What’s New in Wine & Spirits
EXPENSIVE WINE INCREASES CONSUMERS’ ENJOYMENT
Researchers at the California Institute of Technology found that pricier wine increases a person’s enjoyment of the wine. Antonio Rangel, associate professor of economics, led a research team to test how marketing shapes consumers’ perceptions, according to an AP article in Theage.com. The findings come to us during an interesting period when trading up is at an all time high.
The volunteers were told the price of the wine, or so they thought. The researchers served two of the wines twice, once with the true price and another time with a fake price. By monitoring the volunteers’ brain, the study found that inflating the price of a bottle of wine enhanced a person's experience of drinking it, as shown by the neural activity. Volunteers consistently gave higher ratings to more expensively labeled wines. We don’t find these results surprising, especially given the fact that consumers are drinking more expensive alcohol than in years past.
RETAILERS HEADED FOR MORE DISASTER
The retail environment might not get any better in 2008 says a report in Reuters. Consultants at the annual National Retail Federation convention posed negative outlooks for the U.S. retail industry, which has already suffered at the hands of higher gas and food prices, a credit crunch and a prolonged housing market decline.
Consumers are “watching what they spend on everything," said Wendy Liebmann, chief executive of WSL Strategic Retail.
Most shoppers are making fewer weekly shopping trips and spending “significantly” less on discretionary items such as home appliances and decor, fashion accessories, electronics, perfume, computers and software. Could that include alcoholic beverages?
The big retail losers include mass merchants like Wal-Mart and Target. However, they can make up for their losses by focusing on emerging markets like Eastern Europe and Asia. Other trends to watch out for in 2008? Retailers are expected to increase their focus on added services, such as Best Buy’s Geek Squad, social responsibility, improving customers' shopping experiences and retailers aggressively improving their marketing messages
PARIS CHEAPENS THE PROSECCO NAME
Paris Hilton has not managed to win over Italian winemakers who are scrambling to do damage control. Prosecco producers are unhappy with Hilton’s provocative ads for Rich Prosecco, a canned sparkling wine owned by an Austrian company.
"Hilton hotels are a sign of quality; Paris Hilton is not," said Fulvio Brunetta, president of the wine growers association of Treviso, the northern Italian city in the Veneto region where Prosecco is made.
The Italians have beef with the ex-con’s lifestyle and image, along with her recent DUI charge and jail time. They’re afraid Rich Prosecco’s advertising will cheapen the Prosecco name. As a result, the wine growers association of Treviso is meeting next week to decide on ways to protect the Prosecco name and to ensure that companies using the name are sourcing their wine from the Treviso area.
Rich Prosecco says it hasn’t done anything wrong because it sources its wine from the Treviso area. In fact, Rich Prosecco’s two fruit varieties are not labeled Prosecco, which is in accordance with European wine laws.
"It's as if someone from Champagne would oppose us selling champagne cans with Kate Moss for example. It's just marketing and Paris Hilton is the most famous girl in the world," Rich Prosecco Chief Executive and owner Gunther Aloys, as quoted in Reuters.
Hopefully for Paris Rich Prosecco won’t drop her ads. As you’ll recall, the former heiress’ grandfather, Barron Hilton, said he would donate 97% of his $2.3 billion fortune to charity.
WSD BRIEFS:
NEW VINE LOGISTICS is launching an eco-friendly packaging solution to keep wine at an optimal temperature during shipment. WineAssure reportedly guarantees that wine does not exceed 70 degrees Fahrenheit or fall below refrigeration level over a five day shipping period, regardless of exterior temperatures. The packaging and insulation are made from 100% recyclable and degradable materials. The two-bottle packages will be available March 1 for $15.
DIAGEO declined the most in over five years in London trading Friday thanks to speculation that the company might miss analysts’ profit estimates for its first half, according to a Bloomberg report. The distiller's shares fell as much as 2.9%. Earlier last week CFO Nick Rose stuck with his forecast for 9% profit growth despite the fact that consumer spending has slowed in the U.S. and Europe.
WAL-MART will directly compete with Tesco’s Fresh & Easy concept with a new small-format grocery store titled, “Marketside.” The new stores will roll out in Arizona this year. They are about 20,000 sq ft, a 10th of the size of the Supercenters, and will be housed in old drug stores. The company has applied for wine and beer licences for stores in the cities of Gilbert, Tempe and Mesa, and has additional leases in the city of Chandler, according to the Financial Times.
CALIFORNIA LAWMAKERS are reportedly still considering a “sin tax,” which would increase taxes on distilled spirits in California. As you’ll recall, the Marin Institute issued a press release last week recommending that Gov. Schwarzenegger and state legislators raise taxes on wine, beer and distilled spirits to help reduce the state's $14 billion budget shortfall.
CRUZ DEL SOL TEQUILA finalized a partnership with Republic National Distributing Co. (RNDC) to distribute Cruz Tequila, the company said today.
MCGUIGAN SIMEON might change its name to Australian Vintage Limited. A proposal to its shareholders will be voted on later this month. If the name is approved, McGuigan’s symbol will change on the Australian Securities Exchange from MGW to AVG.
STOLICHNAYA has announced the addition of two new size offerings for its ultra-luxury vodka, Stoli elit. As of November 2007, Stoli elit is available in a 1.75L ($129.99) and 50ml trial size ($8.99), in addition to the 750ml and 1.0L sizes currently available.
LOUIS LATOUR has bought Beaujolais producer Maison Henry Fessy for an undisclosed sum, reports Decanter.com.
Until tomorrow, Megan
“The greatest pleasure in life is doing what people say you cannot do.”
Walter Bagehot
--------- Sell Day Calendar ----------
Today's Sell Day: 9
Sell days this month: 22
Sell days this month last year: 22
This month ends on a: Thur
This month last year ended on a: Wed.
YTD sell days Over/Under: 0
Researchers at the California Institute of Technology found that pricier wine increases a person’s enjoyment of the wine. Antonio Rangel, associate professor of economics, led a research team to test how marketing shapes consumers’ perceptions, according to an AP article in Theage.com. The findings come to us during an interesting period when trading up is at an all time high.
The volunteers were told the price of the wine, or so they thought. The researchers served two of the wines twice, once with the true price and another time with a fake price. By monitoring the volunteers’ brain, the study found that inflating the price of a bottle of wine enhanced a person's experience of drinking it, as shown by the neural activity. Volunteers consistently gave higher ratings to more expensively labeled wines. We don’t find these results surprising, especially given the fact that consumers are drinking more expensive alcohol than in years past.
RETAILERS HEADED FOR MORE DISASTER
The retail environment might not get any better in 2008 says a report in Reuters. Consultants at the annual National Retail Federation convention posed negative outlooks for the U.S. retail industry, which has already suffered at the hands of higher gas and food prices, a credit crunch and a prolonged housing market decline.
Consumers are “watching what they spend on everything," said Wendy Liebmann, chief executive of WSL Strategic Retail.
Most shoppers are making fewer weekly shopping trips and spending “significantly” less on discretionary items such as home appliances and decor, fashion accessories, electronics, perfume, computers and software. Could that include alcoholic beverages?
The big retail losers include mass merchants like Wal-Mart and Target. However, they can make up for their losses by focusing on emerging markets like Eastern Europe and Asia. Other trends to watch out for in 2008? Retailers are expected to increase their focus on added services, such as Best Buy’s Geek Squad, social responsibility, improving customers' shopping experiences and retailers aggressively improving their marketing messages
PARIS CHEAPENS THE PROSECCO NAME
Paris Hilton has not managed to win over Italian winemakers who are scrambling to do damage control. Prosecco producers are unhappy with Hilton’s provocative ads for Rich Prosecco, a canned sparkling wine owned by an Austrian company.
"Hilton hotels are a sign of quality; Paris Hilton is not," said Fulvio Brunetta, president of the wine growers association of Treviso, the northern Italian city in the Veneto region where Prosecco is made.
The Italians have beef with the ex-con’s lifestyle and image, along with her recent DUI charge and jail time. They’re afraid Rich Prosecco’s advertising will cheapen the Prosecco name. As a result, the wine growers association of Treviso is meeting next week to decide on ways to protect the Prosecco name and to ensure that companies using the name are sourcing their wine from the Treviso area.
Rich Prosecco says it hasn’t done anything wrong because it sources its wine from the Treviso area. In fact, Rich Prosecco’s two fruit varieties are not labeled Prosecco, which is in accordance with European wine laws.
"It's as if someone from Champagne would oppose us selling champagne cans with Kate Moss for example. It's just marketing and Paris Hilton is the most famous girl in the world," Rich Prosecco Chief Executive and owner Gunther Aloys, as quoted in Reuters.
Hopefully for Paris Rich Prosecco won’t drop her ads. As you’ll recall, the former heiress’ grandfather, Barron Hilton, said he would donate 97% of his $2.3 billion fortune to charity.
WSD BRIEFS:
NEW VINE LOGISTICS is launching an eco-friendly packaging solution to keep wine at an optimal temperature during shipment. WineAssure reportedly guarantees that wine does not exceed 70 degrees Fahrenheit or fall below refrigeration level over a five day shipping period, regardless of exterior temperatures. The packaging and insulation are made from 100% recyclable and degradable materials. The two-bottle packages will be available March 1 for $15.
DIAGEO declined the most in over five years in London trading Friday thanks to speculation that the company might miss analysts’ profit estimates for its first half, according to a Bloomberg report. The distiller's shares fell as much as 2.9%. Earlier last week CFO Nick Rose stuck with his forecast for 9% profit growth despite the fact that consumer spending has slowed in the U.S. and Europe.
WAL-MART will directly compete with Tesco’s Fresh & Easy concept with a new small-format grocery store titled, “Marketside.” The new stores will roll out in Arizona this year. They are about 20,000 sq ft, a 10th of the size of the Supercenters, and will be housed in old drug stores. The company has applied for wine and beer licences for stores in the cities of Gilbert, Tempe and Mesa, and has additional leases in the city of Chandler, according to the Financial Times.
CALIFORNIA LAWMAKERS are reportedly still considering a “sin tax,” which would increase taxes on distilled spirits in California. As you’ll recall, the Marin Institute issued a press release last week recommending that Gov. Schwarzenegger and state legislators raise taxes on wine, beer and distilled spirits to help reduce the state's $14 billion budget shortfall.
CRUZ DEL SOL TEQUILA finalized a partnership with Republic National Distributing Co. (RNDC) to distribute Cruz Tequila, the company said today.
MCGUIGAN SIMEON might change its name to Australian Vintage Limited. A proposal to its shareholders will be voted on later this month. If the name is approved, McGuigan’s symbol will change on the Australian Securities Exchange from MGW to AVG.
STOLICHNAYA has announced the addition of two new size offerings for its ultra-luxury vodka, Stoli elit. As of November 2007, Stoli elit is available in a 1.75L ($129.99) and 50ml trial size ($8.99), in addition to the 750ml and 1.0L sizes currently available.
LOUIS LATOUR has bought Beaujolais producer Maison Henry Fessy for an undisclosed sum, reports Decanter.com.
Until tomorrow, Megan
“The greatest pleasure in life is doing what people say you cannot do.”
Walter Bagehot
--------- Sell Day Calendar ----------
Today's Sell Day: 9
Sell days this month: 22
Sell days this month last year: 22
This month ends on a: Thur
This month last year ended on a: Wed.
YTD sell days Over/Under: 0
posted at 12:02 PM
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