‘Vintage 2000’ : Industry Holds Strategy Seminar to Bolster Sales in an Unfriendly Climate

THE WINE industry, rattled recently by federal and state health regulations, continues to fight to establish a positive image that will counter what wine makers feel is an attempt, by people they call neo-Prohibitionists, to lump their product unfairly with drugs. The climate for wine consumption is increasingly unfriendly: Bottles in California must be labeled with warnings about sulfites. Next month, they’ll also have to carry the U.S. Surgeon General’s warning about the dangers of consuming alcohol during pregnancy. And businesses selling wine must post signs with similar warnings.

Wine producers acknowledge that concerns about alcohol abuse, particularly by expectant mothers, are valid. Recent research has found that consumption of alcohol during pregnancy can cause long-term damage to an unborn child.

But the wine industry fears that these labels and signs will be misinterpreted by the general public, leading it to believe that even moderate consumption of alcohol can be dangerous.

The challenge for the industry, then, is to create a friendly environment for wine consumption among the many people who can safely enjoy its pleasures. “How can we change the image of wine from an alcoholic beverage often classified with drugs to a healthful, agricultural product?” asked Marcus Moller-Racke, president of Buena Vista Winery in Sonoma, at a recent two-day gathering of 400 media and wine representatives who’d come together to discuss strategies for bolstering sales. And how, asked others, can wine shed its elitist image and appeal to a broader range of American consumers?

Such questions take on a particular urgency when California’s $7-billion grape-growing and wine-making industry looks at declining sales of jug wines and wine coolers. And the questions were the focus of Moller-Racke’s seminar titled “Vintage 2000--A Strategy for Success.”

Two years ago, also on the eve of a harvest, Moller-Racke had sponsored “The Challenge to Succeed” seminar, during which speakers discussed the advances that had been made by neo-Prohibitionists. Apparently, he was convinced that it was time for another seminar.

As a fit symbol for Vintage 2000, a solid gold and platinum chess set encrusted with diamonds and rubies was displayed in Buena Vista’s entryway. The symbolism for the need for strategy in the high-stakes business of wine was clear.

At the seminar, participants watched a slide show that included spectacular aerial shots of wineries and vineyards. The audience responded: “Look! There’s Inglenook! That’s Monticello! Isn’t that Monterey?” Breathtaking close-ups of California’s wine country followed. A quick switch to a montage of interiors, bottling lines, packaging--then wine shop shelves and shoppers. And finally, newspaper headlines: “Wine Sales Show Sharp Decline” and “Wine Consumption Linked to Drugs by (Surgeon General) Koop.”

The need for a new marketing strategy was evident, and suggestions were wide-ranging. “You’ve got to make wine fit into people’s lives, target a broader audience,” urged Robert Phinney, managing director of the California Raisin Advisory Board. “Raisins used to have a neutral-to-negative image . . . wimpy, lonely. Growers were hit hard with sad sales. Our dancing, singing raisins in the TV commercial have taken raisin sales up 20% to $70 million.” Commercial designer Walter Landor said: “You must loosen up people’s willingness to explore (wine).” To illustrate his point, he showed a slide depicting a glass of wine with an apple pie, a hot dog, a hamburger and a baseball.

One category that is showing increasing sales is that of premium wines; consumers seem to be drinking fewer but better-quality wines. “American consumers are affluent, coming to live like Europeans, with a new understanding, in which high quality is better in value sense,” said Marshall Loeb, managing editor of Fortune.

Although sales of premium wines are up, neo-Prohibitionists have gained ground. Barry Sterling, chairman and partner of Iron Horse Vineyards, acknowledged their advances. “Much of the damage (suffered by the state’s wine industry) today is at the government level.” He added that many organizations have been formed by different segments of the industry for the fray. But so far it all seems to be shadow-boxing, with nary a knockout scored.

Loeb said: “We are now facing economic, social and political revolution. Those who ignore these changes will stagnate and wither.”

Yet, the seminar did not result in concrete plans to effectively counter neo-Prohibitionists’ moves. Instead, participants left, promising to attempt to make Americans more comfortable with wine and eliminate its elitist image. With battle plans and strategies still needed, Moller-Racke doubtlessly will feel the need to hold another strategy seminar two years hence.