LinkedIn Post 1: The Drivers of Modern Wine Industry

Those active on LinkedIN may know that the professional networking site has just launched an article/blog publishing platform for some of its millions of users. The idea is to allow the members to make the most of targeted reach to fellow professionals and industry watchers.

As an active user of LinkedIN, I wanted to take advantage of this new feature and share my thoughts about a very interesting subject which I’ve been contemplating writing about (actually for this site, as I’ve been doing since 2008). So, I did end up writing on LI’s publisher and as expected, the response has been good. I am reproducing it here for the benefit of readers of this site. (See original)

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The wine industry and its functioning as we know today – dynamic and extremely progressive, is a far cry from a confined and traditional affair about two decades ago. While globalization has played a vital role, increased consumer awareness and a corresponding demand for more refined products and services, is at the crux of this dramatic transformation within a relatively short period of time. This demand, in turn, has given rise to various organisations and ideas which have helped shape up the contemporary trade and enhance its global appeal. In fact, wine’s rising popularity around the globe, especially in the last decade, wouldn’t have been possible without these innovative brands and smart individuals behind them. In a sense they represent the building blocks of the modern wine world.

Wine’s fascinating turnaround story is often measured by its commercial success worldwide, which is reflective in the stories we mostly come across in the media – like this recent one about most powerful wine brands. But in spite of economics being the ultimate yardstick of wine’s increasing footprint, the industry owes a great deal to the actual drivers of the contemporary business. The list below mentions the most notable of these brands, with an international presence and irrespective of their commercial prowess.
1.) Technology: Most of these are young companies which followed the start-up route during the wine boom of the late nineties and the first decade of this century. They have not only acted as vital connectors of information highways of the wine world but also simplified the way we gather information.

• CellarTracker: Those who use/follow CT swear by it, and why wouldn’t they? A one of its kind cellar management tool, it is the largest and most credible platform for serious wine lovers with an enviable database of tasting notes, wine reviews and recommendations. Eric LeVine‘s gift to the wine world is an invaluable one and will remain so for a long time to come.

• Wine-Searcher.com: If there is one organization which has brought transparency and accountability to the online wine trade, it undoubtedly has to be Wine- Searcher.com. Since its inception in 1999 in London (later moved to New Zealand), the company has gone through a dramatic transformation – both as a wine search engine, which remains its USP, and in its latest avatar as a wine news and information site. I had the good fortune of being a part of Wine-Searcher’s wine team and witness its raw ability to empower the wine consumer. Its strength lies in the amount of data it has accumulated over the years, and more importantly the ingenious way the data is integrated to fuel its search engine software.

• Social & professional networking sites: With the advent of web 2.0 and the corresponding rise of social media, it seems there is no limit to how much wine information is now available online, most of which is dynamic and real time. Today’s vibrant wine ecosystem is unimaginable without Facebook Likes & shares, Twitter’s witty one liners, LinkedIn’s professional inputs or Instagram’s creative photo sharing.

• Apps, apps & more apps (more the merrier!): With the increase of tech-savvy wine consumers, social media engagement and usage of mobile devices, it is but natural that so many mobile apps have flooded the market of late. They offer a host of features, ranging from label scanning for tasting notes and ratings, to those which let you sift through restaurant wine lists remotely, plus many many more.

2.) R&D, education & training: This sector of the industry is probably the most vital considering the scope and opportunities of spreading knowledge and information, particularly in young and upcoming wine cultures. A case in point is this short video about China’s rise as a major wine market (note that education is the most common keyword here).

• WSET: The Wine & Spirits Education Trust is at the forefront of wine education in the world. Whether it is basic wine knowledge or specialist qualifications, WSET’s contribution in spreading awareness about wine remains unparalleled.

• Court of Master Sommeliers: The hospitality industry provides a major source of wine consumption and enjoyment around the world and therefore it is of utmost importance that a trained manpower is available to fulfill this requirement. CMS offers major industry-recognized sommelier certifications, including the holy grail that is Master Sommelier.

• Other wine education providers: While there are many institutes around the world offering wide ranging courses; from wine production to marketing, there are some which have carved a niche for themselves. The likes of Roseworthy (University of Adelaide) and UC Davis stand out for their quality of wine production courses, whereas BEM Bordeaux has emerged as a chosen destination for business related studies.

• AWRI: A pioneer in R&D field, the Australian Wine Research Institute’s repertoire of ground-breaking research, especially in wine production, has helped producers around the world to overcome many challenges in the vineyard and winery, resulting in creation of more refined products. Whether it is advanced vineyard management, improving vine health, clonal research, sustainability innovations, simplifying wine microbiology, demystifying wine ageing, important studies on wine closures or valuable research on market behavior and consumer preferences, this organization’s list of research work has made it indispensable to the wine industry.

Then there are organizations like Wine Intelligence and IWSR (International Wine & Spirit Research) who excel in keeping track of market sentiments through specialized studies which include a range of market insights, trends and consumer behaviors, among others.

3.) The marketplace:With rapidly changing business dynamics and fierce competition among brands to capture new markets, there has been a revolution of sorts in how wine is sold today. While brick and mortar outlets still exist, their monopoly has steadily declined and replaced by numerous other ways consumers are able to source wine today.

• Liv-Ex: Although not a place where you can directly buy wine, it makes to this list solely on the basis of the unique proposition it brings to the fine wine market. It is like the wine world’s stock market, where wines are traded online and over phone and valued against Liv-Ex’s large data of historical and current wine prices. Those with a stake in the fine wine market or wish to have their fingers on the pulse of the market, consider it as an invaluable resource.

• Online wine stores: Wine e-commerce is big business today and with technology playing a big role in the promotion of the beverage, it is hardly surprising that they have mushroomed all over the world and catering to a big chunk of the market.

• Futures market: Buying/selling wines as futures is not a new phenomenon but in today’s wine economy it has gained added significance owing to a renewed focus on premium wines and a healthy perception of them being good source of alternative investment. No wonder, the futures/en primeur market is seen as a barometer of a country’s fine wine potential.

• Auction market: Those who followed the wine boom of the last five years which unfolded in the east, especially in Hong Kong, Singapore and mainland China, realize the importance of the auction market in generating a wave of interest and passion about the beverage. One may argue that this form of trading is super niche and hence has limited reach but the buzz which accompanies fine wine auctions is enough to make this form of trading a significant player in today’s wine economy.

4.) Critics, writers and domain experts: The contemporary wine world owes a lot to these individuals for spreading their wisdom and knowledge about wines and who positively influence our thoughts/opinions about the beverage. Whether it is an acclaimed writer, a prolific blogger or a mass-followed taster and critic, they have deep understanding about the subject and the dynamics of our industry. Thanks to their efforts, coupled with opening of new channels of communication, wine’s appreciation is on a steady rise worldwide. (The list of such personalities is too long to be included here).

5.) Sommeliers: The new breed of sommeliers are not just traditional wine servers – they are the new-age ambassadors of wine wielding enormous clout in the trade, a reason the hospitality industry lays a lot of emphasis in hiring top sommeliers to run their wine programs.

6.) The wine media: Last but not the least, how can our vinous thirst be quenched without the regular supply of news, views and analysis about virtually everything happening around the wine world? In spite of alternative sources of information (read social media) making inroads in the wine ecosystem, a vibrant mainstream wine media is still, and will remain, the primary source information.

Cheers,

Niladri

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The curious case of India & China’s love for wine

Wine has largely been a Western indulgence until the turn of this century, when, the rise of China and India, in addition to other Eastern economies, signaled a new happy hunting ground for the beautiful beverage. What are the factors that dictate wine’s stellar rise in popularity in this part of the world? Most importantly, is this emergence of a new ‘New World’ and sign of things to come in the world wine scene?

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In its long recorded history, the wine world has witnessed many defining eras which shaped up its cultural contours and market dynamics. The last two centuries have been particularly important in wine’s overall evolution. While the 19th century was marked by the advent of a much imitated classification system, spread of Vinifera vines outside Europe and the Phylloxera epidemic, the 20th century was shaped up by the great depression, emergence of the New World, rise and influence of the wine critic/writer and globalization of the beverage.

In recent times, and majority of the 21st century, three significant factors have influenced the wine market – the rise of the East as a major wine destination, preponderance of technology and social media in wine promotion and the global financial meltdown of 2008/09. While the latter was thankfully short-lived, and social media’s influence today spreads across every sphere of human lives, wine’s popularity in non-traditional wine drinking countries, especially in Asia, is somewhat intriguing and arouses curiosity.

Unlike their counterparts in Europe where wine has been an intrinsic part of the culture since time immemorial, the East’s (and especially its two behemoths, China and India) affection for the beverage is rather new-found and recent. With a few exceptions, quality wine-drinking in Asia does not even go back a decade. But one look at the popularity and growth trends, in addition to immense stature wine now enjoys in this part of the world, suggest that the East has definitely arrived on the wine scene.

So what explains this rise in popularity in such a short period of time, in what was once considered an ignorant market for wine?

To begin with, it is well-established and well-documented that Economic growth is in the core of China and India’s thirst for wine. But are there other associated and independent factors which have contributed to this new-found admiration for the beverage? Let’s explore:

# Demography >>> Rapid economic advancement and wealth generation in China and India has created a demography with high disposable incomes, mostly spent on the pleasures of life. This mostly comprises of an aspirational middle class and an outward-looking young generation – well-informed, well-traveled and cosmopolitan, who are as comfortable being global citizens as Indians or Chinese. Wine drinking may not come naturally to them but this section of the society  certainly fosters the desire to learn and adapt to new ways of life, a reason more and more young people are changing their drinking habits and switching to wine from other beverages.

# New paradigms of wine and food pairing – old clichés are dead >>> One of the most significant developments of this era has been the debunking of many stereotypical food & pairing specifications, which has helped in promoting wines in countries where the local cuisines were earlier thought unfit for marrying with wine. Whether it is the lighter style of Pan-Asian food and its more complex variants involving redolent herbs and condiments, or the exotic aromas of Indian spices, wine’s compatibility with Asian cuisines are being defined anew and with renewed gusto.

On one hand, the proponents of ‘aromatic wines only for Asian food’ theory are having a re-look at their food & wine pairing approach, on the other, the hospitality industry is acting as the catalyst for this reform. One has to flip through the wine lists of luxury hotels and engage with professional sommeliers to realize the revolutionary changes that have taken place in the overall mindset of drinking a vast array of wine styles with local food.

Decoding Indian cuisine by individual spices helps in food pairing decisions. GSM blends and Zinfandels are good matches with dishes rich in sweet Indian spices

Nowadays, it is commonplace to find wine lists which embrace and promote Zinfandels and Tempranillos with equal ease and confidence as the much favored Rieslings and Gewürztraminers.

# Accessibility to information and knowledge >>> Gone are the days when wine literature was confined to paperbacks and high-end, glossy magazines. Today there is hardly any information about wine which cannot be accessed online. Although a global phenomenon, Asians, especially in countries like India and China, have made knowledge gathering through internet a way of their lives. And quite understandably, this has resulted in a new-age way of wine learning, which in turn is aiding the spread of a healthy wine culture.

The demand for wine knowledge has also resulted in the birth of a thriving wine media, both online and print, which are acting as information hubs for the knowledge seeking folks.

# Quality training and education >>> During the last decade, the level of formal wine education and training for trade and general wine appreciation programs for the consumer have improved considerably. Education providers like the WSET have proliferated throughout the two countries, uplifting the overall awareness of wine. Additionally, there are many private organizations which offer regular wine sampling and food pairing courses to the urban wannabe enthusiasts. All these have contributed in the learning and promotion of wine.

Training and wine appreciation workshops are playing a vital role in creating a healthy wine culture

# Rapid urbanization >>> According to findings by McKinsey Global Institute in 2010, both China and India are experiencing unprecedented urbanization, resulting in noticeable churns in almost every sphere of life in these geographies. Wine, being a part of urban lifestyle, is probably one of the few highly desirable consumer products which has directly benefited from this social transformation.

# Rise of the Sommelier >>> The hospitality sector which propels the wine juggernaut in the two countries has taken a leaf out of their American and European counterparts in projecting the sommelier as a worthy wine ambassador. Today it is commonplace to find certified and professionally trained sommeliers in branded restaurants all over the region.

Armed with technical expertise and passion for the subject, these sommeliers (and other wine professionals) have become the de-facto wine evangelists capable of influencing wine drinking habits in their respective geographies. Many of them regularly appear in the media also to share the virtues of wine drinking and their overall enjoyment.

# Wine Events >>> China, led by Hong Kong and Shanghai, has undoubtedly become an important wine events destination of the world. Whether it is Vinexpo, numerous trade events, high profile fine-wine dinners hosted by who’s who of the wine industry or events organized by various wine-producing countries’ trade bodies, each has contributed to the wine buzz in the country.

Wine events like the annual Vinexpo have significantly contributed to wine’s popularity in China

India, in comparison, is yet to become a hot international events destination, although in the last couple of years the country has witnessed many high profile wine dinners, niche consumer events and wine festivals. Reputed names like the Hospices de Beaune, top Bordeaux chateaux and many acclaimed producers from across the world have included India as part of their annual Asian itinerary.  These have prepared the groundwork for many such future events, in addition to generating heightened interest among the wine loving community in the country.

# Wine as a health drink >>> Health benefits of wine is an in-vogue topic in the mainstream as well as wine media in the two countries. With cardiac diseases on the rise in this part of the world and severe medical stigma attached to spirit consumption, wine, with its heart-friendly qualities has found a large dedicated fan following.

Wine’s soaring popularity in India and China and its impact on their drinking culture and trade has firmly placed the two countries on the world wine map. Experts believe, and rightly so, that in spite of many ‘teething problems’ like fraudulent practices and fakery in China and highly discriminatory and restrictive taxation regime on imported wines in India, the two countries have demonstrated all the potential to become worthy torch bearers of the East’s wine renaissance. There is every indication that this new-found affection will culminate in a life-long relationship.

Cheers,

Niladri

ITC Hotels wine training – Season 2

In this brief post, I continue from where I left in a similar story in 2011. As a sequel to a key initiative put in place last year, which was widely covered in the Indian wine media, a large number of key F&B resources from across the ITC Hotels chain went through a structured and customized wine training this year too. Armed with their newfound knowledge and skills, this Sommelier cadre is driving a resurgent wine program throughout the chain.

Since joining ITC Hotels last year, it has been my consistent endeavour to lay special impetus on effective wine training, for it is the most vital ingredient in making a wine program successful. Based on this conviction, a long-term plan has been devised to invest in top-notch wine training programs throughout the group in Luxury Collection hotels. Although the returns on this investment have already started to trickle in, it is expected that in the near and distant future this endeavour will go a long way in creating a benchmark wine culture in the Indian hospitality industry.

This year, a total of 150 F&B service staff at all levels went through a systematic and level-by-level selection and training, culminating in the ‘ITC Hotels Level 3 in Wines’. 25 young professionals were awarded this certification and are now proudly leading various wine initiatives in their respective hotels and F&B outlets. They join the core group of 18 Sommeliers certified in 2011.

Every level of the ITC Hotels wine training has been carefully designed to match-up to world standards as well as to cater to the needs of the Indian hospitality scenario, especially those which dictate the business dynamics of ITC Hotels. Whilst the Level 1 was aimed at building the foundation and Level 2 as the stepping stone to acquire advanced professional skills, the Level 3 has been the most potent in achieving high skill levels and in turn larger business goals. This expansive and all-encompassing wine training not only aims to impart theoretical knowledge about a wide range of topics related to the world of wine but also, and most importantly, create the very best F&B sales workforce in India.

Lastly, it gives me great satisfaction and sense of achievement in claiming that so far in the country, this wine training exercise has been the most detailed and comprehensive within a single hotel chain (both in terms of numbers trained and level and content of training). This claim is based on the information I have gathered from my contacts in other hotel chains, speaking to industry experts and information available in the media.

Here is a slideshow from this year’s trainings:

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Quality Wine Education – key to success in unconventional markets

Vinexpo Hong Kong, the Asia-Pacific version of the parent event in Bordeaux and one of the most important annual fixtures of the international wine calendar, concluded recently with much fanfare and a bullish outlook for the region’s wine business. The grand occasion not only lived up to all the hype and expectations, it also reinforced Hong Kong’s stature as the world’s most desired wine destination.

In addition to the usual business protocols and showcases, this year’s event also highlighted the significance of wine education to succeed in new but hugely promising markets like China. The key message; consumer awareness along with a well-informed industry workforce is vital in developing and maintaining a robust wine economy. Here is the coverage of the news article on decanter.com.

Although the news dealt with the importance of wine education in mainland China, considering the enormous prospects it has to offer to the wine businesses world over, the core message is universal and holds equally true for a country like India where wine is increasingly making a headway as part of the urban lifestyle.

So, what are the options available for individuals (and businesses alike, for their employees) seeking to acquire/enhance their wine knowledge? Whether one is contemplating a serious career in the wine industry, the trade looking for well-structured courses to educate their staff or you are simply smitten by the charm of wine and want to demystify the intricacies related to its production and enjoyment, there are numerous options out there awaiting to be explored. Among these, there are only a few selected and trusted ones which offer the most innovative and world-class courses and provide the most comprehensive wine education. I have listed them below.

Please note that courses related to wine production (Wine-making & Viticulture) do not feature in the following list as their focus is markedly different from general wine education.

■ Wine & Spirit Education Trust – WSET, as it is commonly known, is by far the most reliable and effective wine education provider in the world. Recognised the world over for the quality and depth of the courses, it has to be the numero uno of all the dedicated wine education providers. The enormous demand for its certifications means that the WSET is also the fastest growing wine educator outside its original home, the United Kingdom. A rigorous selection process of the APPs (Approved Programme Providers) and a centralized examination control (in London) also make these courses very trustworthy.

The Systematic Approach to Tasting (SAT) wine, developed by WSET is also one of its indisputable USPs which has set a benchmark for many other courses around the world.

The four levels (plus an additional case study, the Level 5 Honours Diploma), each with their distinct theory and practical tasting papers, cater to the needs of different skill levels of the industry. The Level 4 Diploma is a challenging but enlightening two years’ expedition which covers all the wine regions of the world with an additional focus on the commercial and business side of wine-growing plus testing an individual’s ability to correctly identify wines after tasting them blind. The Diploma  is considered to be a vital stepping stone towards the holy grail of all wine qualifications; the Master of Wine (MW).

■ Court of Master Sommeliers – The CMS is a very highly regarded organisation offering wine courses at various levels like the WSET but with a strong focus on the beverage service sector, more precisely to groom professional sommeliers. It’s highest certification leads to the coveted designation of ‘Master Sommelier (MS)’. There are only 170 (till date) of these top wine professionals in the world and majority of them are responsible for running some of the most successful and critically acclaimed wine programs, not only in the hospitality industry but also in the wider wine trade.

■ Society of Wine Educators – Although not yet as internationally recognised as the previous two, the SWE deserves a mention solely based on the quality and clear-cut purpose of its three-tier wine certification program. These are; ‘Certified specialist of Wine (CSW)’, ‘Certified Wine Educator (CWE)’ and ‘Certified Specialist of Spirits (CSS)’.

■ Wine MBA from the Bordeaux Management School – A one of its kind MBA program designed for wine professionals aspiring to take the next big step in the world wine trade. This unique course is structured keeping in mind the dynamics of the present day global wine business. Students have the choice of pursuing this option from any of the four strategic locations – Bordeaux, Adelaide, London or the UC Davis campus in California.

■ Courses run by wine experts – A lot of individuals offer different levels of wine courses which can help you get a head start in the industry or enhance your wine appreciation capabilities. Most of them will either hold a wine educator’s certificate from a recognised institute (like the WSET) or should be adequately trained/qualified to be able to be both authoritative and informative in their teachings. In countries like the UK, USA and New Zealand, many such courses are run by Masters of Wine or Master Sommeliers.

■ Others – There are a number of other options which can be explored as means of laying a foundation for wine knowledge. Most cosmopolitan societies nowadays boast of institutes offering wine courses of various sizes and affiliations. These range from customized courses based on particular requirements like training restaurant/bar staff to laid back and fun events.

There are a myriad of factors that play crucial roles in creating and developing a healthy wine culture in an untraditional market, among which, quality education is probably the most key ingredient that helps in sustaining its popularity and commercial success. Therefore it is in the larger interest of a country’s wine industry to recognise this fact and assign it the pivotal role in all attempts to promote the beautiful beverage.

Cheers,

Niladri