08 August 2005 by Mike Ratcliffe
South Africa needs to create brands that are connected to their origin in a greater sense and surround that with a veil of integrity, writes Mike Ratcliffe on the last leg of their launch tour of the US.
Travelling in America is always a pleasure with efficient transportation and enormous hotel rooms. When you compare the tiny 'shoeboxes' that they squeeze us into in Europe, the spaciousness is an enormous reprieve. Also, prices in the US can be quite refreshing with the strengthened Rand, especially if you make use of an incredible value website called www.hotwire.com. Most of our rooms were booked in this way and I found myself in one of three penthouse suites in Philadelphia after using the last minute Hotwire function for a grand total of $110 including tax and charges. Don't forget to add GST to any costs that you see when budgeting for the US.
Philadelphia is by far the largest and best known city in Pennsylvania, (Remember Sly Stallone aka Rocky running up the steps of the town hall in his training?), but is not the official capitol and seat of local government. I mention government because PA is one of a few government-managed 'monopoly' states in America. The Pennsylvania Liquor Control Board (PLCB) is one of the largest purchasers of wine in the world and should be a significant driver for South Africa in the US market - as long as we get our positioning correct. I met up with our regional Broadbent sales manager, Rebecca Foulk, in Philadelphia and made the 2½ hour drive to Harrisburg, where we had lunch at the Hilton with the buyer from the PLCB for South African wine. The PLCB has made a commitment to the South African category, but has been frustrated by many 'wannabe Yellowtail brands' that are targeting the $6-8 retail price points, but are under-delivering on quality. Yellowtail is successful not because of the quality to price ratio, but rather because they have been fortunate to spark a 'first-mover animal brand' buzz phenomenon that has engulfed the US. Second place in this category is always going to be an extremely distant second. South Africa needs to create brands that are connected to their origin in a greater sense and surround that with a veil of integrity. Australia as a country, unlike South Africa, is well entrenched in the US and we need to perceptibly over deliver on quality if we are to attempt to compete.We were joined at lunch by the affable Bill Kohl, GM of the Harrisburg Hilton who also runs one of America's biggest and most high-profile charity auctions called Trés Bonne Anneé, which raises millions of dollars every year. The PLCB is a patron of the auction. Perhaps this is an opportunity for South Africa to participate and raise our profile? We shall see.Did you know that WOSA's own representative for the USA, Suzanne Morton, was born in Harrisburg Pennsylvania?
While I was in Harrisburg, Zelma and Phil were presenting the Vilafonté story and wines to the combined reps of the Prestige Wine Division of Eber Brothers (see picture), our NY distributors in Port Chester, a little town north of NYC. The meeting was extremely well attended and was filled with positive comment and enthusiastic response. Paramount is one of the most progressive regional companies and they are actively expanding their footprint across this region by purchasing smaller distributors. This is the face of American distribution and reflects the 'grow big or be swallowed' mentality that permeates the entire industry. The bad news for South Africa is that a smaller distribution pool translates into fewer possible placements which will heighten our internal competition and reiterate the call for SA to send the best wines to the US.We organized a car and driver for Zelma and Phil as they had to drive all the way across state and into New Jersey for their next midday appointment with the combined reps and management of the Meritage Wine Division, the fine wine division of the Allied Beverage group, our prestigious distributors. AC Nielsen has called NJ 'one of the fastest growing wine consumption states in America' and it has been in the 'Top 5 over $10 retail states' for a couple of years as it is really a dormitory state for wealthy Manhattan commuters. Zelma reports that they were inundated with enthusiasm and questions and that a warmer reception has not been had anywhere in the US. We are very positive about NJ and feel that we are with the right people and we are going to be spending a lot of time in this market. Furthermore, this is part of the Eastern Corridor focus that WOSA has identified and for this reason SA will also be putting funding into this area. After leaving Harrisburg, I had to rush back to Philadelphia to catch a flight to London. It was time to leave the USA with many fond memories, new acquaintances and fascinating experiences.