Rethinking Group Tastings

You all know the group. Maybe you've even been a part of the group. Fourteen friends -- or maybe family -- out for a day in wine country. The van has been reserved for the day, so everyone can partake in the tastings. Your friend -- or cousin -- Phil is the master of ceremonies, and the life of the party. Most of the group likes wine, but only a few are really into the details. For everyone else, it's a fun day out, a chance to socialize and catch up. A few wineries make a great backdrop for the day's socializing.  Look familiar?

Wine Group Tasting Stock Photo

For a winery tasting room, or for our more serious visitors, these groups are a challenge.  They can come unexpectedly and monopolize the attention of one of our tasting room servers.  They tend to be loud and mostly interested in interacting with each other.  And while we can always find a way to fit another 2 or 4 people into one of our tasting bars, fitting in a new group of 10 or 14 isn't always possible.  Our focus has been on making sure that the core visitors who are our bread and butter are well taken care of, and over the last year or so we've been letting groups know that while we'd love to host them at a time when the tasting room is relatively quiet, we often can't accommodate large groups during our busy times.

Why? If we're looking at what the relative benefit is to us of a large group vs. a more traditional couple or party of 4, it's not close.  On average, large groups buy about 20% as much wine per person as smaller parties. We comp our tasting fee on the purchase of even one bottle, which has meant that less than 10% of our traditional tasters even pay it.  Historically, looking at our large groups, around 85% end up paying the tasting fee. While the tasting fee (barely) covers our costs, it's hardly possible to base a business on charging customers $15 for an hour of entertainment plus 6-8 tastes (between 1/4 and 1/3 of a bottle) of wine that averages $40/bottle.

At the same time, I hated the thought that we were turning away potential new customers.  Sure, they might not buy anything on this visit, but who's more likely to buy later -- either on a return trip to Paso Robles, or when they see Tablas Creek on a restaurant list or retail shelf -- someone who's spent a fun hour out here, or someone who's been told that we couldn't accommodate them and then went and had a fun hour at some other local winery?

So, while I knew that we were making the right decision about where to prioritize our efforts, I was never happy with the outcome.  Until now.

Those of you who visited before March of 2011 will remember our old tasting room, on the west side of our winery building. The below photo is from 2006 or thereabouts, with a second room (off-camera to the right) that had in very early days (pre-2005) been our conference room holding three additional tasting bars:

Tablas Creek Tasting Room Interior

We decommissioned this tasting room when we moved into our current space in 2011.  At that point, we turned the conference room back into a conference room and the original tasting room went back to being the office entrance it was between 1997 and 2002 while we waited for inspiration on what to use it for.

That inspiration is here.  Please welcome our two new group tasting spaces:

Old New TR Set

Seated Room Set

These spaces give us two options, one seated and one standing, for hosting groups. It gives each group a dedicated pourer and its own space. It allows them to be as focused (or as unfocused) as they like without impacting anyone else's experience.  It keeps their mini-buses and limousines from displacing our customers' cars from our parking lot.  And it allows us to keep our main tasting room focused on the experience of the couples and smaller groups who are our most important customers.

These new rooms are available to groups of 10 or more on weekends.  We ask that groups make a reservation (you would, wouldn't you?) but if we get a walk-in group and have the space available, we'll bring them back to the group space.  All the details for our group tastings, including tasting fees and available times, can be found on our Visiting Page.

I hope that this will make everyone's experience better, allow us to continue to take great, personal care of our visitors, and mean that the times when we have to say we just can't accommodate someone who wants to come visit are truly few and far between.  Meanwhile, if you've been a part of a particularly good group tasting somewhere, or you have any suggestions for our new program, I'd love you to leave a comment.

Customer service lessons from an overcrowded restaurant

On the Monday between Christmas and New Year's, I called into a favorite local restaurant from my 8-year-old's soccer practice to get takeout. I had volunteered to provide dinner that night for the large group of extended family who were in town for the weekend, who were relaxing and watching football back at my house while I collected Sebastian. The restaurant I chose isn't fancy, but it's the kind of solid neighborhood place that forms the backbone of a lot of communities. Good food, an unfailingly helpful staff and no fuss. We eat there (or order from there) a lot.


This experience was pretty much a nightmare. When I called, I was asked if I could hold. Sure, no problem. But when no one came back to the phone for a minute, then two, then five, it became clear that whoever had answered had put down the phone to take care of whatever else she was working on, and then forgotten about me. I hung up, and called back. Busy. I tried again. Busy. Over the next twenty minutes, I called another half-dozen times, getting a busy signal each time. The phone was evidently still off the hook. I was about to abandon the attempt -- worried at this point I wouldn't have any food for the assembled dozen people, but without a plan B I could think of -- when the phone rang through, and was picked up. I ordered, and she let me know that because they were so busy, I should count on a half-hour for the food to be ready.

I had been planning to pick up the food on my way back home from practice, but at this point, the ordering had taken so long that I figured I should drop Sebastian back home to play with his cousins and then head back out to get the food. And it's a good thing I did. I arrived at the restaurant about a half-hour after ordering, and it was absolutely slammed. Every table was full, there were people waiting at the entrance, and the bar was full of patrons waiting for orders they'd called in. It took another twenty minutes (which felt like an hour, at this point) before I got my food and headed home to a very hungry household.

I'm a regular customer, and knew enough to cut them some slack after dozens of good experiences. But, I thought, what if I had been one of those people in from out of town, and this was my first visit? I wouldn't be writing this blog; I'd be writing a review on Yelp (if I were that sort of person) or at least telling my dozen or so assembled friends and family what a disorganized mess the restaurant was.

I realized later that this experience held two clear lessons for restaurants, winery tasting rooms, or really any other retail business with an ebb and flow of customers.

  1. Keep good records, and use them. Clearly, the restaurant was surprised by the traffic they saw on this Monday night. Should they have been? Probably not. That week is always one of our busiest of the year in the tasting room, with what feels like an entire week of Saturdays. The restaurant has been there for several years, so they should have data from past Christmases. Maybe they had someone call in sick. Or maybe things sequenced badly for them, with several big groups arriving all at once. Things happen. But they're a lot less likely to take you by surprise if you're looking at past history. This year, we saw 931 people at the Tablas Creek tasting room that very week. That was a lot. But since we had 836 the same week last year, we were prepared. Similarly, after being blindsided by exceptionally busy weekends thanks to other wineries hosting wine club events, we started a calendar in conjunction with other wineries out near us that we all share. Now, we know when to expect the overflow from an event at Justin, or Halter Ranch, or Adelaida.
  2. Staff for your peak times.It's easy and logical to look at your staffing costs and decide you can save a little by aiming to be appropriately staffed when you're averagely busy. But I think it's usually a mistake. Customer traffic rarely comes in an even flow. It comes in rushes and pauses, and a rush when you're unprepared can put you behind for some time after. But, more importantly, if you're staffed for your average traffic you're guaranteed to be providing the worst service when you have the most people there. Far better, in my opinion, is staffing for when you're busy, and being creative with your staff so they're not unproductive when customer traffic is light.

These lessons were always important. Research has shown that a bad customer experience gets retold many more times than a good one. But with the increasing popularity of review sites like Yelp and TripAdvisor, and the easy sharing of information over social media, it's more important than ever. Go back to my initial experience. If I had written this up on Yelp, how many customers do you think would have read it and decided not to chance a first visit? How many of those customers might have become regulars? Suddenly, the cost of the extra person to work the floor, or answer the phones, doesn't seem so substantial.

The 11th annual Tablas Creek Vineyard pig roast dinner

By: Lauren Phelps
We hosted our 11th annual Pig Roast dinner on Saturday evening, August 15th and wanted to share some of the images and a bit of information about this event.  Over 120 guests joined us for a family-style meal on our terraced patio with wines paired from our cellar.  The meal was collaboratively prepared by our very own Winemaker, Neil Collins and local Chef, Jeffery Scott

Tablas_Creek_20150815_182833_2000It was a beautiful evening, and relatively mild for August in Paso Robles.  As the sun set behind the tasting room the breeze brought in cool marine air.

Tablas_Creek_20150815_193044_2000Our very own Darren Delmore and his brother who make up the duo, The Delmore Boys set the tone with their Americana guitar tunes.

Tablas_Creek_20150815_190304_2000Many Tablas Creek team members and their families attended the event including, Neil Collins, Chelsea Franchi, Jason Haas and Nicole Getty.

Tablas_Creek_20150815_190617_2000This year, Neil roasted the 350 pound estate-grown pig for over 12 hours using a modified iron-cross roaster with oak from our property. Chef, Jeffery Scott contributed incredible appetizers and sides using locally-sourced and organic ingredients.






















We paired the meal with the 2014 Grenache Blanc, our 2014 Dianthus, the newly released 2013 Mourvedre and our flagship red wine, the 2011 Esprit de Tablas, that we brought up from the library.


We'd like to thank all of the guests who joined us and invite you to view additional photos by Patrick Ibarra Photography on our Pig Roast Dinner Flickr Album

Also, we are thrilled to announce that the Cooking Channel's, Man Fire Food will be airing an episode on September 15th highlighting our pig roast dinners! We're really looking forward to watching it.

The date for the 2016 pig roast has not been set yet and we recommend periodically checking our Upcoming Events page for more details.  We give priority invitation to our wine club members and seating is very limited.

Through the glass doors: 360° views of Tablas Creek Vineyard, courtesy of Google

By Lauren Phelps

When you have a limited amount of time to visit a new place for example, how do you decide where to visit?  If you’re anything like me, you type the name of the location into Google and see what pops up.  Well, today if you Google "Tablas Creek Vineyard", a new feature is available that gives you an insider's look (literally) into the tasting room, tank room and surrounding grounds which should help visitors fine-tune their itinerary.

The new tool is a part of Google Maps, which has expanded beyond the basics of maps and directions in recent years.  First they added reviews of the businesses, through Google+.  Then, they added the option to "see photos", which are taken from our Google+ business page.  Now, they've added a new option, to "see inside":

Search Result_475

Once you've clicked on this option (try it here full screen, or use the smaller windows below), you can cruise virtually around the main tasting room, venture into the private and semi-private tasting rooms, and even wander our patio.  You can rotate your view 360° in any of the rooms or locations.  It's a fun and novel way to get a sense of what you'll see when you visit.  An interior view:

From the outside:

Another benefit of creating the virtual tour is the still photography that the team that Google sent out (Evolving Photography) took and uploaded to our Google+ account.  A few of my favorites are below:

Tablas Creek Vineyards 17
Tablas Creek Vineyards 27_475
In many ways, what Google did overlaps the Virtual Tour that we produced in-house a couple of years ago, though the virtual tour takes people out into the cellar and vineyard, and adds narration by our Winemaker, Neil Collins.  But the benefit of having this tour be a part of the Google page where people searching for us land is enormous.  Even though we love it, we've struggled to get more than a few dozen views per week on our virtual tour.  We're hopeful that lots more eyes will see Google's "see inside".

Our new view is part of a concerted effort by Google; Wine Spectator posted an article today noting that we're one of 78 wineries (and 10 breweries) in California for whom Google has completed this expansion of their "street view" footprint.

We hope that the Google Tour will join our Virtual Tour as interesting and useful tools that will give potential visitors another reason to visit Tablas Creek Vineyard.  Please, let us know what you think.

A Memorable Reserve Tasting

By John Morris

Last week I hosted a Reserve Tasting for a unique group, which included a long time, fervid VINsider and three of her friends, as well as a couple who’d never visited before and didn’t know much about Tablas Creek.  It was a terrific tasting, one I think I enjoyed as much as our guests.  As the tasting room has grown, I’m less apt to find myself pouring for guests, as I have to focus on other things, but this was a reminder of why I came to work here in the first place, and what’s special about Tablas Creek.

[For some background, we began offering a seated Reserve Tasting in our private room just over a year ago.  It seemed a perfect opportunity to show off some of the library wines we’d been saving, and an answer to the queries we'd begun receiving for an elevated experience.  We offer this twice daily, at 11:30 and 3:00 every day except for Saturday, when we offer it at 10:00 only.  We encourage appointments, as we can accommodate a maximum of eight guests per tasting, but are happy to take walk-ins if space is available. We have details, including cost and how to reserve, on the Visiting Us section of our Web site.]

My favorite part of this format, aside from the opportunity to taste older wines, is the leisurely pace.   Watching guests truly get the wines in a way they might not without the vertical nature of the tasting is a huge kick.

Tablas Creek Vineyards 11_500 pixThe private tasting room where we host our reserve tastings 

The first order of business was introducing the two parties as they seated themselves at the bar, out of the bustle of the main tasting room.  We find this makes it easier to speak to the group as a whole, and people often become fast friends by the end of this tasting.   Our proud club member was delighted to take the newcomers under her wing and sing the praises of Tablas Creek, which made my job fun.

The focus is on our flagship wines, with both current and library Esprit whites and reds shown and discussed.  The tasting this day included our 2012 Esprit de Tablas Blanc, 2005 Esprit de Beaucastel Blanc, 2012 Esprit de Tablas, 2010 Esprit de Beaucastel, 2006 Esprit de Beaucastel, and a special treat, the 2011 Panoplie.  In addition to these wines, we encourage guests to choose a couple of other wines to round out the tasting.

This day was quite warm, an early indication of the summer ahead, so I suggested we all start with the crisp 2014 Vermentino and follow with 2014 Dianthus Rosé before getting to the main event.  Everybody was on board with this suggestion, so I opened fresh bottles of these two wines to whet the palate for what was to come.  I've always loved the Vermentino for summertime drinking, and this vintage is no exception, crisp and fresh but with a little extra lushness characteristic of the 2014 vintage.  Enjoying the wine sparked a discussion of why we have Vermentino planted here, which led me into the story of Tablas Creek, the search for the proper site, and how we imported clones from Chateau de Beaucastel.  We next tasted the remarkable Dianthus Rosé, perhaps my favorite vintage to date, which we savored as we continued the discussion.

Picture1The mise en scene, with two of the showcase wines

The first wine on our list for the day, the magnificent 2012 Esprit de Tablas Blanc, was showing beautifully, with the early promise of beeswax, honey and a gorgeous salinity.  Sometimes it's difficult to convince guests that this wine will age and evolve for many years, but the silence that came over everyone as we next tasted the 2005 Esprit de Beaucastel Blanc left no doubt that the point was well made here.

And so it went as we tasted through three red Esprit vintages, starting with the youthful 2012 and watching secondary characteristics arrive and flavors deepen with the 2010 and 2006, and then finally the Panoplie, appreciating the wines that the Haas' and Perrins came here to make, comparing and contrasting, discussing the merits of the different vintages, and thoroughly enjoying each other’s company. 

We hope you have the opportunity to treat yourself and take advantage of this special experience on one of your visits.   With questions, or to reserve your seat for this tasting, please contact or call 805.237.1231 x45.  We have some corks we’d like to pull with you.

John Morris has been Tablas Creek's Tasting Room Manager since 2007

The Enduring Effects of Sideways, 10 Years Later

SidewaysAlmost exactly ten years ago, on September 13th, 2004, the film Sideways debuted at the Toronto International Film Festival.  A month later, it made its US debut on four screens, and by the following spring this black comedy made for around $12 million had grossed an unlikely $71 million in the domestic box office, earned five Oscar nominations (including a "Best Adapted Screenplay" win for writers Alexander Paine and Jim Taylor) and provided a wide audience with their first experience of wine tourism.

In the couple of years after the movie's release, Santa Barbara's wine country was inundated with Sideways-loving tourists.  This customer bonanza was not an unadulterated positive; many of these visitors were less serious wine buyers than the pre-movie average, and some of the pre-movie regulars were sufficiently turned off by the crowds to explore other regions.  We saw many of these refugees in Paso Robles in 2005 and 2006, and were happy to introduce them to our wines.  These effects slowed in the late 2000s, and now the "as seen in Sideways" signs that remain outside a few Santa Ynez wineries seem a little wistful.  

Ten years after the film's release, we in the wine industry take many of the film's impacts on the American wine market for granted.  You don't hear many people talk about the "Sideways effect".  But I wanted to take a moment to look back at how dramatic and lasting the effects of Sideways have been -- even for those of us who were not at the movie's epicenter.  These include:

  • Steeper increases in American wine consumption.  In 2003, the American per capita consumption of wine (2.20 gallons per year) was essentially unchanged from what it had been two decades earlier.  Per capita consumption declined through the late 1980s and early 1990s before beginning a slow climb.  Between 1994 and 2004, per capita wine consumption in the United States increased an average of 2.7% per year.  In 2005, the year Sideways saw American theaters, it grew 3.5%: 30% larger than the average annual increase over the previous decade.  And that growth has continued essentially uninterrupted since then, through recession and recovery, to its 2012 total of 2.73 gallons per resident.
  • Increases in prices of California wine.  In 2004, the average case of American wine sold for $68.30, a figure nearly itentical over the previous five years.  In 2005, that average price jumped 8% to $73.60.  It jumped another 6.5% (to $78.38) the next year, and today sits at $89.44, despite sales volumes 22% higher today than 2003.  Put another way, over the last decade, the quantity of California wine sold in the United States has increased 22% and the price per case has increased 31%.  Taken together, the value of California wine sold domestically has increased some 60% in the last decade.
  • Rapid development of California's (and America's) tasting room culture.  Sideways, despite the misanthropic tendencies of its male leads, made it cool to go out and visit wineries.  This was not happening in a vacuum, and was part of a longer trend, but I do think it played an important additional role.  Industry-wide data about tasting room visits is spotty and unreliable.  But at Tablas Creek, we saw a staggering increase in our traffic in 2005, which increased by more than 6000 visitors over the 9200 we saw in 2004 (an increase of 70%).  Yes, we were in a period of explosive growth at Tablas Creek and in Paso Robles, but the next year, by comparison, with all the same factors in place, we saw an increase of 4500 (an increase of 29%).  That 6000 customer increase is our largest in absolute numbers in our history: larger even than the increase in 2003, our first full year with our tasting room open.  And this increase in traffic led to increased sales, which set us up for our first-ever profitable year in 2006.  Would our traffic have increased in 2005 had Sideways not come out?  Of course.  Would it have increased by 6000?  It seems unlikely. 
  • Explosive growth in small wineries.  In the decade since 2003, California has seen the number of bonded wineries grow 119%, from 1870 to 4100.  Most of these wineries are small; wine production in America has grown over the same period by just 22%, which means that the average California winery now is half the size it was in 2003.  These small wineries nearly all subsist on direct sales through their tasting rooms rather than the three-tier system.  So, in that way, it is in part thanks to Sideways that many of these wineries have been able to thrive.  But I would submit that in its romantic depictions of California wine culture and its focus on the beauty of California's wine country, the idea of becoming a part of this wine community gained appeal.
  • Expansion of national recognition of Central Coast.  Paso Robles had only a cameo in Sideways, which was set in Santa Barbara's wine country.  But nevertheless, the fact that the movie was set in the Central Coast rather than in the better-known Napa and Sonoma valleys played a significant role in helping the American wine consuming public understand that there was elite wine being made here.  I remember, in the early 2000's, going out to sell Tablas Creek and having to explain with some frequency that it wasn't in Napa, but was instead in the Central Coast, and then what and where the Central Coast was.  When Sideways came out, these conversations were nearly all simplified into "oh, that's Sideways country ... no, not quite, the next region north ... oh, OK". And in the last five years, I've barely had to have this conversation.  Of course, Sideways was not the only source of exposure for the Central Coast in the mid-2000s; the area received loads of attention from the wine press, most notably Robert Parker.  But voices like Parker's, influential though they are, reach some tens of thousands of readers, mostly already wine-savvy.  Sideways reached millions.
  • The rise of Pinot Noir and the fall of Merlot.  In one of the movie's most famous scenes, Miles uses Merlot as a proxy for an uneducated drinker's red wine of choice.  This line sent American sales of Merlot into a tailspin from which they still haven't recovered: I had a wine buyer ask me just last week when I thought Merlot would recover from its Sideways-inflicted wounds.  At the same time, Pinot Noir, which Sideways exalts as the intelligent wine lover's drink of choice, saw its fortunes skyrocket.  An academic study by researchers at Sonoma State University and published in 2009 in the Journal of Wine Economics demonstrates the power of these effects, although it concludes that "the positive impact on Pinot Noir appears greater than the negative impact on Merlot", especially higher-end Merlot, which is in keeping with the general increased interest in higher-end wines after the movie's release.

It doesn't seem to me like any of these trends (except maybe the antipathy toward Merlot, given America's love for an underdog) are likely to regress any time soon.  America has become the largest wine-consuming country in the world, and our relatively slight per capita consumption (compared to countries like France and Italy, at least) gives us room to grow.  What's more, the fact that much of the growth California's wine community seen has come in the high-end, winery-direct segment suggests that future growth will support the development of many more smaller, higher-end wineries.

Would this have happened without Sideways?  Perhaps.  But I think all of us involved in making, selling, or drinking California wine should plan on raising a glass this Saturday to the success of this quirky movie.  And if you're feeling subversive, go ahead and make it a Merlot.

Game Theory, the Prisoner's Dilemma and... Winery Membership Organizations, Part 1

Game theory describes a branch of science at the intersection of economics, psychology and mathematics which explores models of interaction between rational actors, seeking to explain why and when these actors (be they individuals, companies or even nations) will choose to cooperate or to betray each other.  Many of these games are iterative, a fancy way of saying that they happen again and again, like many actions in life, where the actors can learn from their previous actions and the previous actions of their competitors.

One of the classic examples of game theory is the prisoner's dilemma.  Imagine the situation where two co-conspirators are arrested on light evidence, and each independently offered the opportunity to inform on the other in return for escaping jail time.  If neither chooses to inform, the prosecution doesn't have much of a case and so both get light sentences (say, 1 year).  If both choose to inform, both get moderate sentences (say, 3 years).  If one chooses to inform and the other doesn't, the one who informs gets no jail time, but the one who doesn't, and sees his co-conspirator testify against him, gets 5 years.  You can set up the four possible actions in a grid:

 A TestifiesA Stays Silent
B Testifies A gets 3 years
B gets 3 years
A gets 5 years
B gets 0 years
B Stays Silent A gets 0 years
B gets 5 years
A gets 1 year
B gets 1 year

At first glance, the actions that the actors should take in this game seem pretty clear: whatever one prisoner does, the other comes out better if he testifies, serving no time (vs. 1 year) if the other person stays silent, and 3 years (vs. 5 years) if the other prisoner testifies. And yet the best outcome for the duo happens if both behave irrationally (or perhaps trustingly) while the worst outcome occurs when both behave rationally (or self-interestedly).  Real-world applications of this abound, from arms reduction treaties to curbs on greenhouse gases to the production of individual countries in the OPEC oil cartel.

Graphic courtesy Wikimedia Commons, which has a great interactive Prisoner's Dilemma
example -- from which the screenshot above was taken -- here.

How is this applicable to wine associations?  I'm happy you asked.  I've been spending a lot of my time thinking of this recently thanks to my positions on the board of directors of two organizations: the Paso Robles Wine Country Alliance (PRWCA) and the Rhone Rangers.  In both cases, I believe that the organizations provide a valuable service to their members, but there are significant free-rider problems that discourage membership.  Think about it this way.  If the Rhone Rangers is successful in its marketing and makes Syrah easier to sell, all Syrah producers benefit, not just the ones who are members.  Similarly, if the PRWCA is successful in its promotion and brings more people to area tasting rooms, or raises the profile of Paso Robles so its wines sell better off retail shelves and wine lists, any Paso Robles winery will benefit, whether or not they have paid their membership dues.

And the dues, for the PRWCA at least, are not cheap.  We've had two important local wineries drop out of the alliance this year, each saying that they were going to reallocate their marketing dollars to efforts that more directly benefited their bottom lines.  These decisions shot a significant (though not crippling) hole through the PRWCA marketing budget.  Were the wineries behaving rationally?  Actually, yes, they almost certainly were, though if their behavior was generalized everyone, including them, would be worse off.  It's a prisoner's dilemma-type example!

The main reason that wineries band together is to gain efficiency with the money they spend.  It's generally accepted that an advertising campaign gains efficiency with repetition and with consistency.  So, a single marketing campaign, well targeted and well run, is typically more effective at driving behavior than ten different advertising campaigns each one-tenth the size of the original campaign.  And the PRWCA gains additional efficiency because of its expertise -- unlikely to be found in-house at any individual winery -- both because of the people running it (thank you, Jennifer Porter) and because of the outside consultants it is able to afford.

Let's look at an example that will require a little math. I'll round the numbers to help them make sense, but it doesn't really matter what the numbers are: the conclusion still holds, as long as we agree that wineries are unlikely to be as efficient spending individually as the group would be spending their money in a coordinated campaign. For ease of calculation, I will assume that there is a 50% loss in overall spending efficiency when a winery splits their money from the group's to spend it individually.  And we'll round numbers to 200 wineries, with a contribution of $5000 each (leaving a total budget of $1,000,000).  I'll look only at the power of advertising to drive people to local tasting rooms, and assume that each visitor makes 5 tasting room visits when they're in town, and assume that the PRWCA gets one person to make the decision to come to town for each $5 they spend.

OK, back to specifics.  Let's look at the impact of the PRWCA's spending of $5000 -- one winery's portion of the total budget -- as a part of their master marketing campaign.  This $5000 brings 1000 customers into town.  These customers make 5 visits each, or 5,000 visits total, split among the 200 wineries.  Each winery receives 25 of these tasting room visits. 

Now, let's look at the scenario where Winery X takes the $5000 that they were going to give to the PRWCA and reallocates it to running radio ads in Fresno, Bakersfield and Orange County.  This advertising is only 50% as efficient as the PRWCA's marketing, so the winery might expect to pay $10 per customer (double the PRWCA's cost).  But the people that this advertising drives to Paso Robles will all start at Winery X's tasting room.  So they get 500 visits for their $5000.  Other tasting rooms in the region still benefit, as these visitors make on average 4 more visits to other tasting rooms when they're in town.  But those 500 customers, who make their additional 2,000 total visits to other Paso Robles tasting rooms, account for only about 10 new visits to each of the other 199 wineries -- less than they would have each received had the same money been spent by the PRWCA.  So Winery X ends up 475 customers ahead, whereas every other winery in the area ends up 15 customers behind.  Winery X is behaving rationally, and can even point to the fact that its advertising is helping their neighbors gets customers.

Like in the prisoner's dilemma example, the problem comes in the aggregate.  What seems like a small loss per other winery looks a lot larger when you multiply that loss by all the wineries affected: the region loses 2,985 tasting room visits from the 199 other wineries, and only gains 475 for Winery X.

If every winery were to make the same decision to spend their $5000 individually, with the same results, they too would get 500 customers to start in their tasting room, and would each contribute 2000 other tasting room visits to the region.  Across the 200 wineries, that pool grows to 400,000 visits.  Divided equally, each winery gets 2000 of these, plus the 500 from the advertising they paid for themselves.  That's 2,500 customers total.  If the same $1,000,000 had been spent by the PRWCA, it produces 200,000 customers who make 1,000,000 visits total: or 5,000 visits per winery.  By spending their money rationally (an economist might equally say selfishly) they have cut their total number of customers in half.

Of course, not every winery makes this decision.  And that's the most frustrating thing for those of us who do contribute to the group's spending.  Winery X receives most of the benefits of the marketing that an organization like the PRWCA is doing with the member wineries' money... whether or not they are members.  Sure, there are a few ways that they lose out: they're not on the organization's printed map; they're not included in the group's media outreach; they're not a part of the trade outreach that the organization does; and they lose a modicum of goodwill from their neighbors.  I actually think that these benefits on their own probably pay for the costs of membership.  But if their principal driver of revenue is their tasting room traffic, they still probably come out ahead, at least in the short term.

How does one quantify the benefits that do accrue directly to the members from their membership?  And how does a regional organization best respond to this? Game theory has answers for this, too.  I explore how to quantify the value of membership in part 2 and will delve into game theory's suggestions for how an organization should respond to those who drop out in part 3.

Is the bloom off the user review site rose?

Last March, I wrote the post Has TripAdvisor overtaken Yelp for winery visitors, suggesting that of the two major user-review Web sites, TripAdvisor seemed to be replacing Yelp as the preferred forum for people writing user reviews of Paso Robles wineries.  The graphic I included in that post showed a pretty dramatic shift over time:

Reviews by Site

The graph also shows a steady increase in the number of user reviews posted for Tablas Creek on the two sites, from 10 in 2008 to 15 in 2009 to 22 in 2010 and 42 in 2011.  With the first quarter of 2012 showing as our busiest quarter yet for user reviews (18) I fully expected to see continued growth.  But something happened around the middle of last year, and while our annual total (63) was still our highest ever, the quarterly total peaked in the second quarter at 25, then declined to 13 in the third quarter and just 7 in the fourth quarter.  I have gone from checking the sites daily for new reviews to now checking only every week or so, and getting used to seeing the same months-old reviews I saw last time.  The curve looks a little different now. To smooth out some of the noise, I've added a rolling average, which averages each quarter with the quarters before and after:

User Reviews Trend thru 2012

It's worth noting that my conclusion that TripAdvisor -- which to most wineries at the time was much less salient than Yelp -- was a player to watch turned out to be true. TripAdvisor tallied nearly three times the number of reviews of Tablas Creek as did Yelp in 2012.  But by sometime around mid-fall the flood of user reviews had turned to a trickle.

I was curious to know whether what we were seeing, both in the drop in user reviews at the end of 2012 and the dramatic shift toward TripAdvisor and away from Yelp, was standard for our area.  So, I picked three other popular, well-established Paso Robles wineries (Justin, Adelaida and Eberle) and took a look at what they'd seen.  I found that the shift toward TripAdvisor and away from Yelp is real, and dramatic.  In 2011, the four wineries (including us) showed 133 reviews from Yelp and 44 from TripAdvisor.  In 2012, Yelp reviews declined 34% to 88, while TripAdvisor reviews grew 390% to 216.

And I found that the dip in reviews I'd noticed in the second half of last year was echoed by our neighbors, though we saw a larger decline than most.  Here are the four wineries' results for 2011 and 2012, using a stacked area graph that allows you to get a good sense of the aggregate:

User Reviews Four Wineries 2011-2012

My first thought was that this could be explained by the number of customers visiting Paso Robles.  After all, the summer season is typically the busiest one in Paso Robles, and the winter the quietest.  But when I looked deeper, I found that at least at Tablas Creek our tasting room traffic doesn't vary that much by quarter.  Our smallest quarter last year was indeed the fourth quarter, but at 6880 visitors it was only 12% less busy than our busiest (the third quarter, at 7815).  I don't have any reason to think that our traffic trend differs significantly from the other wineries in the area, so I tried dividing the total number of reviews for each quarter by that quarter's traffic.  The results show that per Tablas Creek customer, we are seeing a decline in user reviews submitted for the four wineries:

User Reviews per Customer

There are few possible ways of explaining away the development, none of which I find particularly convincing.

  • Perhaps there is a different type of customer who visits in the summer months, a younger, more tech-savvy customer, who is more likely to post a review on Yelp or TripAdvisor.  Maybe, but If you look at the results for 2011, the two summer quarters showed the lowest percentage of reviews per tasting room visitor. Why would this reverse itself in 2012?
  • Perhaps there is something about the four wineries that I chose that makes us all subject to some trend that is out of step with what's really happening.  This is possible, but seems far-fetched.  Other than that we're all in Paso Robles and all of roughly similar scales, we represent wineries that are in different parts of the AVA. Could, say, newer... or smaller... or larger wineries have been getting more reviews at the end of last year even though our traffic stayed steady? I just don't see how. The implication would be that there is a specific sort of person who writes these reviews and that sort of person hasn't been visiting Tablas Creek, Justin, Adelaida or Eberle as much in the last six months even though our overall traffic numbers are steady. Maybe they're now boycotting Paso Robles in favor of other wine regions? I have trouble believing such an explanation.
  • Perhaps there are as many user reviews being written, but there is a new competitor in the field that is siphoning off reviews from both Yelp and TripAdvisor.  The obvious option is Google, whose Google+ allows users to write reviews. But the five Google+ reviews of Tablas Creek include only two written in the last year. The other competitor mentioned sometimes is CitySearch, which has only three reviews of Tablas Creek, just one written since 2008.  So, if they're moving away from TripAdvisor and Yelp, where are they going?

In the absence of another plausible explanation, I'm left to think that there has been some sort of shift against both Yelp and TripAdvisor among their users in the last six months.  Unless this is a statistical hiccup that will correct itself over the coming months (possible if unlikely) the possible conclusions are that we're seeing the bursting of a bubble that will eventually lead to a steady but lower-level number of new user reviews, or that this is the beginning of a long-term trend that will result in the category's gradual obsolescence.  I would tend to suspect the first explanation: that like with many new technologies, lots of people jump onto the bandwagon when they see their peers doing the same, but many find that it's just not for them. And it is work, writing these reviews, uncompensated work at that.  It's easy to imagine a reviewer getting fatigued with what's involved.

From a practical standpoint, even if it is true that user reviews are declining, the sites are still important for wineries to monitor. Both sites (particularly Yelp) are search engine goliaths, and there is well-documented evidence that even a single negative review can make a significant difference to a restaurant. A decline in the authorship of reviews doesn't imply a decline in readership, and in fact good reviews are more important now than ever, as there are fewer reviews being written and a negative review is proportionally more influential with a lower volume of other reviews in which it can get lost.

Still, I was interested to see that what seemed like an endless escalation of user reviews has not just slowed, but reversed itself. We'll see, over coming months, what this means.

Has TripAdvisor overtaken Yelp for winery visitors?

I keep a regular eye on Tablas Creek's reviews on TripAdvisor and on Yelp.  Reading these reviews helps me keep an eye out for potential problems, and also gives me a good overall sense of what people are thinking about the experience they have when they visit Tablas Creek.  Happily, it's overwhelmingly positive.

I have noticed a recent trend away from Yelp and toward TripAdvisor.  For years Yelp was the dominant review site.  Between 2005 and early 2011, Yelp tallied 69 reviews of Tablas Creek to only 5 for TripAdvisor.  In fact, I didn't even start watching TripAdvisor until mid-2011.  But in the last year, we've received an equal number of reviews (23) on each site, and so far in 2012, TripAdvisor has tallied 13 reviews to just 5 on Yelp. The chart below will give you a sense of how the trend has changed recently.

Reviews by Site
Both Yelp and TripAdvisor are powerful players in travel, dining and entertainment.  Per month, Yelp claims 66 million unique visitors, while TripAdvisor claims 50 million.  And the prominent placing of both sites' reviews in search engine rankings means that increasingly, consumers are using these sites in addition to or instead of the more traditional printed brochures and regional association Web sites that they would have used even a few years ago.  They have the advantages (and disadvantages) of crowd-sourced opinions, combining the perception of incorruptibility with the idiosyncracies of uncurated information.  But their net impact is tremendous, and is only likely to grow.

It's possible that we're starting to see some specialization between the two sites, which have essentially identical interfaces and market niches.  I know that I tend to think of Yelp as specializing in dining, and TripAdvisor as specializing in travel.  But a quick look at a few local restaurants suggests that TripAdvisor may be making significant inroads here as well.  Artisan shows 30 TripAdvisor reviews so far in 2012, but only 20 Yelp reviews (2011 and earlier shows 311 reviews on Yelp and 198 on TripAdvisor).  Il Cortile shows 16 reviews on TripAdvisor in 2012 (compared to just 40 before) and 17 on Yelp (compared to 123 before).  And Thomas Hill Organics shows 25 reviews on TripAdvisor (compared to 48 before) and 35 on Yelp (compared to 180 before).  Even if TripAdvisor still trails Yelp slightly in the restaurant world, it's clear that its trend is positive.

I know that lots of wineries have claimed and edited their profiles on Yelp, and many have also chosen to advertise with them, perhaps encouraged by the aggressive advertising sales push that many wineries, including Tablas Creek, received last year.  I don't see the same level of engagement with TripAdvisor.

Our experience suggests that neglecting TripAdvisor is a mistake.

Tasting Room, Then and Now

By John Morris 

I recently ran across this photo of our tasting room staff from an outing in December of 2007.  The thing that strikes me most about this shot is the size of our group.  Our entire tasting room staff at the time consisted of 8 people.  Now, 3 and a half years later, we’re 16 strong.  Pictured from left to right are David, Phil, myself, Zach, Sylvia, Brian and Gustavo.  Absent due to a school-related commitment is Chelsea, then a member of our tasting room staff, now our assistant winemaker.  Since that time three of us have gotten married, one has become a father, another a step-father, and two have moved to the east coast.  Tellingly, five of the eight are still employed at Tablas Creek, six if you count the occasional guest appearance by Zach. 

New Image

David, on the far left, was my first hire, and is perhaps our most energetic, even as he is our oldest.  Everyone else pictured predates me.   Phil recently moved to the Boston area to help with his grandchildren after a lifetime in California.  He exuded an oasis of calm in the tasting room for over five years.  Zach completed training at the fire academy last year as he juggled shifts here, and became a father a few weeks ago.   Sylvia has been our assistant tasting room manager since before I moved to Paso, if that says anything.   Brian joined the Peace Corps and was posted in Morocco after a year-long stint here, and now resides in Washington D.C.   Gustavo (originally from Chile, but commonly mistaken as Frenchman) came aboard just before me, and has been a rock for the last four years.  He spent two months interning in the cellar at Chateau de Beaucastel last fall, and returned even more knowledgeable than before.  Much of the rest of our staff, including Steve, Cindy, Tedde and Mary have been here going on three years.  Deanna worked here some years ago and returned last year.  Recent additions are Alex, Lisa, Joelle, Charlie, Teri and our dynamic new assistant manager, Jennifer.  Austin, our winemaker’s son, now helps out on Saturdays.

A lot has been made of our splendid new tasting room, with good reason.  It’s much roomier, beautiful to look at, quieter, supremely functional, and has been a dream to work in.  The cellar crew loves it because we aren’t setting up tables in their space every weekend.  We love it because we aren’t setting up tables in their space every weekend!  If you haven’t been in, you owe it to yourself to check it out. 

But in even in this striking new space, it still comes back to people.  Behind the gorgeous new bars, reflected in the huge glass windows that allow a glimpse into the cellar, you’ll see most of the same faces you’ve come to know, doing our best to provide welcoming, personal service with an educational twist, pouring wines we never forget we are blessed to work with.  Here’s to my crew.