A Flexible Business Model Combines Seasoned Business Acumen With Consistently Excellent Willamette Valley Wines: A Profile of Oregon’s Loosen Christopher Wines
- "And now, time for Final Jeopardy. The category is: premium wine. The answer is: Spätburgunder is red wine grape planted widely in many parts of Germany. In the New World, the grape is known as this."
- "What is Pinot Noir, Alex?"
- "That is Correct!”
This playful dramatization brings light to a little-known fact in the wine industry: Germany is the world’s third largest producer of Pinot Noir (Spätburgunder) in the world. Grown extensively in the Pfalz region, the grape is regarded as having more structure than its New World counterparts and is less fruit-forward.
At the high end of the quality scale, some of these wines are compared to those of the Burgundy region of France (Spätburgunder, when translated means late Burgundian). But at the other end of the quality spectrum, the grape is quite inexpensive to grow and makes a delicious everyday drinking wine.
A compelling business opportunity surfaced back in 2003-04 when the Oregon region — known for its Pinot Noir production — was generating very small vintages and there was huge demand for more fruit. That’s when winemaking legend Ernst Loosen (pronounced loh-zen) teamed up with J. Christopher Wines to craft an elegant Pinot Noir. But the juice didn’t come from Oregon … it came from the Pfalz region of Germany!
Not only was the wine wonderfully well-received, the venture nailed the price point. One bottle of the wine (under the label Two Worlds) could be purchased at the Portland Whole Foods for a mere $12. It is 90 percent Spätburgunder and 10 percent Oregon Pinot Noir. The easy-drinking wine offers the purity of fruit and structure from sunny Pfalz with the deeper fruit, strong tannins and firmer backbone from the juice of J. Christopher’s cellars.
It also draws attention to how market forces in the wine business often force a strategic shift that can carry risk, but how it can often lead to unexpected — and profitable — results.
The Difference of a Few Years Can Make
The collaboration of the Loosen family with American winemakers is familiar territory. Ernie Loosen brought his world famous Riesling-making talent to a joint venture with Chateau St. Michelle in Washington State. Today, the Eroica Riesling continues to receive rave reviews.
In February of this year, J. Christopher Wines and Dr. Loosen Wines announced a new venture to make Oregon Pinot Noir. In contrast to the 2004 vintage, Pinot Noir grapes have been much more widely available in recent years. In fact, some winemakers believe there is strong supply of Pinot Noir wine in today’s market.
Once again, the market realities forced a new strategic focus among resourceful winemakers. The current reality prompted Dr. Loosen and Jay Somers (the owner and winemaker at J. Christopher Wines) to form a new venture to produce wines under the established J. Christopher brand.
The venture will be producing wine on a recently-purchased 40-acre property and will include the following wines as well as limited bottlings of single vineyard wines: J. Christopher Willamette Valley Pinot Noir, Dundee Hills Pinot Noir, and Willamette Valley Sauvignon Blanc.
In addition, a finely-selected, limited-production Willamette Valley Pinot Noir — with the romantic moniker Appassionata — is already available. To assemble the wine, Ernst and Jay tasted through all of the barrels of the J. Christopher cellars and selected the distinctive combination of clones, terroirs and cooperages to produce an elegant Pinot Noir with powerful Oregon fruit and a fine Old World structure. (Note the artwork of the gorgeous label.)
The wine is a top of the line special bottling, and retails for $75. The 2006 was released for the first time in March of this year, but only 100 cases were made, so you’d better act fast!
While the business insight around the Two Worlds label focused on entry-level wine consumers, the business logic behind the new venture focuses on premium wine buyers in the global wine market. One of the great assets of the Dr. Loosen Wines is its incredible distribution network.
As Kirk Wille, the Vice President of Loosen Brothers USA pointed out, "Today, making the wine is the easy part… the issue is finding customers!" Dr. Loosen Wines distribution network extends to 65 different countries and will be a powerful way to grow the J. Christopher brand around the world.
What’s Next, Ode to Joy?
With names like Eroica and Appassionata for wines — both of which are the names of music compositions by Ludwig van Beethoven — the obvious question is whether Loosen Christopher Wines will include an Ode to Joy anytime soon.
Kirk Wille’s response to that was perfect. "Ernie Loosen is an Allman Brothers kind of guy… Appassionata is what he is all about — it means passion!"
Taken as a whole, the Loosen Christopher story illustrates how quality winemaking and creative wine marketing are two sides of the same coin and how the value of that currency is always a function of excellent craftsmanship and courageous business management.
Auf Wiedersehen!
Wine Details:
2007 Dr. Loosen & J. Christopher Two Worlds.
90 percent German Pinot Noir (Spatburgunder) and 10 percent Oregon Pinot Noir.
Price: $12 per 750ml bottle.
2006 Dr. Loosen & J. Christopher Appassionata Pinot Noir.
Willamette Valley, Oregon.
Price: $75 per 750ml bottle
www.jchristopherwines.com
www.SVBwines.com
Silicon Valley Bank's Wine Division publishes Liquid Assets as a quarterly column featuring visionary winemakers and wineries. As the leading provider of financial services to wineries and vineyards in the western United States, we are using our unique perspective to help our readers further understand winemaking and the innovative vintners who create some of the world's premium wines.
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