Friday, July 16, 2010

Two Buck Chuck~ The True Charles Shaw History

"I love Charles Shaw. I'd never drink it, but it sure got a hell of a lot of people who would never buy a bottle of wine to go out and give it a try."

How many times have you heard people say they do not like the taste of wine and prefer another type of alcoholic beverage? Home many times have you witnesses people try wine, and learn to love it? How many times have you been wine tasting and suddenly realize there is more to wine that fits the eye? How many times in your life have you gone to Trader Joes and purchased a satisfying bottle of Charles Shaw? For me, too many times…..I love wine, that’s basically all I drink, & I’ve done a good job getting all my friends to enjoy it as well. In fact in college we would get cheap cases of wine to host our dinner parties with. It was excellent, & perfect for the college budget. So have you ever wondered why the wine is so cheap? And how this $2 bottle of wine is affordable, yet also decently tasty and good? More importantly, it’s more drinkable than other lower price brands under $1o. So, I’ve decided to investigate…
Apparently there are m
any urban legends and rumors about how the brand came to be. Friends have told me, and I’ve read, about how Charles Shaw wanted to devalue his winery because he was getting a divorce and all wine assets would be distributed to her. Wrong. Or according to snopes.com, people believe its because airlines could no longer use corkscrews so airlines dumped all their stock. Really? Come on people. So the real story: One day in the 1980’s an ininess and venture to the East Coast. This was when Bronco began bottling it in it’s Napa facility. This is the same Bronco wine that includes forest Glen, Estrella, Montpellier, Grand Cru, Silver Ridge, Rutherford Vinters,…..and Franzia labeled his $2 wine Charles Shaw. Franzia began marketing the brand with Cabernet Sauvignon, Chardonnay, Merlot, and Sauvignon Blanc.
A good explanation about the positioning of Bronco- “Admittedly, this is a business model that is going to be difficult
vestment banker came to Napa CA in hopes of producing his Beaujolais wine under his own name. His name was Charles Shaw. His dream did not work out and soon his brand name was bought by Fred Franzia, owner of Bronco Wine Co (the 4th largest wine company) around 2001. In the years prior Charles Shaw Winery was producing Gamay Beaujolais grapes and operated for years in Napa Valley. Apparently, Chuck Shaw chose to leave the wine bust, if not impossible, for most others to duplicate. Bronco is in a unique position to sell an average quality wine for such a low price yet make a profit. The company is huge by industry standards and is vertically integrated. Bronco has access to vast inventories of inexpensive wine and there is currently an oversupply of cheap wine. Another factor is that it is legal for a California producer to sell directly to a retailer, bypassing the wholesaler. Bronco sells Charles Shaw directly to Trader Joe's…. Franzia has been involved in a long running legal tussle with the Napa Valley Vintners Association over the use of geographic brand names like "Napa Ridge," on bottles that don't contain Napa wine. Because Bronco's new plant "cellars and bottles" wines from throughout California in Napa, the labels reflect that. If any Napa vintners feel violated because Charles Shaw once lived in the Napa Valley, they shouldn't be. An average wine at this price point stands to bring in new wine drinkers.”
So basically, Fran
zia is able to still label the cheap wine with the prestigious “Napa” region. However, because the grapes are significantly cheaper from the central coast area, it can be sold to consumers for budget bargains, incomparable to most other Napa labels. Impressive? I think so….” The price reflects less on the quality and more on California's overabundance of grapes. With the dot-com boom in full effect in the 90s, vineyards were reaping the benefits and planting vine after vine. [The dot-com bust left the area] with little demand and a huge supply [of] good-quality [grapes]."
Whats more impressive than just the product of a cheap, decent
wine, is according to sources, Charles Shaw brand had no advertising or marketing when it first hit the markets. Within a year it was selling over a million bottles a month, and that’s only because of the perfect packaging, that hit the right target at a good time. Charles Shaw defies the basic marketing Lawson product, promotion, price, and place…..They developed a brilliant product that essentially is always in demand (who does like wine & drinking?), and was able to label it as the best on the market (Napa region), at the best price ($2), and sold it where normal everyday people could get access to it (grocery store). Pure brilliance. It doesn’t even compete with boxed wine because the packaging it more profound and elegant. It’s more dry, less watery, and taste like real expensive wine. Well it is real, just the grapes are cheaper, and it is claimed, (not sure if I believe it) that no residual sugar is added…which essentially means less of a hangover compared to other boxed/ cheap wines.

By 2003 Trader Joes was able to stab a piece of the cash cow- “Charles Shaw wines, sold exclusively through the Pasadena, California-based Trader Joe's chain, have been flying off the shelves at a bargain $1.99 per bottle. Trader Joe's is having a hard time keeping them in stock. The wine is an amazing value, so people are wheeling it out the door by the case.”
Harvey Posert, a long-time industry publicist who currently consults for Bronco, stated "two-buck Chuck" is likely to attract new wine consumers.

"People are going to buy this wine and serve it to people who have not been exposed to wine favorably and they will say, 'for $1.99 I can go and try wine.' If the average American can buy a bottle of wine for $1.99 and serve it to people and the quality is there, he's going to become a wine drinker. Wine doesn't have to cost a lot and it has this image.”
Today it is selling over 5 million cases per year, all through one chain of stores—Trader Joes.

Yes wine is expensive, and a very acquired taste. In college people made fun of me when I rolled up to a party holding a bottle of wine, or went downtown and ordered it at bars. Yes, I was that girl…However, once my friends and roommates actually tried the wine they began to enjoy it. It started with cheap boxed wine to get a good buzz, then slowly their palette changed and after much wine tasting in our college town, and a few dinners with some Charles Shaw, they too were hooked on wine….well maybe not as much as I am . Thank god for Charles Shaw….for opening the wine industry to all those newbies, competing with those higher price brands that taste like shit, & for changing the wine industry—for the better. And thank you Mr. Franzia for having the guts to try something new, the tenacity to pursue an idea, and the marketing skills to make this brand work.

Best quote & explanation about this brand---
"There's not a doubt in my mind that the two biggest things that have happened to the wine industry in the last 10 years are the movie Sideways and Two Buck Chuck," says Gary Vaynerchuk, who reviews wines on his popular video blog, Winelibrarytv.com. "Has Two Buck Chuck hurt some $8 to $15 brands? Yes. But it's helped the industry overall by bringing in new people. What Franzia is doing, more than creating outrageous quality, is exposing a lot of mediocre people. There are so many fools in the wine industry who are overpriced. Look at Franciscan, Simi, Kendall Jackson. Those guys are jokers."

"A lot of people object to Fred because of jealousy, a lot of people object to him because of his business practice - which is, simply, if the law says I can do this, I'm going to do this to the fullest extent," says Michael Mondavi, founder of Folio Fine Wine Partners and a close friend of Franzia's who went to high school and Santa Clara University with him. And, Mondavi believes, they mostly hate him because his company scares the crap out of them: "When Fred built a bottling plant in Napa, everyone's great fear of the San Joaquin Valley invading Napa Valley mushroomed."

(I highly recommend this article about Franzia! http://money.cnn.com/2007/09/05/news/companies/Two_Buck_Chuck.biz2/index2.htm) Charles Shaw awards: At the 28th Annual International Eastern Wine Competition, Shaw's 2002 Shiraz received the double gold medal, besting the roughly 2,300 other wines in the competition.[4] Shaw's 2005 California chardonnay was judged Best Chardonnay from California at the Commercial Wine Competition of the 2007 California Exposition and State Fair. The chardonnay received 98 points, a double gold, with accolades of Best of California and Best of Class.[5] http://www.winebusiness.com/wbm/?go=getArticle&dataId=21668 http://www.budgetvino.com/2006/10/the_mystery_of_.html http://money.cnn.com/2007/09/05/news/companies/Two_Buck_Chuck.biz2/index.htm?postversion=2007090703

1 comment:

  1. Used this in the frosting for my sangria cupcake :)

    ReplyDelete