Reluctant Marketer: My history of selling wine at Linden Vineyards 1988 to present
by Jim Law
I am a winegrower. I spend most of the growing season in the vines and a good deal of the fall and winter in the cellar. I love it. This is what attracted me to the business 25 years ago. Once I started my own operation, it became apparent that I would have to be spending a significant amount of my time selling wine. My goal then remains my goal today: to spend as little time as possible on the marketing end of the business. It’s not so much that I don’t like to sell wine, it’s that marketing takes me away from what I love best. Ironically this situation has contributed to the financial success of Linden. By putting a minimum amount of resources into sales, marketing and promotion, the wine we do sell is at a high profit margin. These profits are funneled back into the vineyard and cellar. The greatest part of our wine is sold in our tasting room (cellar door). Any wine sold through our distributor I consider as a marketing expense rather than a profitable sale. This is the reality of small wineries and the three-tier system.
Seeing so many new wineries starting up, and going through the same growing pains Linden went through, I thought I would write about Linden’s marketing evolution. I usually find marketing articles to be incredibly vague, patronizing and sometimes condescending. For this reason I’ve decided to take the reader through my personal, nuts and bolts saga.
Phase 1: Scared to Death: (1988 to the early 1990’s).
My early business life centered around cash flow. It’s hard to be a visionary when you are constantly worried about how you are going to pay the bills. The marketing reflected this. I call it shotgun marketing. Sell bottles to anyone, anywhere, anyhow. Festivals, winery events, store tastings, dinners. I get exhausted just thinking about it. The vineyard was occasionally neglected; just not enough time. Wine style became dictated by market trends rather than vision or terroir expression.
Marketing consisted of attracting bodies into our tasting room, which was and is still located several miles down a narrow, windy mountain road. There was a certain comfort level associated with lots of people in the tasting room. We knocked ourselves out giving tours on demand and lengthy tastings to sell one bottle of wine.
The first year in business we sold out all of our wine. This made me feel good, and encouraged me to start an aggressive planting program in addition to leasing some local vineyards. This is also what lead to a massive cash flow problem that took me years to dig out of. I’m still paying back the loans. This is a scenario that I see repeated regularly by new wineries: The first year is the ‘honeymoon’. You are the new kid on the block, and retailers and wine enthusiasts want to check you out. That tiny first year’s production sells out fast. Customers are begging for more wine. You plant more grapes, buy more grapes, more tanks, barrels, bottles, corks. When the new and greatly increased inventory is ready to sell, it no longer seems to fly off the shelf. There is another new kid on the block. But in fact, the wine is selling just like the previous year. Selling 3,000 cases is different than selling 800. The monthly payments to the bank continue to make festivals and winery events very attractive. The candle is burning at both ends.
My epiphany came one Labor Day weekend in the early to mid nineties. I had just reviewed my accountant’s report showing marketing costs per bottle greatly exceeding production costs. That Sunday we had one of our Jazz Concerts at the vineyard. It rained. The musicians set up in the cellar. The winery was packed with people having a good time. The musicians decided that Jimi Hendrix fit into our agreed upon classical jazz format. What had I created? Was this why I got into this business? What business was I in?
Phase 2: Smart growth and the courage to do nothing: (early 1990’s to late 1990’s).
Profitability overtakes cash flow. I re-examined everything we were doing. Targeting the ‘right’ customer becomes the focus. I decided that the wine had to be the sole profit center. Everything else was eliminated. Linden’s profit margins soared. It soon became apparent that most of the events had been money losers, especially when staffing costs were correctly allocated. We did continue to do some limited events, but they were only focused around wine education. I was relieved to get out of the gift shop business, which it turned out was marginally profitable, again once staff time was correctly factored in. We all became less stressed and more relaxed with customers. Wine sales increased. Linden was about wine and was attractive to customers who were interested in wine. Bored people looking for entertainment during a day out in the country went elsewhere.
Our marketing efforts had shifted from getting people in the door to giving them good, knowledgeable, professional service while they are here. I have a great staff who has been with Linden for a long time. I attribute much of this to the low stress environment that has been created by eliminating superfluous events and reducing the group/party traffic in the tasting room. Selling wine is about relationships. Customers don’t form relationships with burnt out, overwhelmed people behind the tasting counter.
Phase 3: Jamais content [never content] (2000 to present).
I stopped working for the business and the business started working for me. My desire is to make great wine. This takes an enormous amount of capital and the luxury of creative time. I have had the opportunity to travel to many of the great wine producing regions and have realized that we in the East have an amazing marketing advantage. We live in our market, know it intimately, and have a loyal, ‘patriotic’ clientele. I am taking the ‘easy money’ of direct sales and investing it in my vineyards. Viticulturally we have certain disadvantages in comparison with the rest of the world. These disadvantages can be over come by smart management and lots of expensive labor. As a result the wines get better and even easier to sell.
I have learned to stay in touch with my best customers through occasional notes and letters. I’m still of the option that Email doesn’t dovetail with the small upscale feel of Linden. We have many great restaurants, inns, and bed and breakfasts in this area that are increasingly catering to ‘gourmet tourists’. I am making more of an effort to stay in touch with these operations. Linden has dropped out of the competition circuit. I’ve never been comfortable talking about medals or using them to sell wine. My goal is to produce unusual wines with character and terroir expression. These wines are better appreciated by wine writers than competition judgings.
I have also started an extensive commercial library of past vintages. I am finding that our wines are aging gracefully. We do special ‘reserve tastings’ and like to feature some of the older wines to prove the point.
Finally, I am slowly recognizing which wines are becoming our ‘signature wines’. The Basskin and Robbins approach (31 flavors offered) is slowly being phased out. This requires removing vineyards, which is emotionally difficult, but I feel it is now time to force change if I am to continue to progress.
None of these changes could be possible if it wasn’t for an inquisitive, knowledgeable public. I am constantly amazed at the increasing sophistication of our customers. New customers usually come to Linden with a recommendation from a trusted, respected source. The building and grounds are tasteful, clean and well cared for. The staff is intelligent, professional, and low key. The wines are good. There is no hype, special deals, or promotions. They have made a discovery. Linden is their winery.
Like most small business people, we spend an enormous amount of time working. It usually defines who we are. If we love our work, chances are quite good that the business will succeed. This is why I feel that it is important to tailor the business around the personality of the people running it. People change, and often the business needs to do the same. This is why I reserve the quiet winter months as a time of review, reflection and direction.