FD: Wine Column February 25, 2009

Marketing in economic slump important for tourist-oriented wine industry

There’s only one way out of this economic slump and that’s to keep money in circulation.
Why not spend some at your local winery?

That’s not entirely frivolous. Many Colorado wineries appear to be holding the line on business in spite of a general financial malaise settling like a fog across the economy.

A bountiful harvest last fall, several notable wins at national wine competitions and a hangover (of the right sort) from a busy summer have kept the momentum going for the state’s winemakers.

“A lot of people, especially in Paonia, Palisade and Cortez, had really good summers,” said Doug Caskey, executive director of the Colorado Wine Industry Development Board. “And talking recently to some wineries, I was told some of them had better Januaries than they’ve ever had. In some cases, it even out-stripped December, which is unheard of.”

Caskey knows that January can be awfully slow, even in the best of years, at most wineries. Many of them are located in rural areas (because, to paraphrase bank robber Willie Sutton, “that’s where the grapes are”), where tourism drops off the map in the off-season.

Plus, a fear of recession has some wineries, along with many, many other businesses, cutting back in their marketing budgets, a move Caskey says might be the wrong one for a tourist-oriented business.

“Marketing is even more important when you’re dealing with a transient customer base,” he said. “You have to make sure you have a way for people to find you.”

To that end, Caskey recently sent an e-mail to the state’s wineries with an article from the New York Wine and Grape Foundation.

The article, referring to a study by A.C. Neilsen Co., said companies that cutback their marketing during the 1980s recession saw a 19 percent increase in business five years later while companies that retained or built their marketing during the recession grew 275 percent.

Grand Valley and Delta county wineries will benefit from the growing national trend toward shorter, closer-to-home vacations. People will do just about anything to save money but that doesn’t include giving up their vacations, no matter how short or how close to home.

“That’s what we’re seeing and hearing everywhere we go,” said Barb Bowman, division manager at the Grand Junction Visitor and Convention Bureau. “Nationally, people are staying closer to home, within the state or region for shorter vacations.”

Perhaps that’s one reason the April 17–19 wine train from Denver, marketed by the American Automobile Association, already is sold out.

Two other wine trains next fall also are close to selling out, Bowman said.

A recent tourism trade show in Albuquerque had people looking for small, more-affordable destinations, Bowman said.

“We’re cautiously optimistic,” she said.

One way to attract more sales is to win awards for your wine. Wine bling not only looks good on your resume and hanging from your tasting room bottles, it plays a big role in what people purchase.

Colorado wines continue to win medals, but what’s really important is the medals are coming at better competitions. It’s one thing to win some recognition at the county fair level and something entirely different to be recognized against better-known peers.

Recently, Two Rivers Winery was awarded three gold medals at the 2008 World Wine Championships sponsored by the Beverage Testing Institute in Chicago.

The wines included a 2007 Syrah, 2007 Merlot and 2006 Vintner’s Blend, with the latter two being named “Best Red Wines.”

Those are the latest additions to a long list of awards collected by Colorado wines at last year’s competitions. From the Toast of Taos to the Indy International, Colorado winemakers last year won bling and recognition for their efforts.

It’s Marketing 101, and that’s a good thing.

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