Dinosaurs in the Cellar

Neil Pendock October 19, 2012 2

“How often does the tail wag the brontosaurus?” asks wine impesario Michael Fridjhon in Business Day this morning. The brontosaurus (below) being the Nederburg brand and the tail the annual Nederburg Auction “where turnovers dropped significantly for reasons that aren’t at all difficult to discern. The sale has lost its sex appeal — which means it’s not attracting the stocks and buyers that would make a difference in a tough market.

A week later it became clear that the Cape Winemakers Guild (CWG) Auction has usurped much of that polish and gloss — and its turnovers (as well as the average prices paid for a smaller and seemingly more exclusive offering) reflect its current position on the podium.” The only problem with the comparison being the “punters” at each event are quite different.

Largest buyer at Nederburg was Spar Supermarkets and I asked Spar liquor executive Mark Robinson how many bottles he bought at the CWG Auction and he made a zero with his index finger and thumb. Restaurateur Alan Pick was all over the CWG Auction but bought nothing at Nederburg. Only licensees can buy at Nederburg while the public is welcomed by the CWG and attend in their droves.

So if Nederburg wants to sex itself up, it need only open its doors to Sipho Mpublic and prices and volumes should soar for as Michael admits “the small batch wines made at Nederburg and KWV (and which bring in the medals and awards which have made both cellars enormously successful in the world of wine competitions) are easily as good (and often much better) than the select parcels which make up the CWG auction offerings. The punters don’t see things this way: they would rather pay three to five times more for a CWG sale selection because of the implicit boutique message.”

In fact the irony is that wines at Nederburg need to pass a rigorous blind tasting to be offered while at the CWG, a member can enter whatever he (and its almost always a he) likes, the blind peer tasting being abandoned last year after some high profile members were in danger of being given the flick according to the “three misses and you’re out” rule. So while wine auctions may indeed by dinosaurs in the cellar with consumers buying down and quality improving alarmingly at the bottom end of the pyramid, any bets on which one dies out first?

2 Comments »

  1. indeed October 19, 2012 at 1:51 pm -

    smart analysis Neil
    the fact that Nederberg auction resolutely refuse to allow private Jo Smo to waft his paddle boggles the mind. Obvious the “annoying” little guys buying for themselves have not put of the like of Pick, Makro or Wine of the Month club at the CWG auction.
    The argument of they can use proxy (licensee) bidders is silly and shortsighted, sales 101: don’t make the customers life harder, make it easier.

    Lastly, yes there are some great wines on Ned Auction at amazing prices, but there has also been a few gremlins through the years, where you could jump in the car and pick the exact same wine up at the farm at substantially lower prices…. not exactly auction material.

  2. NewsView October 20, 2012 at 12:27 pm -

    Just goes to show it’s not smart to try and be too clever in difficult times. ANyway, not sure how much longer punters will be willing to pay a premium just for the “implicit boutique message”

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