Wednesday, August 14, 2013

The Future of Allocations

Over the last few days I received emails from two highly sought-after wineries whose wines are without a doubt expensive and in demand. The wine allocation list is the holy grail for wineries. Allocations go something like this: Our limited production wines are sold by mailing list and are available in select restaurants around the world. Our mailing list is presently full, but we can add you to our waiting list. We move clients onto the mailing list based on when you contacted the winery, as space becomes available.

Demand exceeds supply. More people want to buy the wine than can and the winery limits the amount of wine a customer can purchase. Sometimes, if a client decides to not buy a given vintage, they are removed from the mailing list. Marketing, branding and distribution can take a backseat to the production side of the process and almost an infinite amount of detail can be given to the viticulture and winemaking. Critics give the wine glowing reviews and high scores. Demand increases and the process repeats itself. Waiting lists for the top wineries are often years long, but they've got nothing on the Green Bay Packers' season ticket wait list (see the second-to-last FAQ).

But what does the future hold for allocation lists? Are they really as robust as they seem? Are they the best way to build a customer base?

Well, the waiting lists may not be as long as is generally thought. Or at least certain ones. I signed up for the Rochioli Winery list five years ago after visiting the winery and only received an offer to buy this year. That was to be expected. But an email from Bryant Family Vineyards (Bryant is commonly listed amongst the five or so "cult" wineries) caught me completely off guard. I visited Bryant Family Vineyards last year while researching my Pritchard Hill story for Sommelier Journal and I also interviewed Don Bryant for Decanter.com. I guess you could say that I am more familiar with Bryant than my bank account would suggest. I knew that the wines were outrageously expensive, but they were also amazingly good so I decided to sign up for the waiting list thinking I wouldn't be offered an allocation for at least five or six years (that would give me enough time to correctly pick the winning Powerball numbers...). Well, Bryant's price increase to $425 per bottle and the ramp up in production has obviously whittled down the waiting time for people that signed up to be offered wine. A few days ago, and less than one year after signing up, I received an email that afforded me the opportunity to secure my place on the mailing list by purchasing a minimum of six bottles of the 2010 vintage. As much as I wish that I could afford to buy the wine, I cannot (anyone have $2500 they want to donate to me?). Though the wine may still be as great as its reputation suggests, the allocation list is not as strong as it once was.

I started to think about the health of other wineries' allocation lists. As I predicted last year, it seems that the California "First Growths" may already be increasing their production, even before the high-yielding 2012 vintage hits the market. But, the rapid rise in price for the likes of Harlan, Screaming Eagle and Bryant may also be culling less well-heeled customers from their lists. Will other wineries with mythically long wait lists also start offering surprised hopefuls a chance to throw down several thousand dollars for a half case of wine?

But it was actually another email from an Oregon winery actually was the impetus for this post. Yesterday, I received an email from Antica Terra offering their 2011 Antikythera ($100 pinot noir) and the 2011 Aurata ($75 chardonnay). I almost dismissed the email immediately, as my wine budget doesn't have room for newcomers at the moment, but I saw the email also was announcing some news about their allocation process. With my interest piqued, I clicked on the link and my jaw almost dropped. To quote part of the announcement:

We cannot, in fact, think of any other consumer relationship with such ingrained complexity and rigid sets of barriers. Whether one’s interest is in cars or croquet mallets, bottarga or Broadway tickets, the only requirement for purchase is sufficient funds. Why should the experience be so dramatically different with wine?

We’ve come to believe that it should not. In an effort to make the whole experience of our wines more fluid, more beautiful; we have removed all impediments, made everything much more straightforward, open and easy. We want to move this conversation to a place that reflects the generosity and connection that have long been the hallmark of our relationship with you.

Our doors are open. Please order what you’d like in the amount you’d like, visit us at the cellar if you find yourself in the Willamette Valley, call us on the phone to let us know if there is something we can do for you or drop us a line and tell us what you think of the wines.

We’d like to take this opportunity, once again to thank you for your wildly generous support and enthusiasm for the work that we do. We are keenly aware that were it not for this relationship we would be alone in the long shadows cast by the wine that we’ve made. 

I can't really add more than what is written above. I applaud Maggie Harrison and her crew for having the courage (foresight?) to reject the established distribution paradigm for elite wineries. But will the wine become even more scarce as people start buying multiple cases rather than multiple bottles? The limit on the number of bottles a customer could buy is sometimes cited as one of the advantages of allocation lists. More people, theoretically, can buy the wine. Only time will tell if this was the right decision for Antica Terra and its current and potential customers.

Perhaps these two examples provide a glimpse into the future of wine allocation lists. Perhaps they are anomalies. One thing is for sure; we are going to start to see changes with the way wine is distributed and allocated. What is your experience with allocation lists and what do you think the future holds?


  1. It's an interesting question. I doubt allocation lists will go away completely though. They lend an air of exclusivity to the wine that may help prop up the price.

  2. Kim, I doubt they are going away either, but I did find these two stories interesting in their own right. Exclusivity is something some people seek out and something others abhor. Building relationships is the way of the future and it is up to each winery to figure out how to best accomplish that for themselves. Thanks for the comment!