On this episode of the “VinePair Podcast,” hosts Adam Teeter, Joanna Sciarrino, and Zach Geballe discuss how wine prices have exploded in restaurants, as glass pours and bottles alike are now routinely far more expensive than other drinks options in many establishments. Plus, an extended conversation on how Louisville became a major tourist destination for bourbon lovers. Tune in for more.
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Adam Teeter: From VinePair’s New York City Headquarters, I’m Adam Teeter.
Joanna Sciarrino: I’m Joanna Sciarrino.
Zach Geballe: In Hilo, Hawaii, I’m Zach Geballe.
A: You just wanted to say that, and this is the VinePair Podcast. Wow, what a flex.
J: Wow, brag.
A: Yes, such a brag. I was at first going to be like, at least Joanna is still with us. We just all got to get jealous that Zach is in Hawaii.
Z: Well, if it makes you feel any better, it’s rained 11 inches since we’ve been here and it’s only been a couple of days.
A: Does it rain a lot in Hawaii? Oh, boo hoo.
Z: It does rain a lot where we are, sometimes. We happened to pick possibly the rainiest week of the last five years to come.
A: Oh, wow.
J: Oh, dear.
Z: Yes, it’s one of those things that’s funny about coming to tropical locations in general, you have that capacity for just truly incredible amounts of rainfall in incredibly short periods of time. We took the kids to a pool, there’s a swimming pool and stuff yesterday. In the span of about 20 minutes we had beautiful sunny weather and just the hardest rainfall that either kid has ever seen, and about as hard as I’ve ever seen it rain, and then back to sun and then back to rain again. It’s super unpredictable, which is fun, but also makes it hard to do some of the things that might seem appealing in Hawaii. Anyhow, the point is, I’m here, I want to show my commitment to the listeners. As I said before we started recording, y’all have been showing up for us, so we want to show up for you. Got Adam fresh off a trip on vacation. Joanna-
J: Biding my time.
Z: -almost ready to have a child. We’re here for you folks.
A: Just twiddling them thumbs.
J: Are you eating a lot of pineapple, Zach?
Z: Actually, I’ll talk about this more when we talk about what we’ve been drinking, but the highlight of the trip so far, for sure, has been the fruit. Love me some fresh fruit. Not a lot of pineapple, a lot of papaya, a lot of mango. I like pineapple, but weirdly, it’s like the fruit that my son doesn’t like, so we haven’t been getting into that as much. He’s more a fan of the others. Yes, lots of fresh fruit. Of course, my daughter, love her, is like, “No, all I want to eat on this trip, apparently, is olives and blueberries.”
A: That’s hilarious.
Z: I know.
A: Lots of poke or no poke?
Z: Well, no poke for me, but lots for Caitlin and for Saul.
A: Oh, right.
Z: Yes, I know coming to Hawaii with a seafood allergy is not the greatest.
A: What about Spam? Spam?
Z: No, I’m not allergic, but haven’t gotten there yet. Maybe next Thursday. The thing I’m really looking forward to is getting some Malasadas, some Hawaiian donuts. That might be coming up.
J: Oh, yes.
A: Oh, yum.
Z: Big fan of those and lots of other fun stuff. We’re going to do a lūʻau in a couple — well, by the time you all listen to this we will all have been to said lūʻau but that’ll be cool. Get some kālua pig-
J: Some pork and some poi.
Z: Yes.
A: Cool. Cool. What have you been drinking Zach?
Z: I was going to say one of the highlights for me has been just combining fresh fruit and booze, which is great. I do that at home sometimes, but it’s nice when you have a range of options beyond just mostly citrus. Although there is of course citrus here as well. A lot of passion fruit or lilikoi as it’s known in Hawaiian is delicious. Just a little sweet, nice, and tart. Pairs really nicely with so far tequila, rum, vodka goes well. It’s been nice. Also drinking some local beers. Had an IPA from a brewery here on Hilo called Ola, was nice, pretty classic. I would say that was just the only one that I happened to try. They have a range of beers but pretty classic West Coast-style hop-forward IPA but not overly bitter, nice and pleasant. Yes, that’s been a lot of it. We’re going to do some — Caitlin and I are getting a night out away from the kids once my parents get here. We will probably hit one of the cocktail bars here in Hilo but have not really gotten a chance to do a lot of that. We had Piña Coladas at a touristy restaurant in downtown Hilo, which were fine and definitely a blended Piña Colada is not a bad thing, especially when the fruit in it is fresh, but looking forward to something. I think the bar we’re going to go to has some interesting-looking renditions of your classic Hawaiian cocktails or tropical cocktails and that should be pretty interesting.
J: Nice.
A: That’s cool.
Z: How about you, Joanna?
J: No, pass.
Z: Anything?
J: Pass for me.
Z: Pass.
A: Totally pass. You’re just done. There’s nothing to say.
J: You guys are drinking for me. Yes. Nothing for me.
A: I got nothing to say.
Z: You were just doing that-
J: Adam, yes, you just got back from a trip of pretty-
A: I was in Kentucky.
J: Spirits-heavy trip.
A: First of all, I have a quiz for you, a pop quiz.
J: OK.
Z: Oh God.
A: Is Louisville, Ky., in the South or the Midwest?
Z: It’s in the South.
J: I think the South as well. I think geographically it is-
A: Right across the bridge is Indiana. We asked that question to a bunch of people because it’s such an interesting city because there’s lots of stuff that feels Southern. A lot of people would say to me as their answer, it’s the first city in the South because there’s a lot of the city that feels Southern but just as much if not more that feels Midwestern. Because they don’t have any pro sports teams, there’s a lot of allegiance to Cincinnati teams and Indianapolis teams and they’re the closer cities. Indianapolis is only an hour and 20-minute drive whereas the closest other major Southern city is Nashville which is almost two and a half hours or longer. What’s interesting, though, is what everyone says is now go an hour away from Louisville to Lexington and then you’re in the South, then you are for sure in the South. It’s this very interesting city and also has more iron architecture than almost anywhere besides Soho. You know all those beautiful iron buildings in Soho, it’s all over Louisville’s downtown so just a very pretty city. I was there for lots of work meetings trying to get all those in before I am also out. I got to drink some delicious bourbon. The few of the highlights for me was, one, we went to this really cool bar that’s opened in the area, I think of NuLu in Louisville, the neighborhood of NuLu, called Neat. It’s become this thing over the past — the taters that basically people are now really into vintage bottles of bourbon, so bourbons from the ’40s, ’50s, ’60s, ’70s. These dusty hunters go out and find these bottles and literally liquidate people’s attics and stuff like that. In Kentucky, it’s actually legal for stores and bars to resell someone’s private collection.
J: Wow.
A: You have a lot of bars now that are devoting a few bottles, so things that are antiques, but this bar that’s all they have. I got to drink some really unique bourbon. I drank Old Crow from the ’60s that was part of what was called the Chessmen campaign. Basically, they started putting old — so it’s really weird. People have started saying that they think — a lot of these bourbon people have said they think Old Crow from the ’60s and ’70s is now considered to be the best bourbon that was ever made. The Chessman series is one of the series that people look for. In order to drive up the business for bourbon, and interest, Old Crow decided to create a full chess set of porcelain chess pieces and fill them with bourbon — they’re bourbon and the idea is you collected the entire set and could play chess.
J: Wow. That’s so smart. Such a smart marketing thing.
A: There’s a bunch of that you see that happened in like the ’60s, ’70s, and ’80s when nobody wanted this stuff. Everyone talks about that. There’s still this very much, in Louisville and in the surrounding areas, recognition that this boom that’s happening is incredible. No one says they forget that — even up until the late ’90s, people were trying to give this away basically. Now some of these bourbons that were selling for $7 or $8 on the lower shelf of a liquor store are now bourbons that are reselling for thousands of dollars.
J: Wow. These bottles are really cool.
A: They’re really cool, which is pretty insane. I gotta have that.
J: Was it good?
A: It was delicious. Look, I had a half-ounce because it was $50 a half-ounce.
J: Oh my goodness.
A: We did one, we were lucky to be out with one of our partners who paid for it. Then we all tried it but it was pretty delicious. Then I also had a full ounce of a 1983 Wild Turkey that was delicious and I’ve always liked Wild Turkey. That’s my birth year. Now you all know how old I am.
J: Courtesy of bourbon.
A: That was pretty cool. That was much more reasonable. That was $25. It was an eight-year-old bourbon, it was Wild Turkey 101, eight years old, 1983 and that was $25 for the full ounce. That felt like a little bit better of a deal but it’s really interesting what you see there.Then the other thing you see is, there were these other bourbons that are only in the Japanese market. I think that’s something that a lot of people don’t realize is that when bourbon was really, really, down here, one of its strongest markets was Japan and then there were other parts of Europe that were still really into bourbon, including apparently France. That’s why there’s a lot of Japanese companies that own bourbon brands. Obviously, Suntory owns Beam, and Maker’s but then Kirin owns Four Roses. A lot of the reason that Japanese companies own bourbon brands is because bourbon has always been really, really popular in Japan. I found that fascinating. There’s also a lot of brands that were at this place, Neat, that are brands made by a distillery that just exists now in the Japanese market that are basically the same as one of the coveted brands here. For example, they had bottles of Ancient Age, which was a brand that was pretty big in the United States in the ’70s and ’80s and then has stayed big in Japan and is still apparently quite affordable in Japan but in the U.S. now it’s Eagle Rare because you will think it’s the same liquid. Now Eagle Rare is almost impossible to find.
J: I think a lot of people think Blanton’s was created for the Japanese market, specifically, right?
A: That’s the other thing that I want to write an article about is, it was amazing. Everyone in Louisville is pretty honest. Everyone behind the stick is pretty honest. It’s Blanton’s, who cares. If you go to any bar in Kentucky, and there’s Blanton’s on the back bar, I guarantee you, the horse isn’t there. If you ask any bartender why, for them, usually, it is because a big spender came in, ordered a glass of Blanton’s and then said, “I’ll give you a few $100 for the horse.”
J: Oh my goodness.
A: People are buying the f*cking horse.
J: Just the stopper.
A: Just the stopper because they’re collecting them-
J: They collect them?
A: -because they want to spell out lands or whatever. Bartenders would be like, “No, no, I won’t sell you the horse.” “Yes, sure? A few $100, yes, sure. Here’s the horse.” It’s crazy. It’s crazy. I also got to go to some of my — I think it was my second-ever distillery visit. We have to tour some amazing distilleries when we are meeting with people and it’s pretty incredible how much money has rushed into Kentucky. We saw distilleries owned by private equity. We saw distilleries owned by people with very high net worth. We saw distilleries obviously owned by large companies. It’s just insane. There’s also a lot more now in Kentucky, distilleries that are opening to almost function like MGP. They have their own brand but they’re also following that model of, well, there’s lots of people who think they want to start a bourbon brand but they don’t have the capital to go all in. This again, was apparently not a thing, even over a decade ago. Now you have a bunch of distilleries that are opening with that business model where it’s like, “Well, yes, we have our brand, but then we also produce the whiskies for X other brands,” and realizing MGP really had a monopoly on that for a very long time. The one thing that MGP doesn’t have that these companies have is MGP is made in Indiana. It’s not Kentucky. If someone asks, “Well, is this a bourbon from Kentucky?” and you have MGP juice, you can’t say that. No, it’s not, but these are. It’s so interesting. Everyone just said it’s completely changed Louisville, the amount of money that has rushed in has just changed the bar scene, the restaurant scene, the hospitality scene, the hotels, everything. It was really fascinating.
Z: Shiv raises a question that I wanted to ask. I was in Louisville a number of years ago for a friend’s wedding. His wife is from Louisville and so that was where they had a great time, experienced some of what you talked about, although even in those days, the affordability of some cool bottles of — I was really one of the only people in my friend group who was interested in going into some of the better bars and looking for some interesting bottles, but it was striking to me how much more affordable some of the bourbons and other whiskeys I wanted to drink were in Louisville than they were in Seattle or New York or whatever. What also surprised me, or at least I thought at the time, was, why isn’t this a bigger tourist destination? In particular, more of a destination for things like, I don’t know, bachelor parties and stuff like that, or bachelorette parties? Why isn’t it more akin to Nashville? I didn’t have an answer for it. I don’t know, it does strike me as maybe Nashville is a little bigger, it has, obviously, an association with music. I would think that the bourbon is a big draw for a lot of people. Obviously, it’s an incredibly popular spirit. I was wondering, did you get a sense, Adam, from being there that it is becoming much more of a tourist destination than it used to be?
A: Absolutely. The reason for that-
J: It just hit a new record, right?
A: Yes.
J: The Kentucky Bourbon Trail?
A: Zach, the reason for that is — how long ago were you there?
Z: Probably eight or nine years ago now.
A: The reason for that is, before this, one of the main reasons why Louisville wasn’t the destination, and why — there are bachelor parties that I think went to Kentucky, but is that the actual distilleries that have these hospitality centers, they are far apart from each other.
J: They’re spread out.
A: The bourbon trails, they are very spread — these are ultimately, especially, the big ones — let’s not romanticize this, these are factories. These are huge factories that happen to have visitor centers and cool experiences. It is very cool to walk into a rickhouse and see all these barrels and go into the distillery. When I was at Beam, they told me this one main still we were looking at puts out 200 gallons of whiskey a minute.
J: Oh, my goodness.
A: The distillery we were at was their main location. Their Boston facility, which only produces white label, puts out 400 gallons off of its still a minute. It’s incredible how much production is happening at these places. Because of that, you have to have space, and then you need massive acreage for all the rickhouses that are on the property. For the most part, if you’re trying to do it as close to the source as possible, just because of logistics, you’re not going to then have another facility an hour away that you’re trucking all these barrels to every day. What has changed in Louisville is these experience centers now that have all opened on what was the old Bourbon Row, and distilleries actually opening in the town. Now, you have Michter’s in the town, Angel’s Envy in the town, Rabbit Hole in the town. Then all the other distilleries are now opening crazy experiences with either small stills for you to be able to visit wherever. There’s Old Forester, Bardstown is opening a location, Evan Williams is downtown. All this stuff is happening so that you can come to Louisville for two nights and feel like you visited five or six distilleries, and stay in Louisville, and walk around, because let’s be honest, and be drunk, and have access to Uber, and things like that, and not worry about having to go an hour outside of Louisville to Bardstown where there are distilleries all around but are far from each other. Four Roses is close to Beam, but it’s a 15-minute drive. You are either hiring a driver the whole time or someone in your group isn’t drinking. I think that that’s why, but they said, “Now, yes,” and there’s a lot more bars and things like that. The other thing that you see in Louisville, which is a segue to our conversation today is, Zach, the wine is f*cking expensive. What’s really interesting is, still in town, the cocktails are not. A lot of cocktail bars — even fancy cocktail bars — we went to a few of really cool cocktail bars. My favorite was this place called Expo, which happens to be owned by one of the people who founded Camp Runamok, which is a big bartender immersion program. They all pride themselves on having a $5 or $7 cocktail. All of them, even the fanciest ones. It’s like, “Well, this is our $5 cocktail.” At Expo, it’s an Old Fashioned. A lot of people in Louisville say that the official drink of Louisville isn’t the Mint Julep, it’s the Old Fashioned. I have to say that almost across the board, everywhere I went, the cocktails were very affordable, $10, $11. A lot of the whiskey pours are pretty affordable. Everyone would say the same thing to us, “The whiskeys, the taters, you’re looking for are expensive.” There are bars that specifically exist and liquor stores that specifically exist to cater to those people who just want the expensive stuff because that’s why they got into bourbon in the first place. Those places exist and that pricing exists but the bourbons that if you know, you know, Larceny or whatever, those are still very affordable on the list. Meanwhile, the bottle prices and glass prices are just as expensive as we’re seeing everywhere for wine. To take part three of this conversation, that we’ve now had over the course of a few weeks, something’s got to give here because it honestly feels — you are completely changing the expense of your night now by choosing to have a bottle of wine instead of choosing to have cocktails and it’s going to cripple wine. I don’t know any other way around it. I love wine so at every — we went out two nights in a row to dinner and both times we had wine and even though it’s a work expense, I’m like, “Oh, this is crazy.” It is absolutely crazy that these bottles are all over $100. What is going on here? Why are we having such an issue?” I think what was interesting to me about it was that I thought prior to Louisville — I know that you had said it’s happening in Seattle, Zach, but I also know that Seattle is a city of very high net worth as well, tech, et cetera. Then I was like, “OK,” but then to see it in a town like Louisville when the cocktail prices are still quite low, I was like, “OK, so this is actually a national trend,” and we’re hearing about it from a lot of listeners emailed in saying the same thing. They’re seeing it in their markets. What is going on?
Z: I want to offer two theories that are, I think, related, but also either one of them could go a long way to explaining this. One of them is a little bit related to what I raised on a previous episode, which is perhaps a belief in a lot of restaurants now, especially where the restaurant operator, the general manager, whomever, believes that it’s important to have a wine program because obviously wine is something we strongly associate with dining out or just eating in general, but isn’t necessarily that passionate about wine. It’s basically like, “Here’s an opportunity for us to have a high-ticket item that some people are going to gravitate towards. If the wine is priced in such a way that it dissuades some people away from wine and towards another beverage, we don’t really care, right? We’re not a wine-centric restaurant, we’re just a restaurant that has a wine program because we have to and — or not have to, but it’s a piece of hospitality.” In the same way that restaurant might not shy away from charging astronomical prices for certain other luxury goods be they caviar or truffles or whatever, they don’t really shy away from charging a lot of money for wine under the perhaps accurate, but also perhaps limiting notion that the people who want it will spend for it. “That’s just more money for us.” Again, don’t bring people into the wine program, well, who gives a sh*t? They’ll get a cocktail, they’ll get a beer, they’ll drink something and they’ll be — and that’s fine. That’s one piece. I think the other piece is that there has been a — I don’t know how else to describe it other than this weird relationship between putting wine on a menu at a certain price and I don’t know if it’s an ego thing or if it’s a belief that every wine that some — in places where the wine program is really a central part and it is something that the person running it or people running it are really proud of and invested in. At the same time, there’s this belief that every bottle of wine they bring in has to have this high price tag. Whether it’s chasing after certain accolades or whether it’s just a belief that they can’t list inexpensive wine because it makes the program look bad or something. It is really striking to me and some of it’s just greed. That’s the simplest answer, is it’s greed. It’s a belief that you have a captive audience for the most part, and especially when this is put alongside ever-escalating corkage fees. Someone who wants to drink wine with their dinner has basically the choice of spending $50 in some cases or more to have a bottle of wine that they bring in opened or pay a lot of money, over $100 almost at a minimum, on the list. You’re putting people in a difficult position where if they want to drink wine with their dinner, they’re looking at an outlay that just totally shifts the tone of their meal. Greed is, like I said, the simplest answer and maybe the only answer that is necessary, but I do think that some of it might just come out of a — I don’t know, just a lack of excitement around wine in some places, and a belief that wine is for people who have a lot of money and can afford to spend it. Let’s milk them for all their worth.
J: I was going to say, not to be cynical here, but I feel like even at the places that aren’t known for their wine programs, we’re seeing this on menus, and even when the price points are lower for dishes in a more casual place it just feels like it’s an easy way to make up for the past couple of years where restaurants have suffered so much. I think we’ve talked about this a number of times on the podcast, but with people buying their alcohol for the past couple of years, and they’re aware of this now it seems like it’s so much harder to get away with when you have consumers who are just much more savvy about margins and markup around wine specifically.
A: That’s what I think is so interesting is that we’re saying that consumers are more savvy and they should know and they know, but yet it seems to be more pervasive than it ever has been. I do wonder also, on top of what you both are saying in terms of the Covid effect and this idea of who wine’s for, if it also is that we’ve got lazy in what– If we’ve basically decided, “You know what? It’s too much to try to get an American consumer into a new region or a new grape or whatever that offers more affordability. It’s really easy when we want to sell a bottle, at least to sell the bottles of Burgundy and Napa Cab and whatever. We’re not going to put these other more obscure wines and regions on our list that are more affordable because that requires a lot more hand-selling. We don’t have a lot of people on the floor right now because we’re not finding a lot of people who want to be somms. We’re not even finding a lot of people that want to be servers. There’s still multiple open jobs. Let’s go with the tried and true. If the tried and true is expensive, it is what it is.” I read the interview we did this past week with Aldo Sohm. The dude runs one of the greatest restaurants in the world’s beverage program. Le Bernardin is arguably one of the greatest restaurants in the world and has an incredible wine program. Then he has a wine bar next door, and he is saying we need to find other regions in this interview. That we need to start looking at Spain and parts of southern Italy and Portugal and parts of South America. He is saying the prices are too high and he operates a three-star Michelin restaurant. Wait, is Le Bernardin three stars or two? I never remember. It’s four stars in The Times so that’s all that matters.
J: I think it’s three.
A: He operates one of these super-high-end tasting-menu restaurants and he’s saying, “We need to find more affordable wine.” That’s when you know it’s a real problem. When it’s being felt even there where they aren’t selling as much wine because the prices are too damn high. There has to be a way that we all decide to fix this, but the only way that I can see is this embrace of these other places. I don’t know that you can do that unless you have people who can help put the guests at ease about those regions and explain them to them, and open the wines and give them tastes and be willing to sell that wine by the glass if the consumer doesn’t like it so that you can start moving them. Beaujolais, we’ve talked about before, is a lot easier because it’s, oh, well it’s the region right next to Burgundy and it tastes so similar to Pinot Noir and it’s French and so the normal American consumers like, “Oh, it’s French, OK.” I don’t know how you do that sometimes with some of these Portuguese, Spanish, and some of the Greek wines that they can’t say the name of the grapes. They’ve never heard of the area where it is. Then we’re saying, “By the way, it tastes a lot like your favorite Cab or your favorite Pinot Noir.”
Z: I do think that one of the problems is we’re seeing price inflation, not just among the really well-known regions and wines, but it is even in these more obscure varieties and-
A: No, that’s true.
Z: -places of origin.
J: I agree.
Z: Everyone collectively decided that your glass pours have to be $15 to $22 regardless of what they cost you wholesale. I think that’s where the galling part of it is for a lot of people. We got someone writing, and I apologize, I don’t have the email in front of me, who was saying that they were seeing glass pours at restaurants near them for $14 and the bottle itself retails, not wholesales, retails for $14 nearby. People are not morons. They’re going to notice that. This is where the greed piece of it comes in-
A: To be fair, that reader was in D.C., just so everyone wants to — that reader was in D.C.
Z: OK.
A: Cool.
Z: Still, I think the point is it’s a little bit pervasive all over the place and we see this — it’s just that belief that — OK, when I ran restaurant wine programs, there was no — you get some guidance, at least in my case, you get some guidance from the higher-ups about how to structure your pricing and you have goals for what your margins are going to be and all that. I had a fair bit of leeway in how to finesse that. It meant I tried to keep my glass-pour pricing industry standard. I tried to keep my wine pricing largely industry standard. You’d mark up certain bottles a little less because they were a little more out there. I wanted them to be priced at levels where people felt they might be able to approach it. Sometimes that meant if a wine was going to be on the list and if I were going to do my standard markup and it would be $105, maybe I’d list for $95, because that seems less scary to people because it’s two digits instead of three. Sometimes it was, OK, maybe we’re going to bump the margin up a little more because this is a bottle we got a really good price on or it’s a special wine or it’s an older wine or something like that and you feel more justified, I guess, as a restaurant. I don’t think a good wine program should just have a blanket percentage or markup that it applies to everything, you should finesse that in certain ways. It does seem like a lot of restaurants and bars, and maybe it’s come out of Covid, are just kind of looking to cash in as quickly as possible. Because people are used to paying $15 for a glass of wine now, or $17, or $22, or whatever, it’s like, “We don’t care what we’re paying for it as the restaurant. That’s what our glass pour, crisp white wine goes for. Whatever it is, wherever it’s from, whatever we’re paying for it, it will be on the list for $15.” For one, that’s a short-sighted alienating way to treat your customers. If you’re not churning through new customers, and you’re looking to have regulars, it’s a detrimental approach. The other problem is it does undermine your whole wine program, because people — whether they’re acutely aware of the wholesale price or not, they are going to look at other things on your list: cocktails, beer, drinking water only, as more frankly — they’re going to seem like bargains comparatively. One of the things we’ve talked about a few times is how cocktails in particular have eaten into wine’s share of sales in restaurants. I think a big part of it is, the amount of money a restaurant charges you for a glass of wine doesn’t feel very earned. In a lot of cases, they’re really just pouring it in a glass and handing it to you. I’m not saying that doesn’t require some skill. Obviously, there’s a lot that goes on behind the scenes that people aren’t necessarily aware of, but in some restaurants, it’s not that much, really, it’s pretty lazy. A lot of restaurants, distributors, basically, write the wine list. The person who’s doing the ordering is doing 10 other jobs at the same time and they don’t really have the know-how or the wherewithal or the time to invest into building a thoughtful kind of intelligent program. It’s just like, “What do we think will sell? What is on closeout? What gets me kickbacks from the distributor?” Whatever. Whereas the cocktail, you see someone make it. It feels like a thing that the restaurant is doing that feels like, “OK, I want to spend on this.” Even if I go through and price out the ingredients, and maybe I’m like, “Huh, I could make this drink at home for $6 and it’s $17 on the wine list, or on the cocktail list rather,” but it feels earned by the restaurant, the same way that the food feels earned, they make it there. Wine is not something that’s made in the restaurant and so it’s always going to be hard to get a certain kind of person and I think more and more people, to get excited about paying crazy markups for wine when literally all that’s happening is it’s being opened and poured. Again, don’t come at me. I did it for a long time. I know that it’s more than just that, but from the perspective of the average diner, the average drinker, that’s all it appears to be
A: I’ve been thinking about this while you’ve been chatting. It’s an interesting thought experiment I want to have, which is what you’re basically saying is, the restaurant has decided that their crisp white, let’s take the crisp white perspective, is going to be $18. The reason they’re going to do that is because that is what it is. They don’t care if the wholesale price of that white wine was $8, $5, $12, $18, which is what it normally used to be. It was your wholesale price was your glass pour price, right? They don’t care. It is what it is, I’ll make the margin. They assume people won’t care but what we’re saying is that basically consumers can easily look at how much that bottle costs and do Wine-Searcher and see if they’re getting scammed. Don’t you think it should be the other way around where you gouge? With a cocktail, for the most part, at most of these restaurants, they aren’t naming — a lot of these restaurants are not naming the liquid inside.
J: Spirits.
A: That Old Fashioned could be made by a Knob Creek but it also could very easily be made by an Evan Williams or an Evan Williams Single Barrel, which are much more affordable whiskeys. It could have premium bitters in it, it could not. Do you know what I mean? You could hide all those costs a lot more and I think that’s why most consumers don’t really question cocktail prices in the first place because they’re like, “Maybe my Grey Goose Martini should be cheaper but I don’t know. I don’t know how many ounces they use. I think I know how much Grey Goose would cost. I buy it a lot but I don’t know. It looks like it fits in the glass then cool.” Like you said, “They made it so I’ll pay.” Wouldn’t that be the place where a cocktail should be in the $20s and the wine should be down under $15?
Z: You would think?
A: Yes, because the wine is where you cannot f*cking hide. I can literally Wine-Searcher that sh*t and see the price. It just seems like it’s such a flip of the place to gauge and the only way that I can answer that it’s wider is because of what Zach said at the beginning, which is just because the assumption is people who drink wine have money and people who drink wine don’t care about spending their money. Cocktails seem to be much more democratic and everyone drinks those and you don’t want to lose that business across the board because there’s a lot of people who drink cocktails who may not drink wine, and people that drink wine are used to spending it. That sucks.
J: I just think that there’s this assumption on behalf of restaurants that it’s like people are willing to pay this much money for a cocktail so why won’t they pay this much for a glass of wine. I think one of you said this. Then if they’re not going to pay for a glass of wine at this price, they’ll just have another cocktail. We’re not losing money, really, but what I think this is a problem for is this bigger conversation that we’ve been having which is that wine is losing people. The restaurants are really doing a disservice to wine by pricing this way because — we had this conversation at the office recently. A lot of us opt for cocktails instead of wine because it is a better value and it just is. Yes, someone is opening a bottle and pouring it for you versus crafting a cocktail for you which seems like it’s much more work.
Z: I want to say something here which is when I was running wine programs in particular, we would sometimes get approached — I would have relationships with mostly wineries in Washington but sometimes it would be wineries in other places through distributors that I have relationships with. They would say, “We really want a glass-pour placement in your restaurant and we’ll basically cut you a deal on the price if you agree to take five cases or something, or agree to place it for three months and we can have a — if not exclusive, we could at least have something that was beneficial to both parties.” Sometimes that was glass pour, sometimes that was bottle placement, sometimes both. One thing that was really interesting to me was at that time, all of the wineries that I interacted with, I think, without exception basically were very, very clear that they wanted me to have a minimum price that I charge. They didn’t want me to make their wine appear too inexpensive. Whether that was they didn’t want me to undercut the retail price, which I wasn’t going to charge less than retail, but they wanted it to be clearly more than retail or they wanted it to be at a certain price point. Generally, I didn’t let those people determine my pricing but I listened to them and you’re making a deal. It’s part of what you’ve got to do. It was interesting that at the time, that was their concern. They didn’t want their product to appear cheap. Now, I almost wonder if restaurants should be hearing the opposite from wineries and things like that. “You cannot charge more than X for our wine. We do not want it on your list. If you’re going to take a wine that we retail out of our winery for $35, you can’t charge $100 for it on the wine list. We’re selling it to you for $20, why are you marking it up 5 times? We don’t care that you think you can get that for it.” This has to be a mutually beneficial arrangement. Obviously, in a lot of cases, the relationship between the producer and seller especially when it’s an on-premise account is really attenuated even domestically but certainly with wines from overseas. You’re going through multiple different companies, and the person buying it and then eventually placing it on the list has no relationship with the winery. If they’re grossly inflating the cost of the wine that seller, the producer rather, has no real recourse. Maybe they say something to their importer, who says something to their distributor, who says something to the restaurant, but let’s be honest. That never happens, almost never happens. If you’re certainly in a place like Seattle where you’re dealing with a lot of local wineries or California even in New York, I would think it would behoove wineries to say, “We don’t want our wine to be so unapproachably priced on our list. We want people drinking it.” The whole point for wineries of having relationships with the restaurants, putting wines in glass-pour pricing, for the most part, was trying to get people exposed to their wine. If people won’t drink it or their only association they have with it is, “Oh, my God, that’s so expensive. I can’t afford that,” then those people are not going to be interested in those wineries. They’re not going to even be interested in those regions. It’s going to, in the end, turn people off it. That’s one thing if you’re Napa, and you have a rep and you have a cred, it’s another thing entirely if you’re an up-and-coming region. You should be really vigilant against restaurants whether they’re locally or wherever charging truly insane amounts of money for your wine.
J: I wonder if that happens.
Z: I’d be curious to know. Let us know folks, podcast@vinepair.com.
A: If you run a distributor or you’re a rep or you’re a winery owner, let us know if you’re one of the people that is saying, “Do not charge more than X for my wine.” I think that is very much one of our only solutions here. Otherwise, the wine is going to continue to be expensive and it’s going to continue to turn people off. The other thing I was thinking about is there’s so many barriers already. It’s confusing, it’s intimidating. The thing with the cocktail is, if you don’t like the cocktail that’s made for you, most people don’t have a problem saying that. I’m out with people all the time who go back to the restaurant and say, “I don’t like this. It’s too sweet,” or, “It’s too bitter,” or, “It’s too blah, blah.” The supervisor will say, “Cool. We’ll make you something else.” When you say that about a wine, a lot of times what you hear is, “That’s how it’s supposed to taste. Are you saying there’s a flaw?” “No, but I —” “That’s how it’s supposed to taste.” People get very intimidated by that because even if they’re saying, “Well, that’s how it’s supposed to taste but we’ll get you —” and the thing that should come out of their mouth is, “But we will get you another one,” or, “We can sell this bottle by the glass now. We don’t want you to be unhappy with it. We will open something else for you.” There’s a lot of fear in saying that. Getting stuck with something that is expensive, nobody wants that. No one wants to regret paying for something they don’t enjoy. The cocktail feels much easier to pay for, and if you don’t enjoy it, say something so they will make you something different.
J: Right.
A: Again, I don’t think that gets changed unless the prices come down and the whole ethos of everything around it changes. We’ve been talking about it for the last three weeks. If you have any more thoughts on this, hit us up at podcast@vinepair.com, and let us know what you think. We always appreciate it. Also, I think a lot of you listen to the credits but in case you don’t, please leave us a review, rate this on any of your podcast apps whether it be iTunes, Spotify, Stitcher, et cetera. It is what causes the platforms to surface the show to more people who are looking for things in the world of drinks and food podcasts, so that goes a very long way for us and we’d appreciate it if you would do that. Especially, if you’re people who love the show and email us about it, it’s super helpful.
J: Yes, we got a very nice review recently. Thank you.
A: We did. Thank you very much. Joanna, maybe we’ll see you on Friday, maybe we won’t.
J: Maybe.
A: Zach?
Z: I’ll be here, don’t worry.
A: Hey, man. I hope, by the time I talk to you, you’ve eaten some Spam, buddy.
Z: Sounds great.
Thanks so much for listening to the “VinePair Podcast,” the flagship podcast of the VinePair Podcast Network. If you love listening to this show or even if you don’t, but I really hope that you do, as much as we really do love making it, then please drop us a review or a rating wherever it is that you get your podcast. Whether that be iTunes, Spotify, Stitcher, anywhere.
If you are listening to this on a device right now through an app, however you got this audio, please drop a review. It really helps everyone else discover the show. And now for some totally awesome credits. So, the VinePair Podcast is recorded in our New York City headquarters and in Seattle, Washington, in Zach Geballe’s basement. It is recorded by Zach, mastered and produced by Zach. He loves all the credit. Keep giving it to him. Drop his name in the reviews. He’s going to love hearing how much you love him. It is also recorded in New York City by our tastings director, Keith Beavers, who is the managing director of the entire VinePair Podcast Network. I’d also love to give a shout-out to our editor-in-chief, Joanna Sciarrino, who joins us on every single podcast as our third and most important host.
Thank you as well to the entire VinePair staff and everyone who’s been involved in making VinePair as special as it’s become. Thanks again for listening and we’ll see you next week.
