with supply chain tracking
    • Has an NFC chip underneath capsule that can get read; for secondary market wines, puts a PVC overlay over capsule which cannot be read if the capsule is pierced
    • 2nd generation of NFC chip coming out Jan 2021- very low failure rate, better antenna for longer range
    • Costs - $8,500 for bottling line additions + pennies per bottle (starting point, costs more money to add transfer of ownership and other features)
• Authentication adds ~20-30% to the value of wine (based on Domaine direct auction sales)

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Jeff Zacharia, President of Zachy’s, the global leader in wine auctions, tells us about how they made wine auctions more fun, have been moving to studio sales and bidding parties without live auctions, and how they narrowly escaped being swindled by Rudy Kurniawan’s wine fraud scheme. We learn all about the wine auction process, what regions are trending, and where he sees the market going. Don’t forget to rate and review XChateau wherever you get your podcasts!

Detailed Show Notes:

• Zachy’s founded in 1944 by Jeff’s grandfather, Jeff joined in 1983
• Zachy’s wine auctions started in 1995 when wine auction became legal in NY, started with a partnership with Christie’s, and then went independent in 2002
• Expanded to Hong Kong in 2008 and London in 2020
  • London is to expand in Europe, believes it is underserved from a wine auction perspective
  • Having wines in Europe enables quicker delivery for European customers
• London was the wine auction capital, then became New York, then Hong Kong, now it’s in between New York and Hong Kong
• Auction Process
  • Send a list of wines, get a low and high estimate, sign a consignment contract
  • Organize wines to Zachy’s warehouse, catalog wines in detail (including fill, labels, etc....), and print catalog, either electronic or print
  • 3 methods of auctions - live auction, studio sales (live auctions online), and internet / timed sales
  • Zachy’s differentiation - great effort in researching and inspecting the wines
• Auction Market
  • Saw steady growth year over year, with a spike in 2019 due to big sales
  • 2020 - beating projections (12% above projections)
• Zachy’s leadership - how they became the #1 wine auction house globally
  • Wine is all they do. They are focused and passionate about it
  • Jeff has been in the wine business for 40 years and built deep, long-term relationships
  • The team has invested years building their relationships with collectors and wineries
  • Innovations - centered around making auctions fun and engaging
    • Changed from the classic auditorium-style auctions to restaurant-style with food and wine
    • Bidding parties - often for studio sales, smaller gatherings around the world (e.g., Sweden, London, Germany, China, Hong Kong) that have the same food and wine atmosphere connected via Zoom to the auction
    • Investigating how to make virtual auctions more interactive
• Auction business model
  • Currently focused on buyer’s premium
  • May have seller’s commission, but depends on consignment size - the larger the consignment, the smaller the commission; substantial sales may even have rebates from the buyer’s premiums
  • Getting more consignors is the challenge currently
  • Expect prices to continue to rise - quality keeps rising (especially weaker vintages), and more collectors out there for a relatively inexpensive luxury
• Growing auction markets - Burgundy remains strong, some growth in Champagne and Rhone, California hasn’t yet gotten traction - potentially due to a different style of wine than those who are buying Burgundy
• Provenance premium often from ~20-200%
• Producer direct - can introduce or reintroduce wines to Zachy’s buyer base, sharing these wines for them to taste, and another way to help build the brand
• Scores declining in importance with more wine critics
• To be auctionable - need quality, rarity, and fashionable - what people are looking for
• Rudy Kurniawan story - bought a lot of wine from a Zachy’s auction and never paid, sent a list of wine to be sold in order to pay, but Zachy’s was uncomfortable with the wines (~60% seemed suspect) and rejected the whole consignment

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XChateau is a podcast about all things wine, from vine to your glass. We tackle the business of wine and keep you up to date with new and exciting developments in the wine industry.

In this episode, Robert Vernick and Peter Yeung interview Tom Lutz, Founder & Creator of Repour Wine Saver, one of the leading new inventions in wine preservation technology. We discuss the technology, how people have learned about it, the differences between Coravin and Repour, and what the future holds.

Other topics covered in this episode include:

• Tom is a chemist by trade (worked in biodiesel, aquarium products)
• Repour was invented when he had a newborn son and ended up pouring half bottles of wine down the drain.
• Technology:
  • Uses food grade oxygen absorbers
  • Binds the oxygen, of which the atmosphere has 21%, does not replace it.
  • Requires air to exchange and remove the oxygen, so the bottle needs to be stored vertically
• The capacity of the stopper
  • Built for 5 pours of one bottle, glass by glass - this would expose the wine to 1,500 ml of air.
  • The max amount a stopper has to handle is 2,000 ml of air.
• Uses recyclable materials. However, many municipal grids have 3”x3” grids that filter out small objects; for large customers, they do take back repours to recycle
• Pricing
  • Consumer: 4-pack ($8.99 / $2.25 each), 10-pack ($17.99 / $1.80 each), 72-pack ($120 / $1.67 each)
  • There are often promotions via the email list.
  • The future target price point is $1/stopper or lower.
  • Trade: 4x72-pack (288 stoppers) - starts at $0.83 / stopper
• Customers
  • Started with on-premise (restaurants)
  • With COVID - moved more to consumers.
  • Wineries - have been using for virtual tastings and wine club gifts, also several doing custom branding.
• Coravin vs. Repour - both work.
  • Coravin is better for tasting and cellaring wine.
  • Repour is for enjoying wine like you normally would and saving the remainder of the bottle for later.
• Marketing
  • Mostly word of mouth
  • After 1 year of testing the science, Tom started with a local sommelier group that did a blind tasting, and Repour worked great.
  • TEXSOM - gave out samples, and many conversations have come back to that event
• Duration of effectiveness - weeks or months, Repour has tested out to 6-7 months.
• The Future - potentially replaceable inserts, sparkling wine and possibly showing how much oxygen-absorbing capacity is left.

If you loved this episode, we would love for you to subscribe, rate, and review on iTunes or wherever you get your podcasts. Until next time, cheers!

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XChateau is a podcast about all things wine, from vine to your glass. We tackle the business of wine and keep you up to date with new and exciting developments in the wine industry.

In this episode, Robert Vernick and Peter Yeung interview Morgan Moore, Director, and Alex Fondren, Associate Director, of Glodow Nead Communications, one of the largest independent lifestyle PR agencies focused on hospitality, food and beverage, retail, and real estate. We discuss how wine is consumable art, the relevancy of trade magazines and wine critics, and how Glodow Nead creates partnerships between clients to develop great synergies.

Other topics covered in this episode include:

• Glodow Nead - started in the entertainment industry (“meat in seats”), the 1st West Coast agency to have offices in Asia (Singapore, Shanghai)
• Sample beverage clients: Plumpjack Group, Pine Ridge, Donum Estate, Seghesio, Bodega Garzon (Uruguay), Phantom Creek Estates (Okanagan Valley, Canada)
• PR firms - the primary job is to secure earned media
• Earned media - articles (or broadcast, social media) that are not an advertisement, has not been paid for or in exchange for the product; more trusted than paid media
• Wine is “consumable art” that can’t be compared to any other consumer product
• Wine critics are still relevant - for collectors, at point of sale
• Trade magazines shifting focus - Wine Enthusiast has been promoting celebrity wines
• Wine coverage has grown beyond trade magazines to other media
• 3 goals for PR firms for wineries: drive sales, brand awareness, & brand relevancy
• Business model: monthly retainer, 1-year contracts with a 30-day notice for cancellation; generally $5-20,000 per month
• PR ROI: give earned media the same value as a paid advertisement (e.g., a 1-page feature article in Travel + Leisure may be worth $5-10,000 as the cost of the equivalent advertisement)
• Article lead times
  • Long lead times - e.g., Wine Spectator works 6 months in advance
  • Medium lead times - e.g., San Francisco or Los Angeles Magazine work 3 months in advance
  • Shorter lead times - e.g., Wine Spectator Online works within the week
• Glodow Nead differentiation
  • More than just wine - can bring more stories to more journalists, including lifestyle publications
  • Global clients - journalists get more excited about the potential to write about topics globally
  • Partnerships between clients (e.g., hotels, resorts, celebrity chefs)
  • Big events department
• Example campaigns:
  • Plumpjack Winery - hired Glodow Nead because of entertainment experience - wanted to bottle their most expensive wine in screwcaps - the screwcap vs. cork campaign was one of the most successful ever
  • Flowers Winery - opened a new tasting room and articles about it drove traffic to their site
  • Partnership Examples: St Regis SF’s Polo Cup with Hamel Family Wines, Ritz Carlton Lake Tahoe, hosted high-end wine dinners and private dinners with wine clients, Napa Valley Wine Train hosts winemaker dinners and spotlight tastings
• Traits for good wine PR people - 1st be obsessed with media, then wine knowledge

If you loved this episode, we would love for you to subscribe, rate, and review on iTunes or wherever you get your podcasts. Until next time, cheers!

Hosted on Acast. See acast.com/privacy for more information.