Monday, January 5, 2015

Revisiting Last Year's Predictions (And Another Best Of List)

Years past have welcomed the new year with a list of predictions, and a few predictions were part of last week's Year In Review.  But how'd last year's predictions pan out?  Fellow blogger and good guy, Jeff Siegel (aka The Wine Curmudgeon) prompted this question in the prelude to his annual $10 Wine Hall Of Fame piece.  In it he flatteringly quotes one of my predictions for 2014, that "...a dollar will buy you less in 2014 than it did in 2013."  Jeff's Hall of Fame is always worth reading - he's got an uncompromising standard and a strong belief that good, interesting wine needn't be expensive.  I'm definitely down with that.  Plus, he's turned me on to a number of terrific values, including one that made it onto the Best Wines of 2014 list, the Rene Barbier Mediterranean Red.

The Wine Curmudgeon's comments also hint at the cyclical nature of the supply side of this business.  There will always be consolidation followed by divestiture, rising prices will always follow  accolades, and the atrophy of dying brands will always coincide with the welcoming of new producers (especially at the value end of the price spectrum).  And you can pretty much count on different, if not all, components of that cycle happening every year.

With that as a backdrop, let's look at those predictions from last year.  One final note of interest - these predictions carried with them a disclosure I'd like to repeat, "...if history is any indicator of future performance, it'll be 2016 before any of these really materialize as nothing ever happens as quickly as you think."
  1. Online wine sales will explode thanks to Amazon swaggering into the game and a three tier system that refuses to acknowledge changing consumer behavior.  Amazon has penetrated a number of states - 13 at last count - but not nearly as many as I would have thought by now.  Ironically, they no doubt have the strength of the three tier system to thank for that.
  2. Moscato drinkers will be dazzled by something else the same way as Moscato distracted them from Pinot Grigio.  And chances are the new, short-lived fad will be fueled by a reality TV celebrity doing something obnoxious with a bottle in hand.  Who knows, it could even be Riesling's lucky year.  
  3. Hipsters will finally let go of Riesling and find something else to geek out over.  Mencia, you could be their new sweetheart.  Honestly, I'm so un-cool anymore, I couldn't tell you what's trending in the hipster market this year.
  4. Countries like Albania, Croatia, Bulgaria, and Greece will emerge from the shadows and onto the mainstream as respected producers of value-priced (and some serious) wine. Greece has been getting some very nice - and apparently deserved - attention.  The affable and highly-regarded Mike Madrigale's number one wine by the glass is Greek.  Those other countries?  Maybe next year.
  5. The craft beer Renaissance will take a big bite out of wine's sales growth, attracting far more new drinkers to its ranks by a wide, wide margin. I'm certain I got this right.  Not only that, but I'd double down on this bet for this year thanks to #6 and a continued insistence on maintaining an elitist posture by many in the retail layer of this industry.
  6. Despite #5, overall wine prices will continue to outpace inflation and wages, also by a wide margin.  Yup.  Want proof?  Think of any wine you fell in love with 5 years ago.  What is the percentage price increase then versus today?  See?
  7. There will be more consolidation in the expensive Napa industry as under-capitalization continues to unwind.  In other words, larger holding companies will continue to enjoy picking up over-leveraged wineries at pennies on the dollar.  Prices will remain stubborn, however.  Hard to say how much consolidation happened in 2014.  My guess is that companies have learned that keeping acquisitions quiet can help preserve brand equity and exclusivity.  But the prices?  They've held fast, only entrenching the inevitable collapse of this house of cards.
  8. China will continue to prop-up pricing in first and second growth Bordeaux.  Or what they believe to be first and second growth Bordeaux.  True.  What'll be really interesting (and indicative of Chinese consumer savviness) is if this remains true as the lackluster 2011 vintage comes to market.
  9. Not unrelated to #8, there will be more scandals over counterfeit wines at auction houses.  Just ask billionaire William Koch.
  10. An aging Robert Parker will acknowledge that wine scoring is as much subjective as it is objective, causing celebration among sommeliers and anger among wine critics who have adopted his 100 point scoring system.  The popularity of the 100 point scoring system, however, will not suffer.  Well, there's still time...

No comments:

Post a Comment

Please add your comment here: