Why are California wines so popular
In all the wine-producing areas of New World countries, the U.S. state of California is a successful case which is worthy to learn for emerging wine-producing areas. As we all know, the United States is the world’s No.1 wine consumer and No.4 wine producer. The sales volume of California wines accounts for nearly 70% of the total of the U.S. wine market, and the share is still rising further. Unlike some New World wine-producing areas which are dependent on exports, California basically “produces and markets wines on its own”, which is a sound development model. At the same time, California wine exports have been growing year after year. Let’s take China as an example. According to the Wine Institute of California, in 2016, California wine exports to China increased by 11% by value and 47% by volume. The figures are really impressive.
Although California began to grow grapes and make wines as early as the 1860s, yet the famous Prohibition on alcoholic beverages destroyed the whole wine industry overnight. So California’s wine industry has a history of merely several decades. Why are California wines so popular?
Recently, I wrote an article entitled “Why are California Wines Tasty”. In the article, I analyzed the reasons for the popularity of California wines from the perspective of quality. In an era with abundant choices, quality is always in the foremost place. Without excellent wines, even the top-notch marketing is futile. In addition, California wines win popularity for the following reasons.
California was the first to introduce the concept of “grape varieties”. Before that, most of the wines from Europe were named after their origins. For example, the wine made in the Burgundy region in France was called “Burgundy”. People didn’t know how to name wines which were brewed in the same way but produced in regions outside the origin. As a result, there were many “Bordeaux” and “Burgundy” made in California in the market. In order to shake off the “shadow” from the countries of origin, Californians took the lead in marking grape varieties on the wine label, such as “Cabernet Sauvignon”, “Chardonnay” and “Pinot Noir”. This approach has distinguished California wines from those of the same varietals made in the countries of origin. Moreover, it has made California wines easily remembered and understood by consumers.
Regarding regulations and policies, the U.S. AVA (American Viticultural Area) system designed to protect places of origin is more flexible. To gain the status of AVA, local coalitions of grape growers or wineries should submit an application to the Alcohol and Tobacco Tax and Trade Bureau (TTB) of the United States Department of the Treasury. Applicants should provide evidence that growing conditions such as history, climate, soil and water volume are distinctive. The authentication and approval of the TTB is a must. An AVA is usually composed of several sub-areas. Take a winery which has vineyards across the Napa Valley as an example. Previously, the winery could only mark Napa Valley on the wine label. Now it can label its wines as Oakville, Rutherford, St. Helena, etc. according to different sub-areas where the vineyards are located. Such an approach enriches the variety of the winery’s products and gives consumers more choice. It is also worth noting that AVAs only delimit wine grape-growing regions and have no limitations on the varieties of grapes and brewing methods: whether it is Cabernet Sauvignon, Chardonnay or Sauvignon Blanc, all wines made in the Napa Valley can be marked “Napa Valley” on the label. It sounds very simple, but in Old World wine regions which enforce laws and regulations on strictly defining legitimate grape varieties, such a system is impossible to exist.
California has done a good job in wine marketing. The United States has ideal wine consumer groups with a large population base. California’s wineries practice market segmentation in line with different consumer groups’ consumption habits and taste preferences and introduce some specific wines accordingly. Such an approach is quite effective: The popularity of Chardonnay put in barrels in the United States fully prove this point. Until today, Chardonnay is still the most widely cultivated grape variety in California. Data of the last two years show that the sales volume of Chardonnay put in barrels has a downward trend. Many wineries have responded by adjusting growing and brewing methods to adapt to market changes. In addition, the Wine Institute of California and the California Travel and Tourism Commission cooperate to actively promote wine tourism projects. In California, visiting wine cellars (Cellar Doors) in wineries has become a way of life, attracting a large number of domestic and foreign tourists.
California wines sold in the local market account for nearly 70% in terms of sales value. The remaining 30% is sold to dozens of countries on the international market. Thus California faces little pressure in exports. Nevertheless, Californians attach great importance to the international market. In 2013, the Wine Institute of California organized vintners to come to China to attend the first edition of ProWine China held in Shanghai. Additionally, it specially invited service teams from the United States to provide on-site service for the vintners, reflecting that the organization attached much weight to the exhibition. During ProWine China 2016 held in Shanghai, the Wine Institute of California also specifically invited Yao Ming to attend the exhibition as the boss of Yao Family Wines, which was of tremendous significance for enhancing the visibility of California wines in the Chinese market. Actually, California already started the collective marketing of wines in the 1950s. At that time, the “Fine Wine Alliance” composed of several wineries began to promote California wines around the world. To this day, California’s top wineries like Ridge (Ridge Vineyards) still spare no effort to promote their own wines across the world.
Reasonable product classification and price range is also a major reason for the popularity of California wines. California wineries have attracted numerous investors from all over the world. These investors go all out to brew good wines at all costs, which has actually helped build a high-end image for California wines and also raised the overall price of California wines. On the one hand, high-end wines have their niche consumer groups, and the wineries can always achieve annual sales targets. On the other hand, the high-end image of California wines ensures that local leading vintners reap reasonable profits.
California wines have gained popularity not for a single element nor is it the result of short-term efforts. The Californian model of wine making and marketing is worthy to learn for emerging wine-producing areas around the world.
- Mei Ningbo -