business news in context, analysis with attitude

(Okay, that was a cheap shot, and not entirely fair. But we were looking for a rhyme and that was the best we could do…)

Responding to a California state appellate court decision saying that, indeed, wine bottles using the word “Napa” on the label actually have to contain wine made from grapes grown in the Napa Valley, the Bronco Wine Co. announced that it will follow the court’s direction – and that its new Napa Creek wine will cost just $3.99 a bottle and be sold at Trader Joe’s.

Two-Buck Chuck was a wine industry phenomenon, an enormous success that Trader Joe’s found almost impossible to keep in stock – and Bronco clearly is hoping that lightning strikes twice.

In many ways, the new wine seems to be a way for Bronco to exact a bit of revenge against more mainstream wine interests that opposed it in court. Bronco has been marketing three brands with Napa Valley geographic names with non-Napa grapes, and more traditional Napa-based companies wanted to preserve the cachet and integrity that they felt was associated with their geographic location.

Bronco spokesman Harvey Posert said that the low-priced line “certainly sends a message that good Napa Valley wine can be produced and sold for a low price.”
KC's View:
We supported the court decision, because we think to call a wine “Napa” but have the grapes come from somewhere else is, essentially, a lie.

But we also think that this is a terrific move by Bronco that will only serve to expand the number of people who enjoy wine, which is a good thing for the industry. The fact is that there often are vast differences between wines that cost four dollars, eight dollars, twelve dollars, and one up the scale. Some wines and overpriced, and some are bargains. You learn by trying…by experimenting…and by learning to enjoy some from every category.

And by the way, our headline notwithstanding…Two-Buck Chuck was never swill. Wasn’t our favorite by a long shot, but it was a perfectly acceptable wine – sort of in the same way that your first car was perfectly acceptable, but hardly what you’d want to be driving for the rest of your life.

Ironically, ACNielsen has released a study suggesting that Bronco may be coming at the business from the wrong angle – that the best selling wines in the US are the ones selling for $11 or more, with this category seeing a 19 percent increase in sales over the past year. Wines costing between $7 and $11 are up six percent in sales, while under $7 wines are up just 1.4 percent. We’re also drinking more imported wine, especially from Australia, and that tends to cost more.

Let’s see who gets the last laugh on this one.

We actually hope everyone is smiling – all the way to the bank.