Wine on the Plane

Last summer, I worked on a study with Alex Dichter, global head of Travel, Transport, and Logistics at McKinsey. Based in London, he was used to flying across continents on fancy business class seats where passengers are wined and dined. So I was surprised when he said that he never eats on planes. His philosophy is that business class is for sleeping, not eating (more on this here). 

I've since adopted some of his arguments on eating for wine and any alcoholic beverages. If I'm flying, I'm not drinking.

Yes, I understand that traveling can be stressful, especially if we're sitting in tight economy seats. But will alcohol really make it better? My main argument is that alcohol will dehydrate your body and that is not something you need when traveling. Especially in these times of coronavirus, making sure you're 100% healthy should be your priority. Drink at home, at the hotel, or at the restaurant at your destination, but enjoy a cup of tomato, apple or orange juice on the plane. 

Second, I was once curious about the quality of the wines they were serving on my flights, and needless to say, I was quite disappointed even for business class fares. The retail price of bottles on the menu of major Star Alliance carriers for long-haul business class was about $16-20 and in economy, they were between $5-10. Comparing how much money I spend on a trip to the cost of a glass of wine (especially from a health perspective) really convinced me that it is just not worth it to drink when flying. 

So, I urge you, next time you fly, to avoid alcohol and see how much better you feel! 

Powdered wine - sign me up

The results for the investments just came out, and although the powdered wine did not win the largest sums of investment, I think it is a fantastic idea, especially for low-middle end casual restaurants.

I believe that, although it will be first adopted by the outdoorsy folks, people who enjoy a nice glass of wine while hiking without carrying heavy liquids, the potential of powdered wine is in the low-middle end casual restaurants. Just as most soft drinks served at those restaurants come in the form of powder, which is then mixed with water, powdered wine has the potential of becoming the new normal for those restaurants that are mindful of margin and cost.

Having worked on a final project attempting to cut distribution cost by replacing glass with silicone, I'm amazed at how much more shipping weight powdered wine can cut. Even though glass represents 40% of the weight of an average bottle of wine, it still means that the liquid accounts for the remaining 60%. As such, if powder can replace 100% of the bottle with 10% of its weight, the shipping costs would be relatively negligible. Moreover, the volume would also be reduced manyfold, again reducing costs.

But what about taste? What about flavors? What about branding? These are the tricky questions. I'm assuming that technology will do its wonders and create, at least for the cheaper wines, equivalents in powder form. Powdered soft drinks is an indication that consumers may not care about the original form, so long as the end product tastes the same. From a branding perspective, the powder will have to be played down to the point where no one cares about that aspect anymore. One way to do so would be to have a "wine tap" where restaurant patrons can have a free glass of wine. Once they realize that there is not much difference, and that the price is much lower, chances that they fuss about the powder will be quite low.

Powdered wine has so much potential, it is just waiting for the audacious restaurateurs to try it out.

Madeira: A Favorite of the Founding Fathers

For the past couple of years, I’ve gone to the Feast of the Blessed Sacrament in New Bedford, MA. Also known as Madeira Feast, it’s the largest Portuguese feast in the world [1]. It doesn’t take long after arriving that you’re confronted with a tiny, pungent cup of madeira. (Thankfully, there are also ample food opportunities available, including a cook your own meat on a skewer barbecue pit [2]). Supposedly, this event has the highest consumption of madeira outside of Portugal!

For those that are less familiar, Madeira is a fortified wine, in addition to being an autonomous region of Portugal. It’s strong, a little spicy, and sweet. Due to the quirks of geography and trade, madeira has enjoyed worldwide popularity -- much more than what you would expect for a specialty wine from a small island off the coast of Morocco. Historically, ships would stop at Madeira (the island) as the final stop before their transatlantic voyages, which were exempt from Britain’s Navigation Act (which limited what wines and spirits could be brought to the colonies) [3]. Almost like an eighteenth century Duty Free, ships would stock up on alcohol, primarily madeira. Apparently the lessons of Inniskillin and how Duty Free can increase the popularity (and margins!) on alcoholic beverages stems from a little earlier than the 1960s. This is also the reason that madeira is celebrated in New Bedford, MA, since it was a former Atlantic whaling hub.

Initially, madeira was the “luxury” alcohol available in the US, beyond the beer and rum. Wines from France and Italy were not imported because of the challenges of the journey, which made madeira the best choice available given it is very stable, not temperature sensitive, and benefitted from extended aging. It was apparently the favorite wine of the founding fathers! [3].
However, madeira suffered from some of the challenges we’ve seen other wineries and varietals face -- like changing consumer preferences (reduced share of throat) and increased regulation (Prohibition).

There are some folks arguing that it should have a greater place on the table in modern times, including the New York Times [4]. I don’t know if a hot summer day was the best place to drink it, but I could see it having an excellent place when paired with richer holiday foods or during a crisp fall or winter day. I’d encourage you to try it and toast to the founding fathers!

[1] https://www.newbedfordguide.com/2019-feast-survival-guide/2019/07/23 
[2] http://destinationnewbedford.org/event/feast-of-the-blessed-sacrament/
[3] https://www.thedailybeast.com/americas-love-affair-with-madeira-wine
[4] https://www.nytimes.com/2017/01/30/dining/wine-school-madeira.html

Hard Kombucha, thoughts on a trend pioneered by Hard Seltzer

The recent hard seltzer boom has given hope that other "hard" beverages may also take off very soon. One of my favorite drinks is kombucha, and I recently tried some hard kombucha. Why? I was at a housewarming party (in the Bay Area), and the host had prepared a selection of drinks that included beers, White Claws, hard kombuchas, and EANABs. My kombucha was tasty and I could barely distinguish the alcohol, which led me to reflect on the drivers of my choice of beverage. Did I choose the hard kombucha because I simply favor the taste of kombucha or because it is "healthier" than the other options (or maybe I believed that it was healthier)? The more insightful question, rather, is would I have preferred a regular kombucha?

Asking this question reveals that succeeding in this alternative alcohol market is not so easy. Hard seltzer had the advantage of being almost completely new (no one I know who likes White Claw used to just drink seltzer), whereas hard kombucha, hard tea, and even hard water have a clear "regular" version that we all enjoy. The value-add of alcohol that is barely distinguishable seems much lower. It is also important to note that those regular drinks are known for their health benefits and there is not yet a clear answer as to whether an alcoholic version would maintain the health benefits.

Therefore, my personal outlook for hard kombucha is mixed. Despite its initial success, I believe it will have a difficult time finding hard seltzer-like growth on its own, but can potentially be packaged in forms such as kombucha cocktails and play in the field of pre-made, single-serve cocktails.


Sources:
https://www.theiwsr.com/news-and-comment-radius-trend-hard-kombucha/
https://miruspromotions.com/industry-trends-hard-kombucha/
https://www.marketwatch.com/press-release/hard-kombucha-market-2020-2026-pointing-to-capture-largest-market-growth-and-share-with-developed-economies---industry-research-co-2020-01-24

Top Insights from the Quarter

We learned with remarkable depth across such a breadth of topics, strategies, and perspectives, I wanted to focus in on a few that really stood out to me via raw impact and surprise:

| Law

The first is the defining function of law. If f(x,y,z...) is the function governing a businesses' operations, one of those variables better be a nuanced understanding of the 21st amendment. This law sketches the contours of the wine industry, with every U.S. wine operator providing the color between those lines. Its passage destroyed the potential for businesses and gave others' powerful competitive advantage. How do we not have Amazon Wine? Can you even think of investing in a wine provider without core licensing in the bag? If you don't understand this, the instruments of your perspective on the wine industry are out of tune -- you're simply unprepared to answer many of the industry's most poignant questions.

| Math

Supply outstrips demand. From immediately getting cold-called in the first class to our very last day together, the charm of this fact is imbued in its counter-intuitiveness. How many industries can claim this? But the more we dug in, the more this simple fact tessellated the picture of the global wine economy. Some classes, I sat there thinking, "Well of course supply outpaces demand--so many winemakers and sellers vying for real palette estate." Others I'd think, "How come everybody doesn't want this? There are 84 million wine drinkers in the U.S. alone, plenty of colleges--at least the buck-chuck segment should be filled..." This is one of those questions that I feel leads to healthy reflection and progressively deeper understanding of the industry if one keeps asking it of him/herself over time.

| Art

My favorite class was hearing from our guest sommelier (note: "Blogger" doesn't recognize 'sommelier' - sad!). For whatever reason, the human mind seems unable to look at an expert and recognize the fact that talent isn't innate; it's brute force, studying, getting things wrong, and building a skill. It was great to peak behind the curtain to hear how his conceptual backbone and experience informs his ability to truly taste and appreciate different wines (and countries, regions and cultures in turn). His matrix "tastes-like" slides I'll never forget, and it honestly made me leave wanting to start yet another side hustle to delve into a subtle part of the world -- purely for the journey of it.

| Learning

One of the most important elements of this class that I've already articulated to some is the pace. This class moved. We didn't waste time, and if you didn't show up, you'd feel completely out of place (let alone look stupid).

That comes from a mutual trust from teaching and students to buy all the way in, but it also comes through execution. There was an expectation that everyone not only had "done the reading", but had informed takes on it, had found the logical gaps, explored alternatives and was looking to share their value-add.

To make this environment a reality in one's own life, take expectations and situate them within a given class/workplace as premises, have a vision for what's important, and reward contribution. This course created genuine intellectual excitement, and I love being reminded of what that looks like.

The Declining Trend of Bordeaux Wine

I am sure everyone knows Bordeaux as the famous wine production region. Indeed, they have over 60 appellations, 6,000 chateaux, and 120,000 hectares of vineyards all together. However, the reason I am writing about this is because I heard on BBC Global News today that they are not doing very well these days. According to Bordeaux Wine Board or the CIVB, domestic sales of their wine has dropped 10% last year, which accounts for 54% world wide or 130 million bottles.
According to multiple sources, this is due to the drinking trend. First of all, French people are not drinking a bottle per day (which French men used to a few decades ago); they are drinking much less. Also, the drinking culture amongst the younger generations (millennials) has changed drastically. Instead of wine, they tend to go to other alcoholic beverages. Finally, craft beer is a huge alternative to the wines, and Bordeaux craft beers are actually on the boom. There are many popular breweries in the region, attracting domestic and international customers—a market disruptor for the wineries. Despite the trend, critics say that Bordeaux will remain a dominant wine region offering quality wines to customers.

https://www.telegraph.co.uk/news/2020/03/11/bordeaux-bows-french-thirst-craft-beer-amid-record-drop-domestic/
https://www.telegraph.co.uk/news/2019/08/20/bordeaux-winemakers-forced-promote-rose-white-wines-young-drinkers/
https://www.thewinecellarinsider.com/wine-topics/bordeaux-wine-production-facts-figures-grapes-vineyards/

Going Public...In Canada?

I was fascinated by Wendy Berger's presentation last week during our final class. In particular, I was intrigued by the recent trend of US companies going public via a "reverse merger" in Canada, even though many of these firms don't operate in the country at all.

I decided to dive into the topic in more detail and create an FAQ:

What is an RTO?
A reverse takeover (RTO) is a 'backdoor' method of becoming a publicly listed company. A publicly listed shell company acquires all shares of a private operating company. The shareholders of the private company then exchange their shares for the public one.

Why go public via an RTO?
There are multiple benefits, including:

• RTOs minimize the execution risk of an IPO because the value is pre-determined and voted on by shareholders
• Lower cost (may not need to pay an underwriter)
• Typically faster than an IPO
• Lower regulatory review requirements / public scrutiny 

What US cannabis firms have recently gone public in Canada?

• Green Thumb Industries (Cannabis CPG) 
• Wikileaf (Seattle-based online cannabis directory)
• POSaBIT (maker of hardware for cannabis companies to process payments)
• MedMen (LA based retailer)
• Haborside (California-based retailer)

Why Canada?

Canada legalized marijuana on the federal level in 2018. As a result, Canadian banks are able to provide capital and there is little legal risk for companies based there.

What exchanges do they trade on?

Most cannabis companies are traded on one of three exchanges: TSX, CSE or TSXV. All cannabis companies with US operations trade on the CSE:

• CSE (Canadian Securities Exchange) - most common exchange for cannabis companies; has lower listing and reporting requirements than TSX and TSXV and will allow cannabis companies with US operations
• TSX (Toronto Stock Exchange) - Major exchange with strict listing rules, similar to the NYSE; will not allow cannabis companies that operate in a country where cannabis is illegal.
• TSXV (TSX Venture Exchange) - serves as a public venture marketplace for small cap companies (like the Nasdaq Capital Market or OTC markets in the US). Currently lists 40 cannabis companies, including Delta9

Sources:
http://magazine.cannabisdispensarymag.com/article/august-2019/cannabis-dispensary-going-public-ipo-options.aspx
https://www.geekwire.com/2019/seattle-cannabis-company-wikileaf-set-go-public-canada/
https://www.dwpv.com/en/Insights/Publications/2019/Return-of-Reverse-Takeover

The Urbane Practice of Urban Wine

Working on the final project for this class was a very interesting experiment in ideating and frameworking potential wine business plans. Our final project, Liquidity - The Premier Wine Cellar Marketplace, I believe legitimately has a lot of potential and I can say I learned a great deal just from this exercise in the logistics and regulatory aspect of how this would work. But there were a great deal of other interesting ideas our group considered that also had a lot of potential. One in particular that I thought was interesting was the concept of a chain of high end urban wineries.

Urban wineries are not as new an innovation as may be guessed. Pre-prohibition, making wine outside of concentrated vineyard regions like Napa or Sonoma and in warehouses concentrated near major cities was quite common. [1] Then came prohibition (and the shuttering of many of these operations) and the rise of winemaking as a cultural destination. No longer was wine a commodity to be made in the vein of Coca-Cola, with regional bottling centers. From the 1960s onward, wine production in America was more akin to visiting the U.S. Mint. That is, at least, until the early 2000s when urban wineries became to make a comeback.

Urban wineries are both a meeting place and cultural touch point, with value propositions surrounding accessibility as much as wine quality. [2] That being said, wines across the country are showing they can be made in an urban environment without sacrificing on quality. Urban wineries also have the advantage of providing small operations complete control of their process, a very attractive feature for winemakers who make natural wines. Traditional wine-making hubs like Oregon and northern California are understandably producing terrific wines, but also getting into the mix are nontraditional places like Denver, Austin, and Brooklyn. [3] Some, like Infinite Monkey Theorem and City Winery, are even opening up multiple locations across different cities, showing that a single organization can grow and thrive beyond a single market. It's still early days for urban wineries at scale and whether growth to the mass market can extend beyond "hip" cities like Austin, Portland, and Nashville is still in question. But growth in trending positively so it is likely we'll see urban wineries for years to come.

Sources:
[1] https://www.eater.com/2011/3/1/6694779/americas-urban-winery-revival-what-does-it-mean
[2] https://www.foodandwine.com/wine/what-are-urban-wineries
[3] https://www.foodandwine.com/wine/10-best-urban-wineries-in-country

Wine in the Time of Corona

It was inevitable: non-essential areas of gathering, including bars, restaurants, and coffee shops would all start shutting down. So where will I get my wine? 

For this blog post, I decided to make a compilation of my research on drinking while staying in. 

1) Grocery-as-usual: This is still an option. Although specialty stores like K&L might close, grocery stores will likely be open and their wine shelves are probably the fullest right now. Where? Your favorite local grocery store. 

2) Bottles you love delivered: If you're self-quarantining / isolating, and know what you want to drink, getting your bottles delivered directly to your home seems like a great option. Here, there are a few options:

1. Alcohol retailer: Wine.com, Totalwine.com, Bevmo's website, etc.
2. Third-party delivery services: Postmates, Instacart, Grubhub, etc.
3. Wine club: If you know you enjoy a winery's wines, maybe now is a good time to join their wine club.
4. Winc.com: They will make a selection for you after asking you a few questions about your preferences for coffee and other flavors. A little more adventurous, but you'll still see which bottles they send you before you order.

3) A whole case delivered: If you plan to drink a lot, cheaply, and don't mind which wines, WSJ's wine club has a great deal  where you can buy a case (+2 bonus bottles) for just $69.99. You won't get to choose which wines you'll get, beyond red or white, but it's definitely a great deal for the price. 

4) By the glass wine delivered: If you're like me and self-isolating alone, bottles of wine may not make perfect sense, but by the glass wines do.

1. Vinebox: This is perhaps the most exciting as you get 9 glasses of different wines in a box. The only negative is that the price is pretty steep, but maybe @Olga has a special discount for her classmates?
2. Maker Wine: For those who enjoyed the Maker Wines we had in class and want to order two bottles worth without having to drink a bottle at once, joining the can club may be right for you. I would still recommend drinking them from a glass so the olfactory senses are not lost. 

5) Maybe try drinking other beverages? Besides wine, there are plenty of beverages that are tasty and easy to make at home. Here are just three of my favorite:

1. Pour over coffee: Enjoy a nice brew without spending thousands of dollars on an espresso machine. I enjoy making pour overs because there are so many factors at play, the beans, the ground, the ratio of coffee to water, the temperature of the water, the pour itself, etc. Blue Bottle has a special introductory program where you get 6 coffee bags delivered to you over 3 months and it includes a pour over kit. Use this code for an extra $10 off!  
2. Tea: Enjoy a nice cup of tea with your reading during the day. In times like this, I'm a big fan of turmeric tea. There are plenty of recipes online, but don't forget to add some black pepper to the mix. 

I hope this is helpful to you! 

Santé :) 

Wine and Climate Change

As climate change continues to have a significant impact on many aspects of everyday life, I wanted to explore the idea that major wine regions will shift as traditional wine-growing regions become too warm and regions that were once too cold become well-suited for the craft. We discussed this idea briefly as part of the DBR case, but I was curious how significant the changes might be.

Over the past 100 years, the average global temperature has increased by 1.4 degrees and is predicted to continue rising 2-11.5 degrees by the end of the century.

Based on some research, below are a few regions that will benefit and a couple that will need to adapt:

On the rise:

• England: The country is producing some exceptional sparkling wines, especially along the southern coast of the country. The soil in these regions is very similar to that in Champagne: chalky and white
• Burgundy, Champagne, and Mosel: Warmer growing seasons make it easier to produce wines more consistently
• Norway and Sweden: As temperatures rise, we will see more wine coming from the region, both hybrid varietals that are made for colder temperatures and more traditional European varietals, such as Riesling
• Catalonia Region of Spain: The mountainous regions of Catalonia historically did not have enough intense periods of heat to support vineyards. That is changing with the diurnal shift (the temperature swing over a day). New vineyards 3-4k feet above sea-level are being planted

On the fall

• Yarra Valley, Australia: Grapes in the region were traditionally planted on the northern side of hills to ensure they received the most sunlight possible (and accelerate ripening). With climate change, growers are planting more and more grapes facing south whether the temperature is coolest to prevent over-ripening. We're starting to see the same thing in Napa and other regions (in the northern hemisphere, the southern side is the warmest and northern side the coolest)
• Bordeaux: The region recently added seven grape varietals as approved by the appellation authorities as a response to climate change, including touriga naciaonal (traditionally used for port), marselan, castets, and arinarnoa (cross between cab and tannat that is late ripening)

Sources:
https://www.nytimes.com/interactive/2019/10/14/dining/drinks/climate-change-wine.html
https://science.howstuffworks.com/environmental/green-science/global-warming-wine-industry1.htm

A Brief History of Oak Barrels

A number of times throughout this class, I noticed how often wooden barrels were mentioned as an important element to wine production. Sometimes this was a positive element that complemented the wine we were tasting and other times it was negative, either because the wine were tasting had too much oak in it or simply because the cost of oak barrels themselves made some wine operations prohibitively expensive. This got me very interested in the practice of oak barrels, when they first began to be used, and what they contribute.

Historically, wine was typically aged in clay vases rather than wood barrels. The exception here was Mesopotamia where palm wood barrels were used rather than the Egyptian and Roman practice of clay. [1] This practice was continued until the Romans conquered the people of Gaul (modern day France), who had been using oak barrels to transport beer. In contrast to palm wood, oak was widely available in Europe, waterproof because of it's tight grain, and malleable enough to require less effort to be made into a barrel.

Today, oak is widely broken into French oak (the same type as used originally by the people of Gaul) and American oak, which have respective advantages. Broadly the difference breaks down as follows:

Generally speaking, American oak is ideal for bolder, more structured wines (Cabernet Sauvignon, Petite Sirah) that can handle American oak’s robust flavors and oxygen ingress, whereas European oak is ideal for lighter wines (such as Pinot Noir or Chardonnay) that require more subtlety. [2]

In an industry as complex and storied as wine, it's gratifying to realize both the practical and aesthetic advantages of using oak. Oak was a demonstrably better medium to transport wine than clay and had the added effect of imbuing subtleties into the wine that had not previously been there. When American oak was introduced, the wine industry changed again and incorporated that wood into the production of wines that could benefit from a bolder effect. Ultimately, while it can be tempting to attribute the way old industries operate to inertia or tradition, even a quick study into why oak is used in wine show another story.

Sources:
[1] https://vinepair.com/wine-101/wine-aged-oak-history-lesson/
[2] https://winefolly.com/tips/how-wine-barrels-affect-the-taste-of-wine/

Why I took this class (Long overdue post!)

For starters, what can be a better way to end my three years in Stanford than with a class like this!!??? I get to learn about wine AND drink wine in class!!! Win-Win

Before I came to California, I was primarily a whisky drinker with occasional cocktail experiments. Make no mistake, I am still a huge fan of a good scotch and now also the Japanese blends. I had tried wine a few times in India, but no memorable tastes lingered.

I was initially incredibly disappointed at a complete lack of interest in whisky (this changed later when I found my gang of whisky lovers, but that’s a story for another day). Everybody here loved wine!! Like seriously!!???

Well, if you can’t beat them, join them, and join them I did and how! Wine country truly lived up to its hype, I love the variety I have tried in last three years, right from cheap $3 bottle to expensive $700 bottle. I have been partying drunk on some amazing wine, thrown up some real shitty wine, done networking holding a glass of wine (and trying to look classy, not sure I managed that part) and so much more.

The whole idea to be a part of this was two-way (besides a sort of graduation gift to self),

-       My MSx 2018 cohort members who took this class (Ajay Serohi & Andy Tan) praised it so much that my curiosity was piqued, and I had to be a part of this experience myself.

-       Every wine tasting event I attended described wine making/tasting as a beautiful art and an interesting business to be in. I wanted to know more about this.

I admit I have not been disappointed at all. I loved my time in this class. I tasted some amazing wines. I actually held a great conversation, last weekend, with someone who I consider is very knowledgeable about wine industry and managed to make a good contribution to the discussion!! That’s a huge win for me.

Thank you, Alyssa. This was an amazing journey.

Trader Joe's? How about Trader No's!

The world on the brink of imminent collapse, at least if you're judging from the ability to buy dry goods in Palo Alto. As the fear of coronavirus grows, so does the demand for non-perishable goods to shore up the self-isolation efforts occurring across the country. The thinking here seemingly goes that if we're going to have be quarantined for the next couple weeks, we better not run out of toilet paper and spaghetti. I personally witnessed this while trying to buy groceries at Whole Foods and Trader Joe's the past weekend.

It also appears that the fear of quarantine is also driving an increase in demand for alcohol. While no one necessarily wants a global pandemic, it could have the admitted benefit of shoring up the declining wine sales the industry with some cities seeing increases in retail alcohol sales by as much as 500% compared to January. [1] While all alcohol sales are up, anecdotal evidence suggests cheap wine is a top seller. A possible (but not verified) reason for this is as a side effect of being quarantined for weeks on end with children, spouses, and potentially (gasp!) in-laws.

However, it remains to be seen if growth in retail wine sales helps or hurts the overall industry as the decline in business at wine bars and restaurants may offset this. As the virus spread grows, more regions are taking a "shelter-in-place" approach, limiting the amount of people that can be congregated at once or mandating the restriction of establishments like restaurants to take-out only. [2] So maybe have a second (or third) glass with your take out. It's going to be a long winter after all.

Sources:
[1] https://www.nytimes.com/2020/03/13/us/coronavirus-alcohol-sales.html
[2] https://www.sfchronicle.com/bayarea/article/Bay-Area-to-shelter-in-place-What-you-need-15135087.php
[2] Photos I took at Whole Foods and Trader Joe's, respectively.

Supertasters

Before taking this class, I would often get frustrated when attending wine tastings. I rarely could taste the subtle, nuanced flavors that I was told were in the wine. "Barnyard"? "Dried Oak"? "Fresh cut garden hose"? "Wet Band-aid"?! I couldn't believe that your everyday person could detect these flavors. I assumed you needed to have super-tasting abilities or some other sort of physiological gift.

When Alder Yarrow attended class, I was shocked when he shared that over 80% percent of the population had the "same equipment", and that the process of learning to identify subtleties in wine was much like that of a baseball fan memorizing statistics. All it takes is dedicated practice and repetition.

I liked his answer, but to be honest I doubted it. So I did some research. I found a fascinating Slate article from 2017 that explored the question. A few key learnings:

• Wine critics often claim they are "supertasters" to bolster their brand ("What wine writer would want to own up to having a genetically inferior palate"?)
• Real super-tasters have it tough and their ability could actually be a liability
• They enjoy the flavor of alcohol less than normal tasters because it leaves an unpleasant burning sensation in their mouth
• They are extra sensitive to astringency and acidity, making it harder for them to enjoy wine
• Super-tasters will likely prefer wines that appeal to other super-tasters more than the general population (the majority of wine aficionados) 

Now I feel better about my status as a normal taster. Furthermore, I've noticed that after 9 sessions my appreciation for wine has definitely improved. I won't always get the subtle aromas correct, but I'm starting to detect their presence and am excited to continue to hone my abilities.

Cannabis Meets COVID 19

I really enjoyed the session regarding cannabis and the relations is plays with the challenges being faced in the wine industry.

One key insight that stuck with me is the point that Wendy made regarding how the COVID-19 virus may in fact lead to higher sales for cannabis than before. The difference, she mentioned, was that people, who stressed and under some sort of isolation, may feel the need to find external ways to relax, which cannabis does a great job at. Wendy also mentioned that smokeable flower is the highest earning and highest volume of cannabis product sales they see.

Now, while I think she may be right that consumption of cannabis may increase, I think the form factor may change significantly. This is because thus far, albeit data is limited, smokers have a higher chance of getting seriously ill from COVID (one of many sources here). While this is generally not a key part of the zeitgeist surrounding this pandemic now, if the spread of this virus ends up being a higher scenario, one could imagine strong PSA's pushing against smoking. This is not inconceivable given all the other drastic measures governments and public health officials are making, let alone how the media is reporting them.

While I hope we do not end up in that situation, I will be very curious to see how this industry moves through such time and how the form factors preferred by customers change.

A Well-Traveled Wine

A couple of weeks ago, I was fortunate to join the Wine Circle on a trek to wine country. (Hannah [1] and Janine [2] also wrote about their experiences!) One of the things that I noticed in the cellar of the French Laundry was that a number of very nice bottles of wine appeared to have an odd sticker on them that said “A Well Traveled Wine.”

The mysterious sticker:

Before I could even ask, the sommelier who was giving us a tour mentioned that there had been a cellar break-in several years ago and the labeled wines had been stolen and then recovered. A wine heist? I had to know more.

It turned out that in 2014, a group had broken into the French Laundry while it was being remodelled and stole 110 bottles of wine worth more than $870,000 [3]. (For those keeping score at home, that’s almost $8000 a bottle). It seemed that the thieves knew what they were looking for -- they cherry picked several premier wines:

• Domaine de la Romanée-Conti: the famed Burgundy producer
• Screaming Eagle: the cult Oakville favorite
• Dom Perignon: the prestigious champagne 
• Jacques-Frédéric Mugnier: another famed Burgundy Grand Cru

The majority of the bottles turned up on the other side of the country a couple months later when someone purchased several cases of rare wine from a broker they had previously worked with, but with the publicity surrounding the break-in at the French Laundry, came to suspect might be stolen [4]. The authorities were able to confirm that this was the stolen wine because the French Laundry had previously noted the serial numbers on the bottles.

More importantly, the thieves were apprehended. They also admitted a wine theft at a steakhouse (where they went for rare Bordeauxs) and a wine store in San Francisco [5]. With time, the wine made its way back across the country and into the newly renovated cellar -- now with the mysterious labels I noticed attached!

[1] https://rappwinter2020.blogspot.com/2020/02/what-does-3-star-michelin-restaurant.html
[2] https://rappwinter2020.blogspot.com/2020/02/super-super-super-premium-wines-how.html
[3] https://www.thedrinksbusiness.com/2018/01/second-thief-jailed-over-800k-french-laundry-wine-heist/
[4] https://www.atlasobscura.com/articles/french-laundry-wine-stolen
[5] https://www.sfgate.com/crime/article/Modesto-man-gets15-month-prison-term-in-2014-11034771.php 

Declining Interest in Bordeaux?

Throughout the course, we’ve discussed changing consumption preferences as both share of throat and share of buzz, as well as the rise of Bordeaux as a premier wine region. While I expected those trends to continue outside of the US, I was very surprised to see the headline that French domestic consumption of Bordeaux has declined to the lowest point in the past two decades.

The Bordeaux wine industry primarily attributed the domestic decline in Bordeaux consumption with an increasing consumption of craft beer. That said, digging into an internal study, they claimed that out of 100 unsold bottles of Bordeaux:

• 64 were due to a reduction in alcohol consumption (a smaller throat/buzz)
• 32 were due to customers choosing another form of alcohol, primarily beer (share of throat)
• 4 due to customers choosing wines from other regions 

The overall reduction in wine consumption makes sense as health and wellness trends grow. Similarly to what we saw in the US, France’s younger consumers have different drinking preferences than the older generations. Young French consumers are moving towards chilled wines and rosé as well as beer.

And what about Bordeaux? The wine board of Bordeaux is increasingly concerned. 54% of Bordeaux is consumed domestically, the rest is exported. China accounts for approximately 25% of all Bordeaux wine sales and is seeing a decline in sales. Combined with US tariffs and the subsequent decline in demand, the wine board is justified in their concern.

Source: https://www.telegraph.co.uk/news/2020/03/11/bordeaux-bows-french-thirst-craft-beer-amid-record-drop-domestic/

The Ides of March and Ancient Roman Wine

Today is the Ides of March, originally the mark of the Roman New Year but more widely known as the day that Julius Caesar was assassinated back in 44 BC. As such, I thought I'd do some research on ancient Roman wine making and consumption.

Unsurprisingly, wine was of great importance to the Romans, and many people across all classes would drink it. However, the wine of the ancient Romans was very different than what we consume today. The process to harvest and ferment the grapes was quite similar to what's presently done: grapes are pressed after harvest, crushed by foot, and fermented in large terracotta containers in the ground with holes on the top that allowed CO2 to escape. The resulting wine from this process was quite unpalatable, so Romans would make a number of adjustments. For example, marble dust would be used to reduce acidity, wine was boiled or honey or lead (??) were added to sweeten the wine, some people added their selection of spices to the wine to flavor it and give it medicinal qualities, and others diluted the wine with water (the "drinking water" was not potable, so the alcohol killed off the bacteria).

Consumption was high -- on average, one bottle was consumed per person per day! Some of the more coveted wines came from the regions of modern day Campania and Lazio in Italy, which are now not as well known for their wines as a place like Tuscany (whose wines in Ancient Rome were not considered high quality). Prior to the Mount Vesuvius eruption, Pompeii was also quite famous in the Roman Empire for its wine. Its vineyards were devastated by the eruption, but are now being revived thanks to the documentation (which grapes were planted and how) of author and naturalist Pliny the Elder back in the first century AD.

If you happen to be in Southern France or Italy in the (not near) future, it seems there are a couple of wineries that can evoke the flavors of wine from the ancient Roman Empire. Mas de Tourelles in France uses the techniques described above that winemakers used to use. In Campania, you can try wine made from the red anglianico, finao, or greco grapes, or the sweet Falanghina wine. Lazio wines include Terbbiano and Malvasia di Candia.

As the Romans said back in the day: "Dignitas Amicorum Pie Zeses Vivas!" (Worthy among your friends! Drink that you may live. May you live!)

https://finewineconcierge.com/the-ides-of-march
https://www.cbc.ca/natureofthings/features/what-does-a-two-thousand-year-old-wine-taste-like
http://tourelles.com/
https://www.forbes.com/sites/drsarahbond/2016/12/31/drink-and-live-among-the-good-ancient-toasts-to-welcome-the-new-year/#7bfe66c563d3

English Sparkling Wine Is Making an Impact in the US

English Sparkling Wine Is Making an Impact in the US

English sparkling wine is relatively new to most consumers. Since the 1990's the category has seen its consumption and reputation rise. Mostly due to producers like Ridgeview Winery in East Sussex, which began planting vines in 1995, and whose Grosvenor Blanc de Blancs won Best Sparkling Wine in the World from Decanter in 2010. 

In recent years U.S. importers and distributors making the category more available to U.S. consumers. Critics and consumers agree that bottles from the region rival those from Champagne in taste, quality, and price.

English Sparkling can place lots of its recent success to a combination of good soil and bad economics. Due to the pound weakening, English producers are selling their wines to foreign buyers at a cheaper rate, with the U.S. being the biggest export market.

So which 4 UK Sparkling wines should you try: 

- Gusbourne Estate Brut Reserve. Average price: $49.
- Hattingley Valley Blanc de Blancs. Average price: $69.
- Hush Heath Estate Balfour 1503 Classic Cuvée. Average price: $39.
- Wiston Estate Rosé. Average price: $40.

"Yes, That's Wine!"

Last night I was re watching one of my favourite British comedians - Michael McIntyre sketch on the bizarre ritual of ordering wine in a restaurant. Prior to this class I feel that I took a role in the overall game that is the wine ordering process when no one understands what they are doing. Then ultimately - someone tastes it and says the very solid "Yes" - when often they did not know what they were tasting for. As part of this course I have developed me knowledge around wine tasting so wanted to summarise some of the basics of what I have learned: 

Hold the glass: Always use the stem so you don't warm the wine with your hand.

Take a look in your glass: Hold up a glass to light, and note the colour. Is it dark, rich, hard to see through? Or is it like coloured glass, easy to see through?

Give it a smell: Your nose does a lot of the hard work in identifying flavors. Do you smell a fruit? Now give it a swirl. Make sure your nose is close enough that you can pick up important notes (notes is wine-speak for aromas or flavors).

Take a sip: Try sipping a bit of wine with air in your mouth so you can aerate the wine itself. Swirl it around your mouth for a moment, so the different parts of the tongue. After a few seconds of pondering time, you can swallow. 

To help with tasting I found it useful to learn more about the aspects of a wine. 

Body: Alcohol gives wine weight. If a wine feels heavy, it often has a higher alcohol content. 

Fruit: This is where the wine falls on the scale between fruity and savory. 

Acid: If the wine has medium to high acid, it can make your mouth water, often described as "juicy." Too much acid can feel like sucking on a lemon.

Tannin, astringency or texture: Found primarily in reds, tannin comes from the skin, seeds and stems of grapes. In the mouth, tannin might feel like sucking on a napkin, as if the moisture has left your mouth. 

These short notes have helped me develop my thinking around wine tasting - now I hope to further develop these over time. 

Cooking with Wine

As someone who is more skilled at eating food than cooking it - I often default to my role as the "provider" of wine. Last week when cooking with my housemate he asked if he could have the bottle of wine I had in my hand (a bottle of Decoy Pinot Noir). He then proceeded to pour a cup of red wine into the beef stew he was making. This made me think - where does the idea for cooking with wine come from? And how do you do it properly? 

After a little research I came across something from “What’s Cooking America” - that explained the  function of wine in cooking is to intensify, enhance, and accent the flavor and aroma of food – not to make the flavor of what you are cooking, but rather fortify it. In line with any type of seasoning in cooking, balance should be observed while adding it in – a small quantity of wine should enhance the flavor of the dish. 

The question I often had on my mind was - what happens to the alcohol? In cooking, the alcohol in the wine is evaporated, and what is left is the flavor of the wine. Boiling down the wine concentrates the flavor, and intensifies either the acidity or the sweetness. To optimize the flavor, wine should be added while allowing a sufficient amount of time to cook. 

So as I continue on my wine learning journey - I will continue to explore what wine to drink, what to eat with it, and now - what to cook with it. 

A Final Presentation on Wine Tasting

I came into this class with a general appreciation for wine, but with very very little knowledge about it. Being present in the class and learning from all of you, I can now with confidence explain the major differences between types of wines, what "oaky" means, and why you hold a glass by the stem. To challenge myself to go from novice to expert, I did my final Public Speaking (ENGR 103) presentation on how to taste wine! I was quite surprised at the amount I learned about the process, even though that was not the main focus (only the treat at the end). Below is my script, a couple supplementary photos, and the questions I received from the audience. 

Script

Bee keeper Ibrahim had a problem… his honey kept being eaten by bears at night. This was annoying and he tried to find ways to prevent it. One night, he had an idea that the bear-intruder would actually serve a purpose: as a honey taster. He laid out 5 different honeys and waited in the night. 

The bear took the biggest liking for the royal Anzer Bali— by far the most expensive and rare one. The bear also gobbled up the other honeys, but he also stayed away from the grocery store varietal. 

Today, I will teach you that you are exactly like this bear. You don’t have to know anything about pricing or prestige, but you know a good snack from a bad one. We will apply the idea of tasting to an often mystified product: wine. I will teach you how to approach the art of wine tasting, so that even if you don’t know anything, you can still make some distinctions. First, you will evaluate the wine by seeing its color and droplets, then smelling it for identifying major aromas, and finally, the good part, tasting. 

I’ll be demonstrating the process with this Sonoma Cab.

1. Alright, we have this wine in front of you. What do you do first? The first step to the wine is Seeing it

Place against a white background: more intense means more flavorful 

Sav Blanc vs. Chardonnay
Evaluating droplets: swish the wine around and see how quickly droplets fall

Just by looking at wine you can see alcohol level

Viscous, taking longer to go down- then sweeter + more alcohol

Seems like we’ve seen enough. What do we do after?

2. Well, after seeing the wine we begin to smell it. 

80% of the experience is olfactory 

Try to find 3 fruits, 3 other flavors

Red wines: red fruits and berries

White wines: citrus and other light fruits like apple and pear

Other flavors: vanilla, flowers, oak, earth, minerality

HUGE range of different smells, the most helpful thing for me was having a wine aroma wheel in front of me. Takes time to learn how to do this since humans don't do it intuitively. 

Okay, now we’ve identified those aromas in the wine, it’s time to wrap it up. We have now officially earned our right to taste the wine. 

3. Tasting: Swish it around your mouth

Breath in to mouth, out through nose 

Retronasal olfaction

Dry vs. sweet?

Bold vs. Light

Acidic vs. soft

Smooth vs. tannic (sandpaper feeling)

Remember, it takes time. You don’t wake up an expert in something, but there is a basic intuition behind it. The best method of learning how to taste wine is get some really good examples. 

What you can do now is the consistent process of seeing the wine by evaluating the color and droplets, smelling it by identifying 3 fruity and 3 non-fruity aromas, and tasting it for four major wine taste criteria. 

The reality is, you are just like a honey bear: you probably can’t name all the smells and sights you’re experiencing, but you sure know which product hit your fancy the most. Thanks for having a listen, and I can’t wait for you to embark on your own wine tasting journeys!

Questions

I genuinely can't taste the difference sometimes when I have wines. It's all kind of the same. How do I start building out my palette and paying more attention to the stuff you were talking about, like smell?

I have no idea what kind of wine I like. How do you suggest I get started in identifying my preferences?

Do aged wines actually taste better? Why are they so much more valuable than not super old wines?

Feeling too corporate

One of the interesting questions that came out of speaking with my wine business house mate was why are you in the wine business? When discussing his marketing strategy he talked about how they use facebook and instagram pushing social content and event-based advertising. Whilst he has some time to collect data and running a/b tests, they are often too short of time to analyse them. 

However, outside of the inherent challenges of marketing a small wine business the challenge he has with his co-founders is around authenticity.  As a MBA student and former consultant he is always thinking about how he can optimise the performance of the business. Including wanting to be advertising on instagram and creating google search ads. Which as a fellow MBA - made total sense to me. The challenge he is facing is that he often gets push-back from his co-founders that it's too corporate feeling. It feels like he is running a business and they are following a passion. Which made me think...can you do both? 

When interviewing Nile Zacherele from David Arthur Vineyards he also had strong opinions on people getting into the business for the wrong reasons. His perspective was that too many people run wine businesses as vanity projects and not businesses - hence the high volume of small wineries, many of which are struggling. 

As they look to grow I think small wineries need to stop and think about who they are, and how they want to be perceived. How will they manage authenticity whilst meeting business objectives. As wine sales continue to decline understanding why you are in business and how you are going to differentiate yourself is going to be key for survival. The challenge will be balancing staying true to your brand and who you are, whilst taking the right corporate actions to be successful and defend against increasing competition in an consistently challenging market. 

Wine pairings

Part of how I love to experience wine is with food. Recently I have been fortunate enough to have several dinners with wine pairings and always wondered if it was a bit of a myth. Do certain wines pair with food better than others? 

The history of wine and food pairings is very cultural. Wine, for a very long time, has been a staple at the dinner table across many cultures. Therefore the habit of pairing international wines with their corresponding cuisine became the basis for many wine and food pairings today. However, eventually the act of pairing became an art form – one practiced by some of the most high-end restaurants today. 

But I do still wonder – do some wines actually enhance the experience of eating certain foods.

According to many food and wine experts it does – at least at a basic level. The most basic element of food and wine pairing is the balance between the “weight” of the food and the “body” of the wine. Robust wines, such as reds (e.g., Cabernet Sauvignon) would overpower a light, delicate dish, such as a quiche or a fish. Whereas, light-bodied wines, such as Pinot Grigio, would be overwhelmed by a boeuf bourgignon. Basically  – you want to be able to enjoy the taste of both your wine and your food without either one overpowering the other.

It isn’t just food and wine experts – scientists agree too. Findings published in Current Biology suggests that “mouthfeel", the way food feels in our mouths, is responsible for the phenomenon. For example, Astringent wines often feel rough and dry in the mouth, whereas fats are slippery. Eating them together helps balance the two out. In the study’s summary, authors refer to this “balancing” mechanism as “palate cleansing.” As a result, they found that participants in the study provided lower ratings of fattiness and stringency for the food and wine that they were tasting relative to rinsing with water.

It’s easy to make wine, it’s tougher to sell it!

Throughout the course we have heard about the challenges of working in the wine sector, specifically for smaller wineries. As part of our research interviews for our final project the quote from Tripp Donelan "It’s easy to make wine, it’s tougher to sell it!" really stood out for me.

The struggle for these small wineries is making great wine really is only one small part of the process. To generate a strong bottom line - these small wineries need to focus their time on direct to consumer sales, whilst also marketing their products to a wider market in order to get sales.

It appears that years ago, scores played a bigger factor in driving DTC sale and they have some impact - with a lot of high scoring wines at good price points. For higher price point wines we heard consistently that they need to get out on the road and do tastings/dinners, etc. This drives up costs and is time consuming for often small and understaffed teams.

Although many of these wineries do have marketing and analytics it is still a complex process to truly engage customers and know what they like and dislike. In an increasingly digital world, people are busy and often get 100s of emails a day. Fighting to get your brand noticed is hard and you can often be overlooked.

With these challenges in driving sales direct to consumer - I question what it will take to move from high touch to low touch sales for these small wineries. How can they leverage digital marketing techniques to still build an authentic and personal connection with their current customers, whilst acquiring new customers who are more open to building digital connections to brands.

Restaurant Wine Margins On The Rise?

The economics of on-premise wine sales, or sales of wine by the glass and bottle within restaurants, is a topic we covered in several sessions this quarter. Entering the course, I was certainly guilty of the "second cheapest wine on the list" approach, and found the breakdown of margin across the three tiers of the supply chain particularly interesting. Ultimately, we learned that restaurants typically list a by-the-glass price on par with their wholesale cost, and a bottle typically at 3x their wholesale cost. Wine Searcher recently released an article on how restaurant wine margins have been on the rise. The article points out that, with the digitization and democratization of information regarding wine quality and value, restaurant customers (particularly fine dining customers) are more quickly able to sanity-check the list prices on a wine list than ever before, bringing a new era of scrutiny to sommeliers. The article goes on to note that several restaurants with degrading four-wall economics (rising rent and overhead) look to wine as a cost mitigation strategy, and approach 4x or 5x profit per bottle purchased. As coronavirus continues to impact consumer behavior and perhaps, negatively impact traffic and transaction volume at restaurants, it seems we will continue to see some establishments attempt to expand margins on their wine list to combat this effect.

https://www.wine-searcher.com/m/2020/02/the-relentless-rise-of-restaurant-wine-margins

Being Responsible Sellers (and Consumers)

Dear class, 

I enjoyed our quarter, and especially last session together very much! Wine is such a convivial and lovely topic. I hesitate to add a sobering entry to our blog here about responsible consumption and sales of alcohol, but it's important to me and I'd love to get others' thoughts on it. 

*Disclaimer: I felt Alyssa set very safe parameters around alcohol consumption in the class, so these comments are strictly about outside experiences.*

Many of us, myself included, have loved ones who are alcoholics. This has weighed heavily on my mind as I have developed my own relationship to alcohol and prepared to sell it with Abbess Brewery. 

For my own consumption, I have some very simple rules around it that help me feel in control. Because I drink often, I drink in small amounts, no more than 7 drinks/week (CDC guidelines here). I also notice if I am drinking because I am trying to alleviate a bad feeling (unhealthy) or enhance a good feeling (healthy). I know other people who never drink alone and people who drink beer and wine but not hard alcohol. There are a lot of ways to go about this well, and I'm always curious to compare notes with other thoughtful consumers. 

Perhaps more important here are the parameters we should be setting around responsible selling. I understand and respect that people have freedom to make destructive choices with whatever means given. But because alcoholism is so common, I wonder what we can do on the business side to help, or at least not to seek to profit from someone's drinking problem. This could look like:

Interpersonal:

1. Modeling responsible drinking (maybe with some of the ideas listed above) and talking openly about those practices with friends and age-appropriate children. 

Regulatory: 

2. Governmental regulation. Maybe making it more of a controlled substance, have to pay for it by card that can be traced to an ID? I'm not sure because I'm not a big government regulation person. 

3. Including information more readily  available in places that sell alcohol about addiction recovery options. 

Businesses:

4. The obvious one here is training bar staff not to over-serve and to take note if someone is demonstrating self-destructive habits with their alcohol consumption. 

5. Offering lower abv and non-alcoholic alternatives. 

6. Encouraging customers to drink water, not serving alcohol without a glass of water as well. 

7. Limiting the amount of alcohol that can be ordered without food. 

Like I said, this isn't an easy topic, but I think it's one that we have a responsibility to consider as consumers and people in the industry, and I value your input. 

All the best,

A

The Sacred Land of Wine

   In the midst of widespread self-isolation, I really wanted a quick escape and a nice new bottle of wine. I wanted to purchase something unique, and I realized Whole Foods’ inventory would likely not quench my thirst. Also, Whole Foods lines are currently ridiculous. I decided to check out the variety of wines offered at an Armenian grocery store to hopefully find a bottle that would tie into my cultural identity.

   Armenia has an incredibly rich wine history. In fact, researchers found the world’s oldest winery in Armenia’s Areni-1 cave, which is over 6,100 years old. A friend and Stanford PhD recently worked in the cave as part of her research on the preservation of cultural heritage in the country. The public can visit the cave, which houses clay cylindrical containers for the production of wine.

  Upon Soviet rule of the country, brandy production became a primary focus over wine. However, today’s wine producers are uniting and strategizing in an effort to strengthen the country’s global wine reputation. Why now? For one, Armenians who have financially established themselves in different enterprises around the world are returning to and investing in the country. Furthermore, the last three years have seen the government work to assist winemakers by pushing a marketing approach that refers to Armenia as the “Sacred Land of Wine.” The country has 400 grape varieties, 31 of which are used for winemaking, and five viticultural regions. The country’s winemakers also use Armenian oak, which may be up to 250 years old and is cheaper than imported French oak. Armenian oak is considered more intense than French oak given lower humidity, meaning that less contact time with wine is required. 

   The wines are largely quite affordable. Some photos I have included of different Armenian wines available at the small grocery store I visited show prices ranging from $9.99 to $21.99. Furthermore, they are priced similarly to wines from neighboring countries, such as Georgia, which was covered in our midterm presentations. The most expensive Georgian wine observed at this grocery store was $24.99.

   We have discussed authenticity at length this quarter, and Armenia is a prime example of how authenticity can act as a marketing tool since they have literally backed up their claims of “sacredness” with a historical artifact turned tourist site. I believe this focus will work for the country. According to Vine & Wine Foundation of Armenia, the country’s vineyards have a lot of foreign investment with millions more dollars expected. The country currently produces around 10 million liters (2.6 million gallons) and exports 3 million liters (0.8 million gallons) of wine. Based on the wineries highlighted in the Forbes article linked below, which include winemakers who have gained their skills everywhere from UC Davis to Château Mouton Rothschild, the future looks bright for Armenia’s wine industry. 

Source: https://www.forbes.com/sites/tmullen/2019/11/04/armenian-wines-are-kicking-with-quality/#6f00ff3e70e3

A Fascinating Quarter

I entered this class knowing very little about wine. I could count the number of winemakers I knew on one hand, was ignorant of the three-tier regulatory system established by the 21st Amendment, and wouldn't have been able to identify the differences in quality between a Far Niente Cabernet and a Barefoot Sweet Red Blend. Alder Yarrow would have hated me.

Reflecting on the quarter, I believe I have become much more knowledge about the industry. I could tell you about the five growths of Bordeaux, from Chateau Lafite Rothschild to Chateau Ponet-Canet. I could talk about the economics of running a winery, and what growth opportunities lie ahead. I could tell you about major trends in consumer behavior, and how that is impacting key players across the wine value chain. I could speak about brand stewardship - the challenges that premium wineries face expanding downmarket. Even my wine tastes have become much more nuanced. Trying high end bottles from leading winemakers can do that!

Above all, the passion of our guest speakers left an indelible impression on me. These were not normal executives coldly dissecting the nuanced dynamics of their industry. These were people who grew up fascinated by their family's winemaking heritage and wanted to carry on their legacy. Or people who loved wine so much they quit their white collar day job to focus on winemaking, or wine blogging. I previously cringed when winemakers were called "artists". Now I get it. Entering the field of winemaking can be very much like moving to Hollywood to be an actor or writer. It's high risk, and only the best make it. But this proves that many people in the industry didn't enter for the money. Their craft brings them incredible joy. It's about the journey, not the destination.

I'm looking forward to impressing (annoying?) my friends and family over break with my newfound appreciation for wine and admiration for all the winemakers, importers, critics, distributors, marketers, and investors we met with or learned about in class.

Charles Shaw's Legacy

I feel very fortunate to have had the opportunity to speak with Charles Shaw during our final in-person class. I found his story to be a refreshing departure from many of the 'great man' narratives and founders stories we hear at business school.  This is neither a case of an enterprising genius relying on his work ethic, personal network, and savvy to achieve greatness, nor a tale of failure, disaster, and tragedy. Instead, Charles' story is somewhere in the middle: a nuanced, complicated example of multiple successes and failures mixed together, and leading toward a bittersweet conclusion that makes you wonder if the journey was worth it at all.

The contrasts in Charles' story are stark. His wine was chosen for three White House State Dinners, yet now America associates his name with cheap 'two-buck Chuck'. His passion for Beaujolais wines as the perfect complement to French staples and delicacies drove him to use Napa Gamay grapes in his wines, yet UC Davis researchers declared that his varietal was not "real" Beaujolais. He was a pioneer winemaker in Napa Valley at a time when there were "more acres dedicated to cattle
operations than vineyards", yet he spent years avoiding a return to Napa Valley after he moved to Chicago. After all his hard work and success, both his business and marriage ended "badly".

This quote from Charles' 2016 reunion address sums up the pathos of his story:

"When I moved to Chicago divorced and heavily in debt from General Partner
guarantees, Illinois was still a unit banking state and it took me ten years to establish a
checking account in the state due to my financial difficulties"

There is a matter-of-fact tone to his recollections that conveys incredible sadness, especially later, when it concerns the interminable 'adjustment period' of getting over his divorce. Yet, he spoke proudly of his children and grandchildren when he met with us in class.

I wonder if Charles, knowing how everything would turn out, would do it all again. How does he feel about his name living on? I'm sure he would much prefer the Charles Shaw name embody the high quality Beaujolais that he worked so hard to perfect. But still, he is the namesake of a brand that sells over 30 million cases from a single retail chain. I hope he continues to discuss his journey, share his ups and downs, and provide advice on how to navigate an ambiguous world where "success" can be very difficult to define.

19 Opportunities & Challenges for Wine in the COVID Climate

19 Opportunities & Challenges for Wine in the COVID Climate

With a largely unprecedented slowdown in economic activity and the recent declaration of a national emergency by President Trump, it's worth stepping back to evaluate how the production, distribution and sale of wine might be affected. Below are 19 thoughts on how the world of wine might change in response:

The Good

1. Delivery

While we've questioned the legality of Drizly and other "Doordash-for-wine"-type services, I'd hedge my bets that many people will still want to buy wine, albeit in proportion to their decline in disposal income. That said, the most obvious short-term shift in how people will want to consume is the transition to in-home drinking. Whether you have access to premium wines or work with two-buck Chuck, try and get on these apps (or build one of your own) to meet customers where they are.

2. Getting High on Wine

If people are bored and locked in their rooms, they'll quickly start to look for ways to differentiate their "quarantine experience". The potential to pair wines and highs (e.g. edibles, MJ-infused drinks) strikes me as compelling. It's hard to "size a market" for this truly since we don't understand customers' fundamental willingness to buy in the context of a pandemic, but despite declining stocks in the marijuana world, they might be in for a rebound.

3. Emerging Regions

As basically every large urban center gets hit by COVID-19, there is no better time than now to perform that long-overdue diligence on "the next hit wine region". Maybe it's Michigan, maybe it's somewhere in Scandinavia, but the time is now to build a strategy for tackling your highest-priority countries/state that are hopefully less affected than primary wine-consumption regions.

4. Going Digital

In addition to delivery and other in-home mechanisms, the (unfortunately?) simplest way to reach people nowadays is through a screen. Now's the time to build that beautiful Instagram page and do what Maker Wines did in creating a brand from the ground up. Particularly if you're a business that's not quite going under, but still taking a substantial shortfall, the opportunity cost of allocating your time to web development and digital advertising has never been lower.

5. Monetary Easing

On March 3rd, we already saw the Fed slice rates by .5% (likely heartbreaking to all those within 3 degrees of separation from Yellen and Bernanke) in an attempt to mitigate the economic panic which ultimately ensued anyway. Unfortunately, this approach hasn't quite cut it either, but the long-shot hope would be that if this crisis is resolved earlier than individuals expect, the lower rates (including the possibility of further cuts to reignite the economy) could yield long-term commercial benefits. This need not happen, and rate expectations may simply be baked into all subsequent economic forecasts from here on out, but it remains to be seen.

6.  Getting Lean

For long-standing organizations and start-ups alike, sometimes major change only happens when the envelope's pushed. Through the lens of a crisis, some can now only begin to see changes that should have happened, loose ends that should have been tied up, and all the unnecessary elements that don't really have bottom-line value to your business. Taking a cold hard look at what you truly need could lead to longer-term gains that otherwise might not have been noticed without this global prompting.

7. Buy Low

If you're an incumbent in position to weather the storm, everything from companies to physical land could exhibit massive fluctuations in value. Be on the lookout for start-ups with superior technology and other high-leverage assets whose value is naturally premised on a company's capacity to stay afloat. Sweep them up and turn what would have been a market disruption into your next business line. If you're one of those companies, getting acquired for a halfway-decent price might be a small concession to pay when the cost to non-acquisition could be your business.

8. Turnaround Specialists

Positioning your firm / consultancy to capitalize on the fear that a number of businesses will feel could yield some serious cash, as callous as that sounds. If you're already a firm that does this, hire a few wine experts who can help channel your turnaround expertise into the wine space.

9. A Time to Lobby?

Could immediately post-crisis be the most opportune time to lobby for a repeal of the semi-archaic 21st amendment here in the U.S.? The argument that D2C is the future -- and at times like this a necessity -- could be much more tangible following this global moment. Is it a public health liability to not offer direct-to-home delivery for a number of businesses? Could someone at least find a bottle to settle our President after his pre-address prop-sensitivities?

10. This Might All Be Way Overblown

If the virus peaks in three weeks, these types of fears might seem wholly out of proportion. That, in part, would fly in the face of much of what the WHO and CDC are reporting, but it's entirely possible that the peak of this virus and it's economic impact are truly short-term in nature. If you're truly long on wine, bob and weave.

The Bad

11. Restaurants Closing

If restaurants begin closing and "medium-scale" human interactions come to a halt, wine will take a hit as people fear the simple occasion of going out to eat with their friends.

12. Data-Driven Decisions

The notion that an industry already beleaguered by piece-meal data may dramatically chalk an entire quarter or two of information up to COVID-19 could markedly hold this industry back from its already slow climb to analytical sophistication. Extrapolating outwards, it's hard to say when forecasts will return to reliability (especially if this becomes an annual phenomenon). Thirdly, the incentive for an individual wine player to invest in analytical capabilities is likely just going to be pushed to the back of the back burner. 

13. Public Gathering Bans

If Trump and other world leaders march in line with Italy, Rwanda and a few other nations who have put public bans in place, this could limit not only restaurants, but wineries, festivals and other events where wine is commonplace.

14. Delivery in Action

While I think delivery-based mechanisms could be a huge option and something worth investing in for every time-course, if the supply of delivery agents dries up due to fears of interacting with dozens of customers/day, there won't be anyone to actually bring food anywhere. Watching what DoorDash and UberEats do over the next few weeks will be very revealing.

The Ugly

15. Manufacturing Centers Shut Down

If major wine-producing regions forecast low demand, they might decide to shut operations for the foreseeable future, drying up the supply chain in lieu of their grapes.

16. Inventory Players Collapsing

The possibility that middlemen (i.e. anyone who takes wine from A-to-B) go under could seriously undermine both global and local supply-chains. If cash flow is an issue, and warehouses pile up with wine that's no longer in demand, these entities could be overwhelmed.

17. Public Travel Bans

The halt of trade and general travel could bring us into a recessions/depression scenario that is of such magnitude that every industry is markedly affected, including wine.

18. Distributing/Importing from China 

No one knows exactly where the distribution and import of wine is going per se, but I'd be hard-pressed to believe it's going up. At the epicenter of this crisis, the delays and fears around Chinese manufacturing are warranted, and will significantly slow any business--especially those that are inventory-sensitive--from keeping the cash on hand they need to maintain operations. If people can't use or produce materials that go into the production, shipping and packaging of wine -- let alone execute on that production, shipping and all other operations due to China's limitations -- this could ripple out to affect the entire global supply chain.

19. Basic Selling in Highest-Consumption Regions

Basic problems of people being sick and not physically able or wanting to drink -- combined with inventory crunches from local producers in France, Italy, China, Japan, the U.S. and all other large markets -- could seriously limit fundamental business functions in the short-term.

Summary

Sure, the risks trivialize the wins in times of pandemic. And yet, as we continue to react the best we can to prevailing market dynamics that largely escape our control, the organizations that will emerge with something to show for it are those that find a way of doing the following:

(a) Relentlessly finding means of limiting their downside,
(b) Proactively putting their remaining time and energy into efforts that would normally have been low-priority, but which now have the lowest opportunity cost to date, and
(c) Getting creative and exploring new-wave business models that, due to COVID-19, may now become industry-standard much more quickly than initially thought.