Don't Follow the Fad, Follow the Money

Has New York wine society experienced its Radical chic moment? Certainly the talk around town about faddish wine behavior might lead you to think so. Sommeliers affecting worldliness by introducing funky, no compromise, aggressive wines into the dining rooms of established, well heeled New York? Maybe it sounds a bit like the more arty side of New York high society trying to seem in touch with their era by throwing parties for extremists like the Black Panthers in 1969 and 1970, when it was the hip thing to do. Leonard Bernstein wasn't the first to throw such a party, but he was certainly one of the last, after being roundly mocked in print in England and in the papers closer to home. Bernstein was made to look like a fool for trying to be vicariously cool.

Recently the New York wine trade was addressed in the same manner by the esteemed writer Jancis Robinson, who reported in the Financial Times that the sommeliers here are obsessed with fads and a desire to acquire the cred that comes from being seen at the hip events with the hip wines. Tellingly, no one publicly disagreed with her take but me, which says a lot about how foolish I am willing to be on Twitter, and even more about the apparent numbers who agree with Jancis that New Yorkers are a bunch of followers.

I don't know what Leonard Bernstein's motivations might have been, but I do know that the recent history of wine trends has been as much about economy as novelty, and that that part of the story has often been left out of the retelling. So what is going on? The underlying reality is phenomenal price escalation. Phenomenal, soaring price escalation that is unmatched in the history of wine in the modern world. What used to be available for a certain price a few years ago is now much more expensive. Against that, you have an end consumer who still wants to spend the same amount on wine that they always have, a number range that essentially hasn't changed for 10 years. Those realities provide a recipe for tremendous flux, the sommelier hopscotch of today.

It is worth spelling out what the parameters are. If these numbers look a little odd to you, that is because they are the wholesale prices, the prices that the restaurant buyer has in mind.

· $8-$22/bottle wholesale has been the standard range for a wine that can be sold by the glass, pre-Coravin

· $8-$19/bottle wholesale is also the lower end of what is accepted pricing for a bottle of wine on the list: the sort of wine that might be drunk at a dinner at a casual restaurant, at lunch at a more expensive venue, or bought for a larger group going through several bottles

· $20-$60/bottle wholesale is the meat of what moves by the bottle at most any restaurant, skewed towards bottom of that range for Brooklyn and more casual dining rooms, and towards the upper spectrum of those numbers for Tribeca, the West Village, the Upper East Side, and some other neighborhoods

· $60/bottle and higher is for wines which are perceived to be rare or of especially high quality, also for wines with age; this is the area where well regarded, luxurious restaurants can ply their trade, and where more casual restaurants rarely do

As a wine ascends through those range of prices, what can happen with that wine at a restaurant changes. That is the key point to understand. What the customer has in mind to spend is pretty much fixed. When you realize that Cru Beaujolais sells for $13 to $25 per bottle generally and up to around $35 bottle for certain bottlings, you can understand its broad appeal at the moment. It hits a lot of price categories. Cru Beaujolais can be sold by the glass at a wide range of venues, but it also currently works as a bottle sell at both casual restaurants (where it might be towards the high end of the price spectrum for a bottle) and more formal venues (where it would be towards the bottom end of the price per bottle range). Consequently, a lot of sommeliers are fans of Cru Beaujolais. It has something to offer each of them. And this is at the same time that other types of red Burgundy, the Volnay and Beaune reds that used to fill this particular niche, are more expensive. But the widespread sommelier love for Cru Beaujolais is recent. Both the 1999 and 2005 vintages came and went without much sommelier support. It wasn't until the 2009s were released that there was an uptick in interest. Before that time, Cru Beaujolais had been mostly a retail staple. The change had to do with pricing. Cru Beaujolais, and also other red Burgundies, had been cheaper before. In effect, Cru Beaujolais had to become more expensive for it to be so useful to sommeliers.

When you look at the dollar goalposts, something else becomes apparent: there is a Champagne by the glass problem. Champagne starts in the wholesale market for about $19 a bottle, rock bottom, and quickly goes up from there. That is towards the top end of what the consumer wants to pay for a glass of wine. You have some consumers who are willing to pay more for Champagne, because it is Champagne, and some others who are very much put out by that idea. What to do? The restaurant might offer less expensive sparkling wines from areas other than Champagne, or they might take a less than standard mark up on Champagne. But in general there is always a desire in the market for less expensive Champagne of good quality. The Aube, which is historically a less prestigious area of Champagne production, has been greeted with increased interest from buyers in recent years. Without the fame of other Champagnes, the offerings from the Aube were often less expensive. The Aube is further to the south than the other Champagne regions, and a warmer area as a result. Producers there have riper grapes, and some of them decided to use less of the sweetening dosage as a result. When you look at no dosage Champagnes becoming popular in the States, it can be helpful to consider that the more successful no dosage wines have often come from the Aube, which has been a source of less expensive Champagne. Now that certain names from the Aube have garnered more acclaim, their prices have gone up, and consequently people are more likely at this moment to question whether no dosage is for them.

This brings us back to the consideration of rapid price changes. Cru Beaujolais and Aube Champagne are often small production wines. As one particular producer name begins to establish itself in the market, the amount of wine they have available to sell may not meet the demand of the many restaurant accounts asking for it. This can lead to frequent changes on wine lists, as what is available for sale quickly turns over or becomes more expensive. Someone who is less connected with the vagaries of the wholesale market might see the changes as the sommelier trying to keep up with the latest fad. In reality, they are trying to stock wines at prices their customers want to pay. The frequent switches are exacerbated by the smaller cellar spaces available to restaurants today in a tighter real estate market. The sommelier can't buy a large quantity of a wine when it is available, because they don't have the space to do so. That means more turnover of stock, and a market where the restaurant buyer isn't aging wines so much as buying them for ready sale. It also means that restaurant buyers are affected by the pricing trends of the moment. They aren't insulated with a cushion of wines still in inventory that were bought three years previously, when the market conditions were different. What the sommelier is selling at a given moment is also what the wholesaler is selling at that moment.

So why not buy larger quantity production wines? One reason is that if restaurants do buy those wines, they are faced with a direct pricing comparison to retail wine outlets who have the space to buy wines in quantity, and who leverage that space to take advantage of deep quantity discounts. Larger production wines often have large wholesale discounts available for massive quantity orders. Restaurants can't play that game, and they can't afford to have their customers ask them why they charge so much for a wine that can be purchased for so little at retail. With small production wines they face less chance of that happening. When someone raises the question, as Jancis did, of why certain areas of the winemaking world are ignored by buyers in favor of others, it is worth considering what kind of production levels are common in each. If a country's wine production is dominated by large producers, it is likely you will see less representation at the restaurant level here.

All of this might seem to handicap the sommelier, but it hasn't. In fact, sommeliers have never had more influence with the public than they do now. And this is partly because the sommelier is suggesting a product at a price that the public wants to pay for it. They are demanded to do so by their guests. As prices for many wines went through the roof, many wine critics followed suit. While issuing occasional grumblings about increased expense, they would still give high scores to the wines that were only going up in price. They didn't have to look someone in the eye as they made their suggestion, or sense the discomfort with a price on a wine list. A wine critic sitting alone giving scores doesn't face that resistance. At some point a large swathe of the public opted out, which is why you often see wine critics writing today with the specialized collector in mind. By maintaining a trade in wines offered at prices that people want to pay, the sommelier has become increasingly relevant to the consumer looking for drinking advice. Which is to say that sommeliers aren't obsessed with fads, they are obsessed with the reality of the market. If sommeliers are sometimes dealing with wines at extremes, that is because today's wine market is so extreme.

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