Exactly five years ago, Robert and Peter published the first episode of XChateau! To help us reflect on how the wine market has changed in the last five years, XChateau’s most frequent guests, Amanda McCrossin and Charlie Fu, return to discuss the changes in wine influencing and social media, the wine market upheaval occurring now, wine marketing done right, and wine drinking trends.

Detailed Show Notes:

Changes to being an influencer

• AM: did not think TikTok would be big for wine in 2020, built it up in 2021, and created more “snackable content” (<90 sec videos), reaches wider audience (late 20s to boomers, more female) on TikTok
• Influencers are changing, and many get burnt out (including Robert)
• Influencer growth today - e.g., Olivia Tiedemann (@oliviatied) went from 0→4M followers on IG in 2 years, raw, skilled, edgy style caught people’s attention, used collabs to keep growing

Social media evolution

• Things are more video-heavy today vs. the static content of 5 years ago
• Not a lot of male creators (tend to be older, more “academic”), female creators are much better at wine education
• YouTube skews more male, TikTok more female
• Males tend to consume more long-form content, while females tend to consume more short-form content
• IG likes higher production quality, TikTok more “authentic” videos, IG upped video content length to 3 mins
• Rednote (Little Red Book) - a popular Chinese app for local food & beverage recs, particularly in Asian dominated communities

Wine market upheaval

• PY: Anti-health messaging is hitting wine more than other alcohol, reversing the trend of the last 30 years, fueled by the “French Paradox” research on positive heart benefits of the Mediterranean diet
• Premiumization is somewhat continuing - the top 1% are maintaining the high-end market, while others are trading down
• AM: “Wine isn’t cool,” wine is not great at being in pop culture today
• PY: Taylor Swift helping things like Sauv Blanc, but she’s not out talking about wine (AM)
• AM: Wine needs an Alix Earle (@alix_earle) w/ a glass of wine or maybe more medium-sized influencers (100-500k followers)
• CF: Health kick is a major trend impacting alcohol consumption, fewer people at restaurants ordering wine (at least in LA), people pushing NA options
• AM: people not interested in the <$10/bottle category (except things like Kirkland wines), want $30+ bottles but need to sell the wine as there is so much choice
• AM: Wine needs to revamp its merchandising to reach more people (e.g., more by style than varietal)
• CF: High-end wines getting cheaper and more available; when top wine prices fall, alternatives also crash
• AM: No such thing as brand loyalty anymore, NDA wines big for Wine Access (private label w/o being about to say the source)

Wine marketing done well

• CF: Winemakers from Burgundy (e.g., Dujac) are out there a lot more, increasing the popularity of the entire region
• PY: Doing more experiences both at the winery and on the road
• AM: Clean wine movement (e.g., Avaline) has some negatives, but is positive in terms of giving more transparency (what many consumers want these days)
• RV: ingredient and nutritional labeling on the bottle is better than just available on the website; PY: NA wines have full nutritional panels, which could help promote wine’s good sides

Wine drinking trends

• AM: Sauv Blanc is America’s grape right now, theory: women think it’s a healthier option due to its lighter, crisp style
• CF: people not drinking as broadly, but more hyper-focused due to so much available information (e.g., William Kelley and Burgundy); fewer people drinking natural wine

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Spraying for powdery mildew can be ~25% of the cost of farming a vineyard and be one of the key elements of a grower’s carbon footprint. Sarah Placella, Founder and CEO of Root Applied Sciences, has taken her deep research in microbes and created a data-driven solution to monitor the air for mildew and spray only when needed. Root can cut ~5 sprays per season, and growers have an average 5x ROI using the system.

Detailed Show Notes:

Root Applied Sciences (“Root”) - airborne pathogen monitoring for farmers, like an “early warning system”

• Founded in 2018, 1st work with/ growers in 2021
• Powdery mildew (“PM”) is a big problem for vineyards in CA (March - August)
• Currently only markets to vineyards, done work with/ strawberries, leafy greens, can do anything with/ DNA and small insects
• Napa, Sonoma, Central Coast today

HW enabled SaaS model - Root owns and maintains devices

• Device in the field, just above the canopy
• Send data (battery status, device status, temp, humidity) to the cloud over LTEM connection
• SW to see the data
• The grower collects samples from devices 2x/week and sends them to the lab
• Growers can share data with/ each other

Has an automated prototype in process

• Will not need a grower to collect and send samples
• Fundraising “seed” round for an automated system

~25% of operational costs are spent managing PM

• 6-16 pesticide applications/season
• Conventional growers have fewer applications, but spend more for each one
• Organic may be spraying every week
• PM takes 7-10 days to enter plants. See 2 peaks of PM before growers can see it, once PM exists, it's hard to control
• Root can cut 20-80% of sprays (~5 sprays/season), lengthens spray intervals when low risk
• ~$100/acre spray cost per application, ~$300/acre if need to spray by hand (e.g., steep slopes)
• 2024 - saw PM on Mar 29 in Carneros, growers planned 1st spray 4/16, moved up 1st spray to 4/2; cut sprays and more clean fruit
• Root data enables more biological sprays (have shorter efficacy windows, are more environmentally friendly, and data gives more confidence to try them)

Other benefits of Root

• Clean fruit - faster fermentation (5 days faster), higher quality, possible increase in yields
• Environmental (less sprays, tractor use) - less diesel use, lower soil compaction; for 1 grower, 1 spray is a 13% reduction in carbon footprint
• Farmworker health - fewer chemicals in the air

Pricing

• $3,000/season/monitoring station all-in
• Avg grower has 4 stations, 1 every ~30-50 acres
• Precision growers or rolling hills, 1 station every ~10 acres

~5x ROI

Barriers to adoption

• Risk aversion
• No access to a carrier to send samples
• Grape prices down (budgets)
• More adaptive sprays can make operational scheduling harder for vineyard management companies

Other PM solutions

• “Spray and pray” (~90% of growers) - calendar-based system
• Weather-based tools don’t work well and may be impacted by climate change
• Spore trapping tools (e.g., spinning rods, roto rods) have sticky material that reduces sample size and efficacy, UV light exposure degrades PM
• Image-based analysis (new) - lots of data to send, samples ~2L air/min vs 400L air/min Root, does not specify type of PM present (~40 types)

Product roadmap - more power efficiency, integrating a solar panel

Has done work with/ downy mildew, botrytis, vine mealybug, and can detect them, but does not add a lot of value

Excited about growth in microbial mildewcides (biologicals)

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With over 1,000 kosher wines from across all major winegrowing regions, Royal Wine is the largest importer (and producer and distributor) of kosher wine in the world. Gabe Geller, Director of PR & Wine Education, discusses the market for kosher wine, how and where it is made, and how Orthodox Jews hear about them.

Detailed Show Notes:

Gabe’s background, at Royal Wine >9 years, wine industry for 16 years (retail, consulting, marketing)

Royal Wine - world’s leading importer, producer, distributor of kosher wine

• In US, carries >1,000 kosher wines from every major wine producing region
• Owns Kedem, Herzog, and other brands

Can’t taste kosher wine, similar to other wines

• Produced only by Sabbath observant Jews
• No non-kosher ingredients or processing agents (e.g. - fining agents)
• Has kosher certification on the bottle
• Mevushal (“boiled”) - for some kosher wines, uses flash pasteurization which is also used by some non-kosher wineries; tend to taste more approachable initially, but ages longer

Israel #1 producer of kosher wine (~5M cases), USA (~350k cases; mostly Herzog), France (~350k cases across many wineries)

Kosher wine market

• Observant Jews drink kosher wine year-round
• Jews use wine in almost every religious ceremony, considered the “holy beverage”
• Passover 1st night dinner (Seder), every adult is required to drink 4 cups of wine (can by any kosher wine or grape juice), each cup symbolizes 1 way God saved Jews from slavery
• Jews who don’t do kosher normally will for Seder
• 40% of kosher wine in the US is purchased for Passover (used to be 60%, declining as more quality kosher wines available, so more is being bought year-round)
• Top markets - Israel, US (NY/NJ #1, FL, CA - CA Jews drink less wine than East Coast Jews), France

In top kosher markets, large retailers (e.g. - Total Wine) will have a kosher selection, some kosher wine stores, and online retailers (e.g. - Wine.com) also carry kosher

Of the 15.7M Jewish people (2023), only a small portion keep kosher

Some kosher wines sold to the general market (e.g. - Bartenura Moscato #1 imported Moscato the past 15 years, most don’t know it’s kosher; Jeunesse semi-dry wines have a distinct consumer appeal)

Israeli politics / Gaza war have lead to people buying more to support Israel

Marketing to the Orthodox community

• Identify sects with stricter mevushal rules (e.g. - 101F vs 105F) and promote specific brands that meet those
• Print advertising big (English, Yiddish), many do not use as much internet, none on Sabbath, take in news via print
• Whatsapp #1 social media for Orthodox Jews (or Telegram)

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