Is there a Market for Long Island Wine Beyond New York?
Since I first became involved with Long Island wine, I have said privately and publicly that I simply do not understand the general lack of national distribution. I have argued that with wider distribution there would be increased recognition and demand, which will benefit all of the wineries on Long Island.
In response to my recent NYCR piece which included another comment with regard to Long Island wine distribution issues, I received two comments. Charles Massoud, proprietor of Paumanok Vineyards in Aquebogue, commented: “As to distribution, indeed we may never be able to distribute beyond our local market, because our local market is huge with over 10 million people between NYC, Suffolk and Nassau. But we do not see this as a weakness or a challenge. In the wine world there are small regions and large regions and they cohabit together happily.”
James Silver the General Manager of Peconic Bay Winery in Mattituck and Empire State Cellars in Riverhead commented: “We are pretending that our (LI wineries) lack of distribution is a choice. It is absolutely not a choice. It is true that we as a group have dabbled in CT and FL and stuck a toe in OH and a little in NJ — but even the greatest of LI wineries can’t (with a straight face anyway) tell you they’ve found real honest to goodness acceptance in NJ or any other place outside of the immediate area….We want distribution and we should strive to get it, but don’t pretend for a minute that we can just take it like it’s low hanging fruit…The modern day distributor of fine and not-so-fine wines is being led around by the nose by one or more of the six mega-producers of wine and spirits. This leaves precious little attention time left for NY wines in, say, Kentucky and Missouri, when they have their own local wineries to distribute. Even then, the local distributor is merely ‘obliged’ to handle their state’s producers.”
I understand both comments. But what really troubled me was an additional comment from Jim: “It’s well known by now that I have found (literally) 100 times more interest in our wines in Shanghai than in Hartford or Hoboken….There is no demand, none whatsoever, for LI wines 100 miles beyond the George Washington Bridge, except by collectors of curiosities.”
Since I have the greatest respect for Jim’s business and marketing knowledge, his comments floored me. I had for years promoted Long Island wines in the Northeast region, as well on the West Coast, and I found among wine professionals that had sampled Long Island wine great respect for the style and quality of most Long Island wines. From their comments, I had projected that consumers would also be interested in Long Island wines and there would be good distribution markets outside New York. But I had not really tested this theory that if wine professionals enjoy Long Island wines that there was in fact a market beyond New York.
So to test my assumptions that Long Island wines can be marketed outside the NYC region I decided to conduct a very non-scientific survey. I spend the winter season in Palm Beach Gardens, Florida. During the winter months 20-30 percent of the population in the area is from the Northeast, with the largest group from New York State. While not wine country, Palm Beach has a number of positives for wine enthusiasts. Wine can be purchased virtually everywhere; wine shops, wine and spirits supermarkets, food markets, convenience stores, drug stores, etc. Restaurants have extensive wine lists due in part to many national and regional distributors serving Florida. The local Palm Beach Post newspaper has multiple wine articles weekly. And there seems to be a wine tasting or wine dinner almost every night during the winter season at retail stores, wine bars and restaurants featuring wines from California, Oregon, Washington, Chile and Argentina, France, Germany, Italy and Spain, Israel, South Africa, and Australia and New Zealand. However, New York wines are difficult to find due to the distribution issues.
I went to the three leading upscale retail wine sellers in Palm Beach Gardens; Total Wine & More (a national wine and spirits warehouse store), Publix (a large food market group which along with its Whole Foods type store, Greenwise, is the largest wine retailer in Florida), and Whole Foods which has a large wine section with 100s of domestic and international wines. I talked to the wine managers at the three retailers and asked if they carried New York and particularly Long Island wines.
The results were uniform and supported Jim Silver’s assessment. Only Total Wines routinely carry New York wines, but of the 57 wines that the company has in its national inventory, only approximately 20 are carried by the Palm Beach Gardens store and almost all are Kosher wines with a few sparkling wines from Great Western and Taylor. Publix occasionally carries some Finger Lakes Rieslings, while Whole Foods does not carry New York wines. The reason is simply that there was no demand.
I was very disappointed that in an affluent community with significant New York residents, there was no demand for New York wines. I doubt it is price as the wine managers indicated that the typical price paid for a bottle of wine in their stores was greater than $20 (closer to $25). Perhaps it the demographics; younger New Yorkers buy Long Island wines and older New Yorkers do not. Perhaps buyers are conditioned to purchase wine while visiting tasting rooms on Long Island, and do not think to buy at the wine retail shop. Or perhaps there really is no interest in Long Island wine.
For those of us in Florida interested on Long Island wine there is some good news with regard to purchasing Long Island wines. Since 2007, wine shipments from other states to Florida residents is permitted with no restrictions on the quantity of wine that can be shipped to Florida. Also recently, Bouké and Bouquet wines, and Macari Wines are both available from Amazon.com wine.
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“Perhaps it the demographics; younger New Yorkers buy Long Island wines and older New Yorkers do not”
This comment applies to not only New Yorkers but to wine buyers in general. As a new Zealander I’m well aware of how something comes to dominate the market and hence the public consciousness. The US wine buyer, IMO, has been conditioned to believe that quality products are derived first from Europe and then from California. After that there are niche markets for products from NZ, Australia, South America, Washington State, etc, etc.
Unless the public can be re-educated demand will never increase and so sales will remain a relatively local affair.
As Jim Silver pointed out in a previous post, the demand in China is likely generated by the name brand recognition of New York City in the chinese society and not by any general knowledge of the quality of the wine. They are buying the name, just doing it differently from the Euro/California-centric US buyer.
For what it is worth, one of our small distributors in Vermont brings several Wölffer Estate to us, and I know that their rosé is a big hit here every summer. I guess Vermont could be seen as a niche market from the outside, but we buy a lot of wine per capita, and have a fairly sophisticated selection, so I would say that there is hope…although this would be more compelling if several more wineries were represented.
There’s a market in the UK
Will – Please to hear the interest in the UK. As my wife lived in London for five years before we married I am somewhat familair with the London retail wine market. Can you define the type of consumers that are buying LI Wines: age, income, ex-pats, wine enthusiasts, etc. Thanks, Len
Hi Len,
The large majority of our clients are high end restaurants, many Michelin starred, two-starred etc.
We also have a few independents that stock certain wines.
Then we have private customers, who I would say are in general fairly affluent and/or wine lovers. Not necessarily ex-pats or people who have been on holiday. Often people have seen some press, had the wine in the restaurant, or have been told to check out NY wine by a friend. They tend to be people who are more open minded with wine choices. I honestly don’t know about age.
With sommeliers we’ve got lots of young, up and coming ones, but then we have some of the most experienced, well known and most well respected sommeliers in Europe pouring the wine!
But I would say it is spread over LI and FLX for all 3 sectors. The price points for the FLX start lower – therefore they can be slightly more accessible for sommeliers to have By The Glass and consumers to have as a weekday wine.
Duty on wine in the UK is pretty high, and there are expected profit margins for each sector. Independents will typically try to get 35-40% margin per bottle. Duty is £1.90 that we pay if supplied in bond, plus there is sales tax of 20%.
Restaurants are often about 3x the price of what they paid, but the price matters less here.
I hope that gives a little insight.
Len- Florida has THE WORST selection of wines. I know, my whole family lives in Juno beach and I have been going there for 13 years. You really expect giant stores like publix and whole foods and total wine to carry little boutique brands from the north fork of Long Island? These stores are known for carrying national brands only. Florida is full of unsophisticated drinkers and diners, I dont care if it is full of snowbirds from NY or not. When my family comes to town they can’t get to NYC fast enough to eat out. When I visit I bring wine with me because I know its nearly impossible to find a wine that isn’t a national brand at publix or whole foods, and those are pretty much the only options for wine shops. There is no such thing as a chambers street, or an astor wines, or anything even remotely “cool” to get a bottle.
Mark – Agree Palm Beach is not Manhattan, and very few places other than San Francisco can come close. Disagree it’s the worst (you obviously have never lived in Pennsylvania). Next time you are here in Winter I will take you to the Virginal Philip Wine Shop and the Hampton’s of Palm Beach (rather ironic name) wine shops, both on Palm Beach Island and convince you there are indeed quality small wine shops in Palm Beach. BTW in Palm Beach Gardens at those awful big retail stores this week I purchased two 92 (WA) point Rhônes (Gigodas and Vacueyras) with many more to choose from, and had a choice of a third of the wines I tasted at the West Sonoma Coast wine tasting last week at City Wine NYC including; Hirsch, Flowers, Joseph Phelps Freestone, Pahlmeyer, Ramey, Soujourn and SCV, none of which is a big national brand wine. Len
Ha, no I have not lived in PA, but I’ve heard…
I am sure that you can get well scored wines in shops there in , as you can in just about any store, even big discounters have high scoring wines, and even big production wineries get big scores (Guigal?). I dont shop by score personally, and don’t really use that as a gauge on whether a shop has good wines or not. The wines you name above (except for a couple) I feel are pretty much “national brands” at this point (not saying they are owned by constellation or are bad wines, but they have hefty production and widespread distribution). Phelps, ramey, flowers, etc can be found in just about any retail store in this country. There is also the fact that big named california wines sell, and they sell easily to people with the cash to spend on them. So the demand is there for these big california wines. But can you walk into a shop in florida and find a Tempier Bandol? Or a Puffenay? Or a Pierre Peters? I guess that is what I am getting at.
Lieb Cellars Pinot Blanc, Cabernet Franc Rose and Right Coast Red are now available and selling well in PA. Over 750 cases of Lieb’s 2011 Pinot Blanc have sold already. Finger Lake’s fine wines are also in PA. In a few weeks I will have 5 wines from Lamoreaux Landing and 4 from Sheldrake Point in PA Wines & Spirits Stores. 5 different Reislings and 4 reds including Cab Franc and Pinot Noir.
Great article and comments! I think NY is close to seeing the market demand and interest through the marketing and awareness activities that have been going on for some time now, and recently have been focused on markets closer to home, like NYC. That market demand is the key to success for NY producers. The product can be great, but it will sit on the shelf unless a consumer is inspired to buy it.
We are also a relatively new industry with most wineries in existence less than 12 years. It takes time to build a market. I ran across this great series of videos showing the challenges a winery faces in distribution that is interesting and accurate. It’s even tougher when you consider most wine in the US is produced by a few companies, as Jim pointed out.
http://www.youtube.com/watch?v=4VjJAfEN7WI
Tom-absolutely no disrespect intended but while your work with Lieb in PA is indeed something to be proud of it is hardly the norm for the Commonwealth yes?
The state stores may take 750 of anything and have literally dozens and dozens of locations who are mandated to take it without question.. But the better question is will it pull through? Will there be a second order? (Depends, but I hope so for sure)
But when a state makes 500, 000 cases of wine and the NEIGHBORING state can barely muster a fraction of a percent of their depletions…or for that matter even provide a ready off-premise market for their own 80 or so home wineries…
No denying the commendable work you’ve done and continue to do though!
No disrespect taken. We have a very long way to go in PA!
To quote a visiting friend from the mid-west when visiting LI last summer… “the North Fork?… might as well be the North Pole!”. It’s was a reminder that our AVA is only known among wine enthusiasts, and when we step out of our backyards to sell wine we either micro-target our sales efforts, or be prepared to do the heavy lifting to bring our region and wines to the attention of strangers, to educate/introduce/experience our wines. The Australians, French, Chileans by necessity are masters of exporting, and have demonstrated the tenacity and long-term investment commitment necessary to build demand for their wines. Market demand must be built, either by the producer or the local distributor, and the economics are usually against new regions and small producers. It is no accident that passionate importer/distributors, the old school brand builders, are endangered species. Long Island is uniquely fortunate to have a huge sophisticated metropolitan market in our backyard, but the two-edged sword is that we are now at a crossroads – either we step up our resolve to be world-class producers, or we settle for local tourism to sell our wines – undoubtedly we will attempt to do a bit of both. Yes outstanding wines can find a home on the global stage if they get support. The question today for small producers is can social media and liberalized shipping laws replace the impassioned brand ambassadors of the past, and compete with global branding teams producing global wines with virtually unlimited marketing budgets.
Gee I wonder why there’s no demand outside of NY,
I can’t even find LI wine west of Riverhead ! My wife and I have been going to the wineries out east for going on 20 years now, we love all of them. but I can barely find anything but Pindar in my local store in the Holtsville area( 25 min fro Cutchogue ). We used to see it in on liquor store ( Pope in Medford). They had a nice selection but now they are down to one or two. They say lack of demand. But the they have TONS of stuff from New Zealand and every other place. I say lack of consumer knowledge.
Let’s not forget restaurants.Oh yea FORGET restaurants.I hardly ever been able to get anything from LI.
I am a big proponent of buying locally and will be happy to pay a little more to do so, Helps me and my community.
Now let’s contrast that with the local beer community you can find LI beer all over the place. In restaurants and bars, Blue point is ubiquitous. I can find Public House , Greenpoint, Spider bite and Long Ireland, and others to different extents.Just about all can be found int the stores.
The wine community needs to look at the way the beer community does outreach. Maybe thing like , instead of having a retail location in the Riverhead outlets on the way to the wineries<put it in the Deer park outlets.to expose and make available to pepole who don't want to hike out east all the time. Also tasteings around Long Island not at 75-100 dollars a person that a lot of people can't afford but at 50- 60$ dollars a person. Restaurants can do Prix Fixe at 35 dollars and throw in some wines and you can get to 50$. on These nights you don't have to charge 35$ dollars a bottle for wine you can get at the vineyard for 15$.
It's called promotion!
I can't tell you how many people I know here on LI that don;t know anything about LI Wine ! Some don't even know there ARE wineries on LI..
Just my rant….