What is it about wine?

Just had a thought. With most products, there's a brand that pretty clearly dominates, or vies with one other brand for the leading position, and then sales drop off rapidly as you move to the lower tier brands. Coffee=starbucks, soda=coke, beer is probably budweiser, console games = call of duty, facebook games = farmville. And that's awesome for the one or two companies in a leading spot and kind of sucks for everyone else - if the curves where shallower or linear-er more people could make a living creating a product that suits their own taste even if it's not the favorite, and there'd be more variety in the world, and more stuff to talk about. ("Have you tried this obscure brand of coffee? I really like it.")

And then there's wine. I have no idea what the leading brand of wine is - googling didn't seem to turn up a consistent winner - and I suspect that whatever wine does sell the most, it's not a juggernaut that's driving the other wines out of business.

Maybe I'm wrong. Maybe wines are under the same killer power law that all products have. If somebody out there could clear that up for me, I'd be grateful.

If I'm right, though, well, why is that? Why do wines have a flatter curve? 

And then let me just take a moment to 'try the whine' and say, "Why can't games be more like wine?" 

Comments

[Darius K.]

MAN that is a good question. I'll be thinking about this one for a while...

[Tim Holt]

Another thing to think about with wine is that well known brands are actually shunned. Mass market wine has a bad reputation (unless you just want to drink). It's the whole AAA vs Indie thing flipped on it's head, since the wine world has far more people who want to be indie connoisseurs than AAA guzzlers.

Beer's actually the same way in some areas of the country. Here in Oregon, Microbrews dominate. For some of us, a bar that serves Bud is a sign of a sucky bar. A bar that serves a lot of beers (on tap) you've never heard of is a potential winner.

[Bram Stolk]

Nope... the curve for wine sales/price is not flat. There is a clear dominant brand out there:

Any wine maker in the Champagne region of France can charge ten times the price of the wine maker just across the canton-border. And he'll probably sell more as well. Champaign is a premium brand, commanding premium prices.

Others can make bubbly wine, and it will probably taste just as good, but without the Champaign label, it will not sell at astronomical prices.

[anthony chen]

wine is probably more like cereal. In any case there were about 300 million cases sold in the US in 2008

Here are rankings of the top wine producers by case in 2008

http://www.winebusiness.com/wbm/?go=getArticle&dataId=54412

E&J gallo - 68 million
constellation - 59M
The wine group 44M

[Ted Fristrom]

Coke follows the highlander, there-can-be-only-one model of economics, but most things don't. In wine, and to a lesser extent beer, there are "dominant" companies that can produce a large, cheap, consistent though mediocre product (Budweiser or E&J Gallo) and then there are small artisanal companies that produce a more refined, varied product in smaller supply. That kind of competition leads to a more rugged, more interesting, economic landscape. Why do video games seem to sell more like Coke? Costs a lot to build a factory or a game, but reproduction is cheap. One could make games for connoisseurs, and I'm sure some people do, but you have to pay the same up front costs to build a product that will sell to a more exclusive customer. In addition, there's no limit on the supply, so it's never going to accumulate the same value and prestige as a rare bottle of wine. Is Activision going to artificially limit the sales of games to five licenses so that it can charge 1787 Cateau of Duty prices?

[Noah]

Speaking as a former employee for a very large American winery, your label of "wine" is just too broad to produce a single winner.

You'd have to break it down by varietals and price points. That's how the industry does it. We wouldn't look at "wine", but at say "Cabernet Sauvignon at the $10 to $20 price range" and pick a leader or winner based off of that.

In general the cheaper the price, the more you'll move. Wine that's sub $10 but over $3 for a 1.5L bottle will sell well because you can put it into a restaurant chain like Olive Garden or California Pizza Kitchen and make up a lot of money through bulk, and the quality will be good (if coming from a decent winery)

Also, at this point many wineries/brands fall under a much larger company. So, while they may thump their chest about that small French winery in Bordeaux that got a 99 from Robert Parker, in reality it's probably their cheaper merlot from a bulk California winery that sources all over Lodi at under $10 a bottle that generates the bulk of their income.

Most of the top American wineries amassed their money through jug wine back in the day.

[greggman]

It would be nice if the games market was more like the wine market but it's kind of hard to compare them directly given that wine is a consumable. 1 bottle is what, 4 glasses? 6? 8 at most. That means if you're a wine drinker you're generally going to go through several bottles a week. How many games do you go through a week? If people played as many games as they bought bottles of wine I would guess there would be a lot more artisanal games.