In wake of some of the latest chatter about The Wine Trials 2010 (this one from Joe Briand, wine buyer for New Orleans’ excellent Link Restaurant Group, e.g. Cochon, Herbsaint, with a response from Wine Spectator executive editor Thomas Matthews), I thought it was time for a quick clarification of first principles here.

People have sometimes (often, maybe) misinterpreted The Wine Trials (and The Wine Trials 2010) as making the claim that no expensive wines are worth the money, or that cheap wine is generally “better” than expensive wine. In fact, I make neither one of those claims in the book.

Rather, my basic points are these:

(1) Evidence has shown that most everyday wine drinkers (not wine professionals) don’t prefer more expensive wines to cheaper wines in blind tastings. This is separate from the question of whether the properties of expensive wines are aesthetically superior in the minds of experts.

(2) Many (but certainly not all) expensive wines, such as the luxury brands from LVMH—which are advertised much like the group’s TAG Heuer watches, De Beers diamonds, Guerlain perfume, or Louis Vuitton handbags—are overpriced because such a large portion of their cost base is spent on marketing. This doesn’t just go for superpremium wines like LVMH’s Château d’Yquem, Krug, and Dom Pérignon; it also goes for brands like Cloudy Bay, a straightforward New Zealand Sauvignon Blanc whose price—without any apparent change in the production method—rose from about $15 per bottle to about $30 per bottle after LVMH acquired the brand in 2003 and began marketing Cloudy Bay as a luxury product.  To me, when the consumer dollar is going more toward advertising than toward materials or production, it’s a paradigm case of overpricing. It bothers me that the mainstream wine media doesn’t take brands to task for this. (more…)

The lead paper in the new issue of the Journal of Wine Economics is a study by Jonathan Reuter arguing that Wine Spectator wine ratings for advertisers were about one point higher than ratings for non-advertisers, when controlled against ratings from Wine Advocate. This is in spite of the magazine’s stated policy of tasting wines completely blind.

This from the abstract:

“In markets for experience goods, publications exist to help consumers decide which products to purchase. However, in most cases these publications accept advertising from the very firms whose products they review, raising the possibility that they bias product reviews to favor advertisers…Although the average Wine Spectator ratings earned by advertisers and non-advertisers are similar, I find that advertisers earn just less than one point higher Wine Spectator ratings than non-advertisers when I use Wine Advocate ratings to adjust for differences in quality.”

These are wine ratings, not the restaurant Awards of Excellence, which I’ve written about in the past (more…)

Portland, Oregon, the current darling of America’s food and environmental writers, is arguably the county’s most bicycle-obsessed city. Bike use was up 28% in Portland between 2007 and 2008, and on the Hawthorne Bridge, a main thoroughfare, bikes now make up 20% of all vehicles. The New York Times estimated in 2007 that there were 125 bike-related businesses in Portland employing 600 to 800 people. There’s even a store in the city that sells only tricycles.

When I arrived in Portland last month, the first thing I wanted to do was buy a bike and get around the way the locals do. Since I wouldn’t be in town for too long, and it wasn’t clear that I’d be able to take the bike with me when I left, I wanted something extremely cheap.

There were bike shops on every other corner in Southeast Portland, the sort of Brooklyn-ish neighborhood where I was staying. I walked into what looked like the grungiest of them—a store that sold mostly used bikes. There was one employee, and he was heavily tattooed and seemed pretty cool. I completely leveled with him (more…)

We may disagree about our favorite artists and musicians, but it’s relatively easy to agree that a particular color is blue, or that a particular note is C-sharp. They’re described by wavelengths and frequencies along a clearly defined spectrum. That’s why the technologies of visual and auditory reproduction—photo, video, audio—work so well, relatively speaking.

Worth a thousand words?

With taste and smell—the so-called “chemical” senses, which are more complex (humans have about 400 different types of olfactory receptors) and less well understood than the others, we don’t have the luxury of those points of reference. That’s why we so often resort to loose analogies—“tastes like chicken”—and it’s also why reproducing tastes and smells is so difficult (grape soda doesn’t taste much like grapes, and nobody’s yet synthesized a bottle of 1945 Pétrus—an activity that would surely yield tremendous profit).

To challenge this barrier, we resort to analogy. Coffee tastes like nuts and chocolate; Sauvignon Blanc smells like grapefruit and cat pee. In a Sauternes, you might sense the brine of the first green olive you tasted in Italy; in a Pedro Ximénez sherry, the viscous maple syrup that your grandmother once drizzled on your pancakes.

But how carefully are we really choosing these adjectives and analogies? (more…)

One of the most thought-provoking papers at this year’s meeting of the American Association of Wine Economics was presented by Günter Schamel, a professor at the Free University of Bolzano.

Not empty for long?

Schamel’s study, which is still in progress, has thus far looked at a data set of 260 eBay auctions of empty wine bottles. In his model, the most powerful predictive variable—explaining both the incidence of sale and the final auction price of an empty bottle—is “the price a full and presumably authentic bottle could potentially fetch in the marketplace.”

Schamel argues that this is “powerful evidence that the empty bottles might go on to be refilled. Why otherwise would someone want to pay more than 100 euros for an empty bottle of 1982 Chateau Lafite-Rothschild rated with 100 Parker points? Presumably, because it is worth a lot more once it is filled up again.”

Certainly, notwithstanding a recent incident in which a customer at a London restaurant sent back a £18,000 magnum (more…)

Sweden has one of the world’s most controlled alcohol regimes, with steep taxation, a state-controlled retail monopoly, and a 20-year-old minimum age to buy alcohol at a store (and they really card, too). The only store at which a consumer can buy wine, beer, or liquor in Sweden is Systembolaget, the state-controlled retail monopoly.

Is this a good thing or a bad thing? My intuition (and that of the economists I’ve been speaking with here in Stockholm) is the latter—first and foremost, as in Quebec, it’s a major headache for wine producers, whose distribution chances hang on the (often arbitrary) whims of just one decisionmaker. Opening hours of stores are criminally short. Pricing is screwy, in part because per-unit (rather than per-krona) taxation results in cheap wine being overpriced and expensive wine underpriced. As ever, monopolies throw everybody’s incentives out of whack.

But here’s one definite consumer-oriented boon that results: in an of-the-people move, Systembolaget wine stores—that is, all wine stores in Sweden—are organized first by color, second by price. There’s the 69-kronor-(US$8.71)-and-under red wine section; there’s the 70-kronor-(US$8.84)-to-99-kronor (US$12.50) red wine section; and then there’s the 100-kronor (US$12.63)-and-up red wine section.

Although I’ve seen US wine stores with special $10-and-under sections and such, I’ve never seen an entire store organized this way. Intuitively, at least, it seems to be more aligned with consumers’ game plans as organization by region, grape, and so forth.

Why don’t non-monopoly stores organize this way?

My guess would be that profit-minded stores, for understandable reasons, don’t want to lose the chance to upsell—they want people to walk away with a wine more expensive than the one they came looking for.

Ethics scandals are politico porn. They’re also fertile ground for undeserved scapegoating. But there’s one category in which, across the board, there’s not nearly enough public stoning going on: the world of information intermediaries. On the government side, that means regulatory agencies; in the private sector, it’s the critics, the expert witnesses in capitalism’s de facto justice system.

Information intermediaries, we’re to understand, are society’s check against puffery. They make careers of trustworthiness and accountability. In society’s service, they apply rigor to the claims of corporations and analyze their standards. For this hard work, they’re rewarded by the marketplace and by the United States—sometimes handsomely, sometimes not.

Two bits of recent news bring about two otherwise disparate intermediaries, both preeminent in their niches—Robert Parker’s Wine Advocate, the publication whose critical appraisals are one of the central determinants of a wine’s success or failure on the marketplace, and the Federal Aviation Administration, the agency whose critical appraisals are the primary safety check against America’s airlines—systematically abusing that authority.

Jay Miller: Disfrutando?

Parker’s is one of the few wine publications that don’t accept advertising, for which he deserves praise. And it’s certainly acceptable to take free samples of wine from producers—that’s often the only way to taste new releases before they’ve gone to market. But the recent transgressions of Jay Miller, Robert Parker’s right-hand man, are spectacular indeed. In another classic case of the traditional print media jumping on the bandwagon of a topic that had been exposed quite a bit earlier by an incisive blogger—in this case, Tyler Colman, who goes by “Dr. Vino”—Miller’s series of all-expenses-paid vacation/junkets, financed by wine producers, have finally been reported by the mainstream media in a recent Wall Street Journal article.

Some of rumors about Miller’s behavior in Argentina go quite a bit further in scandalousness (more…)

Fresher wine, or just a pretty face?

I’m not sure which of the following two myths is more ridiculous: the myth that you can re-cork a half-drunk bottle of wine and keep it around for a week and have it “still be good,” or the mutually exclusive, but equally misguided, myth that you can keep wine from going bad with commercial “wine preserver” devices. The media is largely responsible for both of these myths—the first because of ignorance, and the second, perhaps, because of advertorial content and the power of suggestion.

What’s amazing is that almost nowhere in the media do I see discussed the magic solution to keeping leftover wine fresh—the solution that winemakers already know about—which I’ll discuss below. First, though, about the media myths:

Myth 1. You can re-cork wine and keep it around. I’m usually a fan of Consumer Reports, but their wine coverage has long been weak, and they got it embarrassingly wrong (and did the wine world a disservice) when they suggested that (more…)

The New Yorker’s recent profile of Fred Franzia has sparked a debate amongst the wine pundits on the question of why it’s so hard to find good American wines under $10, under $12, or even $20. I had an interesting conversation on this topic with Tyler Colman the other day. There’s a debate on the topic on Tyler’s blog, Dr. Vino, where he asks his readers to weigh in on these potential theories:

“Short-ish history of American wine with relatively few small growers, recent industry consolidation, the soil and/or climate, high land prices, producer greed/pride, the three tier distribution system, or the consumer as chump.”

Beautiful place, for a placebo

Eric Asimov at the New York Times has also recently commented on the difficulty in finding good, cheap American wines on his blog and in print. In the print article, he seems to gravitate toward the “shortish history” explanation, together with a discussion of a dominant social/consumer norm in the US wine market that leads producers to gravitate toward a single, uninteresting style (a style that I think has been promoted by many wine magazines). Asimov writes:

“In modern American wine history — post-1960 — the selection of grapes is monochromatic…In effect, then, California produces a small amount of top-flight wine along with an ocean of generic wine that seeks to imitate the top echelon, often through artifice like oak substitutes and additives. All too often, the choices are expensive cabernet or chardonnay, and imitation expensive cabernet or chardonnay.”

A similar perspective on Asimov’s blog:

“Very little wine is flawed in this day and age, now that we understand the science of winemaking and the importance of hygiene and temperature control in the mass-production of wines. But it is insipid… (more…)

Not funny at the time

Like golf, baseball still has some touchingly quaint pen-and-paper blue laws, and when Tampa Bay Rays manager Joe Maddon signed an incorrectly filled out scorecard for Sunday’s game against Cleveland, the Rays lost their designated-hitter privileges (the American League allows the DH to bat for the pitcher). As such, pitcher Andy Sonnanstine, who shouldn’t have normally had to bat at all, wound up not just having to bat, but having to bat third—the lineup spot normally reserved for the best hitter on the team.

Sonnastine did just what would be expected of a #3 hitter: he went 1-for-3, with an RBI double in the fourth inning. Tampa Bay won the game, 7-5.

Of course, 1-for-3 is hardly evidence of anything. Even AL pitchers get hits every now and then. And maybe Sonnastine also secretly happens to be a good-hitting AL pitcher (there’s insufficient but still interesting evidence of that: he’s 5-for-13—.385—in his career).

But another account (also with insufficient evidence) would be that he was made to feel like a #3 hitter on Sunday, so he performed like one. That explanation would dovetail (more…)