Five of the six wines recently dispatched by a public relations firm promoting Chilean cabernets were all priced at $20. The sixth was $45. At that price, it wasn't just an outlier, but an outlier at a significant multiple. Since it was the first of the lot to be opened, the jury is still out as to whether it is worth twice or more what the other ones are, but that's in an extremely limited context.
Put into a different context, were that $45 wine placed in a lineup with five cabs from Napa Valley, it would almost certainly be an outlier on the opposite side of the price spectrum. Heck, you can hardly touch a bottle of white wine, let alone red, for less than $45 in Napa these days.
Despite recent supply chain woes brought on by the pandemic, at least here in the US we seem to have increasing access to wider varieties of products from every corner of the world. This dynamic in the marketplace has created ever-broadening contexts for consumers. Though there are still die hard, price-elastic consumers who stick with what they love (like the "Napa or nothing" crowd,) younger consumers are fully aware of their alternatives. Many millennials, for example, don't compare Grand Cru Bordeaux to Grand Cru Bordeaux, but evaluate all enjoyable red wines from everywhere around the world at all price points. Not only that, but for younger consumers wine is not as compulsory the beverage it is for baby boomers, but an option for which there are many close-enough substitutes. Hence the rise of craft beer, spirits and seltzers.
Given the huge disparity and pricing of wines almost independent of how narrow it context, what does this say about the future of the industry, particularly given changing demographic preferences/values? Probably nothing: I predicted that Napa's punitive pricing practices would come home to roost in the wake of the financial crisis, yet today Prisoner costs $50 a bottle.
Given the huge disparity and pricing of wines almost independent of how narrow it context, what does this say about the future of the industry, particularly given changing demographic preferences/values? Probably nothing: I predicted that Napa's punitive pricing practices would come home to roost in the wake of the financial crisis, yet today Prisoner costs $50 a bottle.
