Sunday, January 23, 2011

How to sell your wine to America

This week in New York during the Italian Trade Commission event, Vino 2011, there will be many folks, from Italy and the USA, converging for several days of intensive Italian wine learning, tasting, and hopefully, selling. In the spirit of this event, this piece is posted in the hopes that I will be able to send folks to a place to answer the question, “How do I get into the American market?”


I keep getting emails from Italian wineries and their agents who seem to think that just having good wine is enough. Once again, I am going to lay out the roadmap for them with how I think they should approach selling wine in America. In this post, in no way am I attempting to disrespect anyone in Italy. Actually I am attempting to give you a million dollars’ worth of advice from one who deals with this on a daily basis and has done so for many years. The main fault with this advice is that is it unsolicited and it is free. And as everyone knows, volunteered advice at no cost carried with it is of no value. But I am an idealist and, if for no other reason, I can direct the hundreds of people who knock on my door (or blast me with email) if the conversation should go beyond the delete button.

You have a beautiful wine. It has hundreds of years of tradition. It embodies innovation. It belongs to a wealthy or powerfully connected family in Italy that has influence in its society. In other words, it is a bulletproof formula for success. Right?

Let’s say you are in Tuscany, for many of the emails originate from this region. The region has large production, but unlike Puglia or Sicily, it has been doing business with America for many generations. The Tuscans are smart, shrewd businesspeople who have held sway over banking and economies for hundreds of years. They are good at that and are also adventurers out into the world. So they have some momentum.

But Tuscan wine, in the beginning of the 21st century, is in crisis. First, there are the scandals. Then there are the changing laws, threatening the perception of traditional wines. Then there are those who have formulated the wines to capture high marks in the press. And there is the pride in the product and, usually, there is an element of class. If a wine isn’t priced high enough, there won’t be the requisite respect attached to the perception of that wine’s value. It won’t be considered a luxury item or a status symbol, like a Ferrari or a Maserati, A Gucci or a Prada.

That is a problem because, in this period, luxury isn’t fashionable. Conspicuousness is out of fashion. Value is back in the driver’s seat. Thank the global availability of wine, thank Thomas Friedman's "flatter world." Thank Italian clothing companies who set up shop in China.

What the world needs now isn’t another Super Tuscan selling for above $30 on the shelves in America. Few care who has owned the property for 300 years. We are all the center of our own universe, and America (or Italy or China) isn’t any different in that practice. It’s a self-survival mechanism – to make our world livable by making one feel like it is in a scale we can comprehend and live with.

Scandals come and go, but laws can change things for a longer period of time. Tuscany (and I am sorry Tuscany, for singling you out, but you are a major importer to America and you should be hearing this too, not just the Veneto, Sicily, Abruzzo and Puglia) has changed their basic wine laws for Chianti to a point where one cannot get an answer from even a consorzio president as to how the laws have changed. Believe me, I have tried. It’s a mess. But then again, how difficult is it to figure out something as simple as how many DOCG wines there are? I have made a study of it. People come to this site for the information. It drives a lot of traffic. And I know there are probably one of two wines that I haven’t heard about that should be on this list [insert the post here as a link]. So laws make it difficult for Italians to know how they should comply in their area.

The whole luxury/class/status thing, in America, is so different from Italy as to have no mutual meaning for the two societies. At a recent meeting in Rome with a government official of the Italian trade commission at very high levels, there was a lengthy discussion of the Italian love for luxury brands. The Italian affection is different than the way Americans select their products and adornments. The simple answer is: It just isn’t as important. Don’t market your wines using status to a country until you figure out what is important to them.

The traditional vs. innovative debate is as murky as the “natural” vs. “designed” skirmishes that blogs and publications wax on ad infinitum.

“If I hear from a producer that their wine respects their centuries-old tradition while also embracing innovation, I hit the delete button. End of discussion. Get a new line.”

In these days what is important? Organic (not fake or “applied” but really intrinsically organic) is important. Sustainable is too. Carbon footprint is making pathways into our collective consciousness in America. (Finally, when 5% of the population consumes 25% percent of the world energy, something’s got to give, eventually.) Value ranks, sometimes higher than a 90+ rating. Remember this is the land of Wal-Mart, so it better be organic and not cost like a Ferrari. Or an Audi.

Scale – if you make 10,000 bottles of wine, do you really need to be in America? Is it worth the time and the effort and the expenditure of energy? Really? Does it matter that much if you are only in 23 countries rather than 24? Do you really understand the complexities of state laws, the transportation issues, the various legal issues, label-approval issues, compliance and infrastructure needed to “make it” in America? If these words seem confusing to you, don’t look to America to sell your wine.

The relationship factor – Do you have the time and the warm body to send to America – to live, not to just visit during off seasons in Italy, and to work and travel constantly, building those relationships which will most likely take a generation? Again, if this sounds incomprehensible to you, don’t look to America to sell your wine. Because in the 21st century, the business of selling any wine means, at this time, going through wholesalers and distributors and they have been consolidating for 25+ years. And yes, there are plenty of small, mom-and-pop operations around the country, and that might work for you. But again, unless you are willing to sacrifice your first born to come to America, to become an American and work and live and make it happen, don’t dream any further.

By the way, there are those people who are making that commitment along with the generations of Italians, such as my grandfather’s and grandmother’s, who left all they knew and loved behind to reach their goal. If you want to do this, you will need one of yours or a person as close to your family as you can gather, who will re-settle in the hinterland of America (not just NY or LA). Oh, and you might not wan't to take all of the month of August off to relax. Your competition won't.

I personally made that sacrifice 30+ years ago, too, so I am not asking any of you to do something I did not ask of myself. But the relationship piece is probably the most important element. More important than tradition, than status, than price. I know what I am talking about.

Learn to love the road, because it is on the road where all of this grows and flourishes. My friend, Eugenio Spinozzi, who passed away five years ago, was on the road for 25+ years. It wore him out. But he helped to build the business of wineries that is still intact long after he has gone. And yes, there have been many during his life and after who also helped and were instrumental in that growth. But he was the face, he was the relationship-factor that put it in play (By the way, he was terrible with numbers).

Inhaling, taking one last breath before we head down the slopes. I can see the finish line. And you can as well, and not only finish, but win the battle to sell your wine in America.

Think positive, but have long term realistic goals. Know the culture you are pitching is different from yours. You don’t have to learn English, but a study of the American culture is indispensable. Look, when my grandfathers came here 100 years ago, there wasn’t the infrastructure and the communications, and the opportunities, which exist now. The difference is, today, there are too many choices, too much information, maybe even too many opportunities.

Narrow down your focus, in the beginning. Choose one state, two cities, three wines, keep it simple. There is still room for Italian wines in the Victory Garden. But you’ll need to bring your shovel and dig in. If you want to still be here in 100 years.



3 comments:

Anonymous said...

Don't bother sell to America if they make <10,000 bottles? AC, such is the perspective of one who works for a giant company. We're doing fine with those little "chicche" (gems), thank you very much. And as to the daunting bureaucratic hurdles the producers face, they have us to deal with it all.

From my tiny-company perspective, I'd ask the producers, large or small, not to compromise (your "we're traditional but innovative comment, which tells you immediately what you'll get in the glass -- nothing good). If they were like everyone else, we wouldn't want them.

I'd ask them not to expect to take junkets to NYC and the Bay Area and say they've done America. They need to visit Ohio and Tennessee and other unlikely markets.

I'd ask them to get serious about stuff like deadlines and pickup dates. SERIOUSLY serious. And, yes, get back to work in August and between Nov 15 and Epiphany

And as to pricing -- if I hear one more time about the important bottle or important wine, I'll start raving. Just make sure the stuff you send us is as good as the samples we tasted in Italy and at our NY office. And hear what Ac et al are saying re: "luxury" and real-world pricing. I'm happy if you get the Swedes to fork over 12 euros for your wine. We'll take it for 5 and you'll thank us.

Strappo

Anonymous said...

Strappo, 'sounds like you're more in agreement than not w Alfonso's ravings. Small or large, Italian winemakers aspiring to sell in the U.S. market need to learn more about it and develop realistic expectations. Glad you're there to help the littlest guys. Me, I'm just an "On the Wine Trail" groupie.

Marco Montepulciano said...

The myth of the eternal return seems to echo upon the walls of the Italian wine cellars.

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