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Napa-based Hess Family Wine Estates has been revamping its operations recently with a focus on premium and luxury wines. As part of the push, Hess named fifth-generation family member Tim Persson as president and CEO, and has added a number of veteran wine executives, including John Grant (COO), Nicole Carter (CMO) and most recently Matthew Wood (VP, operations), all three formerly of Treasury Wine Estates. SND senior editor Daniel Marsteller met with Grant and Carter to get an update on progress.
SND: What is Hess Family’s total production currently, and which wines are faring best in the market?
Grant: We’re at about 780,000 cases total, but I would stress that it’s less about size and more about shape. We’re focusing the business as a premium and luxury wine player. There’s no doubt we’re getting momentum restored. Year-to-date we’re up a little over 12%. The epicenter of our business is $10-$20, where the Hess Select and Artezin offerings reside, and that’s up about 10% over the past 52 weeks. More exciting to us is that we’re up 51% in the above-$20 category. That’s by design, and we’re getting good traction in that high-growth area. Hess Collection Allomi, our Napa Valley Cabernet Sauvignon, is now over 50,000 cases, and it’s up 65%. Also, our Hess Collection Napa Valley Chardonnay is getting more focus. It too is starting to respond, up around 10% and accelerating.
SND: What new initiatives are in order for the Hess Collection?
Carter: We’re about to re-release The Lion, our icon Cabernet, which has been out of production since 2008. We’ve recrafted the wine and it will launch in September. Consumers have a lot of choices in Napa Cabernet at around $170, so the quality had better be there, and this will be the best Cabernet we can make. The Lion will be paired with a new Chardonnay from our Su’skol Vineyard called The Lioness, which we’ll release in April of 2017 at around $50. Hess Chardonnays tend to be highly aromatic and less oaky, but The Lioness will be a fuller style. If you look at Rombauer, for example—$35-$40 Chardonnay at 100,000 cases—there’s a drinker out there who likes that wine, and we haven’t been talking to them
Grant: We’ll produce 500 to 1,000 cases each of The Lion and The Lioness, creating a luxury halo. This September we’ll also release a new luxury red blend called The Lion Tamer ($40).
Carter: Red blends lend themselves to being edgier, and The Lion Tamer will push that theme a bit in its packaging and flavor profile, and bring some new consumers into the Hess brand. It will be rooted in Malbec, Cabernet, Syrah and other Napa varieties.
SND: What developments are you monitoring in the wholesale and retail tiers?
Grant: In retail, the chains are growing all over the country, so we’ve introduced a team of chain specialists. I was in Massachusetts recently, and all the talk is about how the number of licenses permitted has expanded from five to seven and in four years it will go to nine. If you can have nine stores across a state the size of Massachusetts you’ll have a significant footprint. All the major chains are moving in. Previously we didn’t have the muscle or capability to work with chains. Now we have a dedicated unit. Regarding distribution, whether by great management or by luck, we’ve found ourselves aligned with Breakthru, RNDC and Young’s. Given all the changes (at the middle tier), it’s important now as a medium-sized company that you pick a lane. And the lane we’re picking is the aforementioned trio.
Henri Bonneau, the iconoclastic vigneron whose wines defined the throwback style of Châteauneuf-du-Pape for a generation, died March 21 due to diabetes complications. He was 78. Bonneau was a singular presence in the town of Châteauneuf-du-Pape. Working from his tiny domaine, he nearly single-handedly produced wines with a distinctive force and presence that most vignerons in the appellation considered the paradigm for old-school Grenache. Wine Spectator has more on Bonneau’s life and work.
The craft beer movement delivered another year of stellar growth in 2015, with volume up 13% to 24.5 million barrels and retail value up 16% to $22.3 billion, according to the Brewers Association. Craft’s steady double-digit progress—amid a stagnant mainstream beer category—allowed its volume share to rise to 12% last year, with its slice of the value pie reaching 21%.
Meanwhile, new craft entrants continue to flood to market. The number of breweries operating in the U.S. rose 15% to 4,269 last year. Virginia, North Carolina, Florida and Texas were among the hotspots, with each of those states registering a net increase of more than 20 breweries.
•Total Wine & More is planning to open its second Bay Area store in Pleasanton, California. The Contra Costa Times reports that Total Wine has lodged an application for a 21,000-square-foot space that currently houses an Office Depot, which will be closing April 23. The Pleasanton outlet will mark Total Wine’s second Bay Area outpost, joining its recently opened Fremont location.
•Ste. Michelle Wine Estates is launching a new on-premise-focused wine label, Drumheller, which is rolling out nationally this month. Sourced from Washington’s Columbia Valley, Drumheller’s lineup includes Cabernet Sauvignon, Merlot and Chardonnay. Ste. Michelle portfoliomate 14 Hands, an Impact “Hot Brand,” also began as an on-premise-geared wine before exploding at retail in recent years, reaching 1.85 million cases in 2015, according to Impact Databank.
•Bend, Oregon’s Deschutes Brewery will open a new location on the East Coast in Roanoke, Virginia. The new facility—which joins Deschutes’ Bend brewhouse and production facility and Portland public house—will produce about 150,000 barrels initially, with the ability to scale up as needed. Construction will begin in 2019, with the first shipments of beers produced in Roanoke expected in about five years. Deschutes’ current footprint spans 28 states and the District of Columbia. The company’s lineup includes Fresh Squeezed IPA, Black Butte Porter and Mirror Pond Pale Ale.
•Crested Butte, Colorado-based Montanya Distillers has expanded into seven additional markets, bringing its total footprint to 44 states. The craft player, whose business is up 35% year-over-year, is now aligned with VOS Selections in New York and New Jersey, Aleksey Imports in Tennessee, BevMark in Montana, Northwest Vintage in Wyoming and Cask and Cork in North Dakota and South Dakota. Montanya also recently received a refreshed branding and launched a limited release Exclusiva rum, aged for a total of 36 months in ex-whiskey, Cabernet Sauvignon and Port casks. Montanya’s core lineup includes Platino Light rum and Oro Dark rum.
•Gin Lane 1751, a new London Dry gin brand, is rolling out to a handful of U.S. markets in May. Created at London’s Thames Distillery by Charles Maxwell of Thames Distillers and The Bloomsbury Club gin group, the brand includes London Dry Gin, Victoria Pink Gin and Old Tom Gin (all 40% abv and $24.99 a 750-ml.). Gin Lane 1751 is available in Delaware, Maryland and Washington D.C. through Bacchus Importers; Georgia through Prime Wine & Spirits; and Massachusetts, New York and Rhode Island through M.S. Walker.
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