What do you know about your competitors?

Wednesday, 13. December 2017 - 10:30

If you produce a wine that sells in any volumes in the US, a well-informed American friend told me recently, Gallo almost certainly knows more about it than you do. Warming to his theme, he went on to say that the giant of Modesto would not only have analysed the way your product tastes, but also the way it’s marketed, distributed and, quite possibly, received by consumers. And in case you imagine that this would only apply to wines that compete with Gallo brands like Barefoot and Apothic, my friend pointed out that, as the owner of the MacMurray Estate Vineyards in Sonoma and US distributor of Allegrini, it might be just as relevant to a producer of Californian or Italian premium and super-premium wines.

When I told a French producer about this conversation, he gave a Gallic shrug and pointed out that it was easy for a big, rich New World wine company to do all that kind of research, but out of the question for someone like him.

So, I asked, what preparations do you make before presenting your wine to a potential overseas customer? Do you look at the kinds of wines they already sell? This question was greeted with a look of incomprehension, as if the task of googling the distributor was far beyond his capabilities. Stated simply, his modus operandi was to turn up at a buying office with his wine and his price list in and wait for an order.

Ask any importer or retailer and they will tell you about countless encounters like this. Companies that exclusively sell Spanish wines regularly receive unsolicited samples, or at the very least emails, from Italy. Producers of inexpensive Vin de Pays waste their time approaching fine wine specialists, and vice versa. When the huge UK supermarket chain Tesco invited wineries from across the world to pitch to them at the London Wine Trade Fair a few years ago, Laura Jewell, the then head of the buying department, spent much of her time explaining the basics of retailing. “Producers would be surprised that I wasn’t excited by their offer of 1,000 cases of nice, but not exceptional Muscadet,” she said. “They hadn’t given a moment’s thought to how it would fit into our business.”

The problem for that Muscadet producer is that a growing number of his competitors now think at least a little like Gallo. They may not have chemically analysed or focus-grouped his wine, but their sales presentations will include reasons-to-buy that go way beyond quality and price – and quite possibly the traditional thinking of the region in which they are based. A producer of good, inexpensive, Languedoc Pinot Noir might convincingly pitch that wine as an alternative to an example of that grape from Chile rather than another wine from France.

In short, there will be at least an attempt to understand what the buyer wants, and a proposal for how listing this wine might help her to achieve it. There might not only be reasons why their wine would be an ideal replacement for a similar effort that’s already being listed; there might even be a proposal for how well the new wine might complement a pricier or cheaper offering from a competitor.

The unprepared wine producers are far from unique. Viewers of the TV programmes Dragon’s Den and Shark Tank often see participants ask for hundreds of thousands of dollars’ investment in their concepts – without having done the basic maths that anyone who has ever watched the show knows to be essential. Almost every series of Masterchef includes a cook who fails at making pasta. Or who prepares a ‘signature dish’ they’ve never cooked before. These failures are part of what makes series like these such compulsive viewing.

Followers of another ongoing confrontational TV drama – the Brexit negotiations – have seen the diplomatic equivalent of the Muscadet producer, in the shape of British politicians blustering about how the 27 remaining members of the EU are going to give them what they want. If those Britons had simply taken the trouble to listen to the former Greek finance minister Yanis Varoufakis’s description of his own experiences in Brussels, they’d have saved themselves a lot of trouble.

But the wine producers reading this column should be able to perform much better than unsuccessful participants in TV shows and hapless British Brexiteers.

Here are my questions to producers: how much time have you spent thinking about what your existing and potential customers want and need, rather than your need to sell them your wine? Do you really know who your competitors are? And are you confident of your understanding of how your offering compares with theirs?