Neil Pendock at wine.co.za
writes a wry piece on the multi-lingual aspects of four letter words such as Love and Wine. Just for interest sake, he mixes in a bit of profanity. Very Funn.

I must confess that the first time Hugh suggested putting cartoons on labels, I was a bit unenthusiastic. You know, us uptight wine guys have issues with making wine anything other than hard to understand and difficult to pronounce. Let’s face it. a cartoon on our self-important, award winning wine, would border on blasphemy.

However, after about 50 million emails from folks all over the globe saying “Why don’t you put cartoons on labels”, I got over it and now it seems like my best idea ever 😉

Our first cartoon label, “Big Love” for Valentines Day is just hitting the Tesco shelves (only at the Tesco Extra mega-stores) and Hugh, Colin and our newest superstar, Catherine are touring around the UK, (they started at Inverness, and are working their way south) they are giving a lucky few, incredibly rare and valuable signed limited edition lithos., and Colin is filming folks on their views of what love means to them. Oh, and I can’t forget to mention that Hugh is on a quest to find the ideal Valentine, for himself.

In the last 72 hours Hugh and Co., have had about 10 radio interviews, several newspaper articles and it seems that The UK’s most influential blogger is being transformed into the Blogger O’ Love”.

Meanwhile, we are so taken by my brilliant idea to put toons on labels that we asked our buddy, Johnny A., to whip us up a little widget which you can see to the right, which lets you vote on your favorite toon for the next label. We will be adding and deleting labels over time, and the favorites will make their way to a store near you.

Here is the toon I voted for:

SWAG YOUR HEART OUT

We also set up a Stormhoek swag page, (which you can also navigate to from the button on the right) which features “Big Love” hats, g-strings, t-shirts and Boxers, etc Just think how fun Valentines could be after a few bottles of Big Love rose’, you can parade around with your S.O., in your very own Big Love boxers, g-string and hats.. playing the air guitar and singing Achy-Breaky Heart. Whoa… what could be sexier? Certainly a guaranty of lots of hot Stormhoeky action on Valentines!!!

There is tons more happening, but we’ll write about that in the next day or two.

While everyone is busily preparing for the Friday launch of the Love Tour and filming of our first movie, I’m off to the Ad Age Marketing 50 awards luncheon tomorrow in New York, where I’ll be picking up our award as one of the top 50 Marketers of 2006.

The great part of receiving the award is the company that we are in, to mention a few:

Crocs
Gatorade
McDonalds
XBox
Sony Pictures
Zara
and one of our favorite retailers: Trader Joes

I’ll have to watch the Love Tour online as I am off to Cape Town after picking up the award. Harvest is two weeks early and we are aleady crushing pinotage.

I know I deserve a good slap for my tardy posting, but late last year I attended the Wine Web 2.0 tasing in San Francisco, sponsored by Cornelius and Co., at Radcru.

I had the pleasure of meeting a number of producers doing cool things with their wines, although not many really doing much with web 2.0. One exception was Jeff “El Jefe” Stai, the aka “Pimp Daddy” (he’s got more aliases than Crime Solvers), Jeff writes the very good El Blogo Torcido for Twisted Oak Winery.

We chatted about the marajuana crop, spanish grape varieties in Calaveras county and, of course, how to best choke a chicken. Here it is, care of our friends at Youtube:

Been thinking about Bordeaux again…..

We know what it takes to make a case of wine: Grapes, barrels, some labor, a place to make it, bottles, corks, etc. When we’re passing the time driving around wine country, we flip between playing “I Spy” and some number games. It keeps the mind fertile and out of trouble. So, when it was announced a while back that the price of Petrus 2005, en primeur (that means that you have the honor of paying for the stuff two years before you’ll ever see it) was about $35,000 per case, all we could think was: For fucksake, Let’s run the numbers.

So, here are the numbers as we see it: Grapes: the most expensive run about $70.00 a case. Overhead $25.00, Barrels are expensive, so add about $30.00. And nice bottles like the ones they use, run about $8.00 a dozen. Okay, good corks are a bitch to find these days, so I’d say another, $15.00 for the best corks.

Running the abacus over those numbers comes up to about $148 a case of cost. I just don’t know what else to add. I mean, you could add the foie gras, limos, hookers for the good clients, but none of that is really wine cost. So, let’s assume for the moment, that the winery gets about $30,000 of the sales price per case, then their margin is about $29,854.00, per case.

Now, the question is: How many cases do they make? We will never really know for sure, but we do know that there are about 11 hectares and given smallish yields, a safe number is 4,000 cases. So, 4,000* $29,854= $119,416,000.

Based upon that somewhat stupefying number, we can’t help but ask ourselves: What does this mean le petite maison is worth?

Petrus being a ultra luxury brand and truly one-of-a-kind, arguably should command a greater multiple of earnings than say Gucci. Vuitton, etc., while it would be possible to create another Gucci, there ain’t more land being made in Pomerol, so creating another Petrus would be nearly impossible.

However, just to be conservative, after having a look at market caps for luxury goods businesses, we’ll apply a run-of-the-mill multiple of earnings for a super-luxury brands of about 25 times. Therefore, based upon current sales, Petrus, with its 4,000 case business is worth somewhere around a cool $3 Billion. Just to have a good chuckle, take a look to see where they’d be on the FTSE/NYSE large cap list

So, for all of our friends making a few thousand cases of wine out there. Don’t worry that you can’t pay your bills, just keep doing it long enough and maybe your 3,000 cases will be work a cool $3 billion. We can only live in hope.

We were thinking about running the abacus over the Romanee Conti numbers, but maybe we’ll save that for the next long drive.

BTW, we’re going short on 2005 Petrus.

Just before Christmas, I got a phone call from a woman named Natasha, who said she was Channel 4 TV producer, asking me about my views on viral marketing and a flap over a glitch on the Hamley’s site. She was asking whether it was a real glitch or just a PR ploy.

I guess I gave her the answers she was asking for, as a little while later she called to see if she could send me a car to be on the noon news. I hastily replied, “Sure, no problem”, and as I put down the phone, I started to sweat.

Despite the fact that it wasn’t yet 11:00am, two hastily consumed glasses of Pinotage reassured me that I had made the right decision.

The car showed up and I was driven to a TV studio in Kings Cross, where upon my arrival, I was whisked into makeup and before I knew it, I was sitting in front of Samira Ahmed. She started firing questions at me.

As you can imagine, I wasn’t all that interested in talking about Hamley’s; what was on MY mind was the Thresher’s Virus and spelling S-T-O-R-M-H-O-E-K very slowly for all of the viewers (who watches the noon news on a Tuesday anyway?).

You can see for yourself, Samira had her agenda and I had mine, and somewhere for a few seconds, I think they met, but just as I was going to go into a schpiel on the Cluetrain and online communities, the interview was brought to an unceremonious halt.

45 minutes later we were having our office Christmas lunch. Our buddy Joe Wadsack, who is a real TV celeb joined us. He’s promised to guest blog for us. Not a bad turn of events.

Now for the main event:

[Click here to watch. Its not work or family safe.]

Unless you’ve been living under a rock over the last week, you’ve have heard about the fracas over the recently banned, Daniela Cicarelli vid. Some guys have all the luck 😉

The December issue of Wallpaper* had a piece called “Hot Cities”, a visual and numerical rundown of 2006 summer high temperatures, compared to the historical average: (for our American friends, multiply the degrees C by 9/5 and add 32, [ You can do it in your head after a while] 🙂

Stockholm: 32.3C vs. 21.3C
London 34.5C vs. 34.5C
Kiev 31.7C vs. 24.0C
Madrid 40C vs. 31.0C
Berlin 36.6C vs. 23.0C

At this rate, they’ll be planting pinot noir in Stockholm soon.

It reminded me of a post that I wrote in the middle of the sweltering European summer, but sat in drafts:

It’s ironic that what makes Bordeaux so valuable is not that it is so fantastic, but that historically, it is infrequently so fantastic. A couple of times a decade, “the vintage of the century” rolls around and the wine pundits go into their frenzied, frothing at the mouth state of jubilation about how amazing the wines are.

The language and currency of Bordeaux is about scarcity. The wines are released to the market in an archaic way that is designed to maximize the value of each case and allow the brokers to leverage the bad vintages with the good scarce stuff.

We can count the great vintages of the second half of the 20th century on two hands and a couple of toes.

So what happens when, the weather ‘improves’ and instead of two or three great vintages a decade, there are 8?

Well then, its becomes much harder to play the scarcity card.

Good wine becomes the norm, instead of the exception. The Bordeaux model starts to falter. There is more wine than there is demand at high prices and prices for the best stuff drift downward.

‘More and better’ probably isn’t good news for the Bordelaise.

This article brought a tear to our collective eyes- we are humbled by the praise.

Thanks to Kim, Jeanine, Neil, Graham and everyone at www.wine.co.za., You’ve been so supportive of us over the last year and we hope to keep the mojo going in 2007, and give you lots of cool stuff to write about.

08 December 2006 by WineNews Editorial Team

After mulling over the year’s major news stories we are convinced even those whose list-making was more frivolous and less methodical than ours would’ve arrived at the same conclusion. There is only but one true contender for the title.

The WINE.CO.ZA Newsmaker of the Year is Stormhoek, for quite simply being the biggest and most profound news story in South African wine in 2006.

Considering its tally of 18 entries in the WineNews database this year, its 191 000 Google hits, its doubling of sales volume and numerous accolades, it would be highly irresponsible not to name the brand Newsmaker of the Year 2006.

But there’s a bit more to be said yet. To Stormhoek the title of WINE.CO.ZA Newsmaker of the Year for…

…being more than marketing speak. Stormhoek seized 3 of the 17 coveted positions awarded to South African wine in UK wine scribe Matthew Jukes’s cult-status guide, The Wine List. The Stormhoek Rosé, Sauvignon Blanc and Pinot Grigio all feature and – wait for it – all three wines retail at £5.99/bottle. So then, for delivering the goods and not only creating the hype.

For lending impetus to SA wine’s generic efforts around the £5 mark (17% of all South African wine sold in the UK above £5/bottle is from the Stormhoek stable).

For blazing a trail for small guys everywhere, as in not featuring in the big brand realm. For beating colossal contenders the like of Campari and Chivas Regal at The Drinks Business Awards 2006, receiving Best Consumer Campaign of the Year. Thus, for inspiring us in a year that saw SA’s footprint in the UK decline by several percentage points. And for all the while keeping South Africa on the UK wine trade’s radar by the mere virtue of being talked about.

For ‘disrupting’ wine marketing and communication in every possible way.

For making sense. For living the virtual brand business model by being light on bricks and mortar and heavy on sourcing quality fruit from passionate growers across regions; but also for investing locally, in land, and for giving the brand a home here. For partnering marketing savvy – resident and experienced in the target market – with local viticultural and winemaking acumen; not necessarily a novel concept but a seriously sensible one.

For being awarded the Pinotage Trophy at the International Wine & Spirits Competition, outmanoeuvring more illustrious and far more expensive versions. For delivering the goods, again, but especially for doing it with a varietal South African winemakers aren’t always united in their esteem of.

Lastly, for subliminally putting South Africa in hundreds of thousands of people’s collective mind space.

Cheers!

We posted a couple of weeks back about our Best-Pinotage-In-The-World Trophy from the International Wine and Spirits Competition and we raised some issues about competitions generally. There is more competition related news and it deserves a bit of analysis.

BTW- The photo on top is what we are using the Trophy for right now. The Jelly Bellies have proved very popular. We tried the flowers and bath essence route, but we think that the fruitiness of the Jelly Bellies goes with the spirit of the Pinotage 😉

There have been a number of stories over the last several days about NZ winery Wither Hills and their alleged submission of a gold medal winning wine to a local competition, that was different than the wine that they shipped to the market. Yesterday is was reported that they were stripped of their medal and they are facing significant embarrassment.

We are not entirely convinced that this was bait and switch, though it may well have been. Only they really know, but it raises a much more fundamental issue about wine judging and competitions.

Once upon a time, wine was made on a much different scale than it is made today. Wither Hills reportedly made 100,000 cases of the one wine in question. Making 100,000 cases (1.2 million bottles) is a much different exercise than making 1,000 cases. Everything from how the grapes are sourced and grown to how the wine is fermented, aged and most importantly, blended and finished must be done in a way that balances quality and volume.

Anyone with even a slightly inquisitive mind will ask themselves: Is it possible for the first bottle of a 1.2 million bottle production to taste the same as the millionth?

(Ever had a bad cup of coffee at Starbucks, followed by good one?)

The worlds’ most popular premium Chardonnay is Kendall Jackson Proprietor’s Reserve. We believe that they make about 24 million bottles. Are they ALL the same?

Of course, the answer is no. Part of having a meaningful brand is about establishing a ‘house style’. One of the skills that only certain winemakers have, is making large quantities of stylistically consistent wine.

What that means is: making wine so that even if there are variations between bottlings in alcohol, acid, pH, etc., the wines are blended and finished in a way so that they taste consistent, if not identical. It might sound a bit mass production-ish, but in our consumer-driven world, many brands that cultivate the impression of scarcity, are actually made in a large scale. For example, I suspect that there are many millions of bottles of Dom Perignon made in any given vintage they declare. Are THEY all the same?

Even in the good old days, many of the great Chateaux of Bordeaux bottled their wines barrel by barrel. For many reasons that I do not have the space to go into here, there are often large differences between barrels of what should be identical wines. In fact, this is one of the key reasons why spending vast sums on very old bottles of wine is a folly- you just do not know what you will be getting when the cork is pulled. [Which barrel did that bottle of ’45 Latour come from?]

My point is that many of the competitions were created in a time when the wine business was very different than it is today. The scales were different. There were no 100 million-plus bottle brands like Yellow Tail. I think that we all need to rethink the metrics used for rating and judging wines. Perhaps some realignment of how Competitions are run, (or whether they are really a relic of the past ) is in order given the dynamics of the contemporary wine business.

If the New Zealand International Wine Show is stripping Wither Hills of their medal, then they need to deal with all of the issues of all producers they judge, and variation of bottlings in large scale production.

We mentioned in the previous post that we think the trend is for the consensus of consumer opinion to determine a wine’s merits. In just the last week there have been two new websites unveiled that do just this: Bottle Talk and Wine Experience.

Good Luck to both of these sites!

Some folks were asking to see the whole BBC segment, so thanks to the wonders of YouTube and a friendly hack.