UNITED BENETTON of COLORS

16 April, 2007 Box wines are worth toasting

Premium varieties replace cheap, sweet stuff
April 15, 2007

BY LAUREN SHEPHERD

ASSOCIATED PRESS

Composer-turned-writer Steph Waller considers herself something of a wine connoisseur.

But she isn't seduced by the sweet smell of cork or the curve of a narrow glass neck. Instead, the California native swoons over a glass poured straight from the box.

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Waller is among a growing group of wine drinkers who are turning to the box rather than the bottle. With better wine varieties now available in boxes, wineries are attempting to give the category a new identity far from the rowdy boating trips and drunken fraternity parties that gave box vino its cheap, low-quality image.

The effort seems to be paying off. Box wine is now the fastest-growing wine category. According to data from AC Nielsen, three-liter box wine sales grew 44% in the past year, compared to a 3% gain in overall table wine volume.

"It's gaining tremendous acceptance by the consumer," said Ben Dollard, president of Pacific Wine Partners, a division of Constellation Brands. "It's just the tip of the iceberg."

Vintners have been doing a good deal of experimenting in the last few years. Wine even comes in plastic bottles and cans.

Although wine has been packaged in a box for some time, the new boxes aren't like the five-liter jugs of sweet, headache-inducing wines of the past.

Although those still are readily available, premium varieties on the market show a bit more complexity with hints of berry, apple or oak.

Of course, the premium entries are more expensive. For example, a Chardonnay can run $20 for a box that contains the equivalent of four bottles, whereas the lower quality five-liter boxes sell for between $6 and $10 for more than 6 bottles of wine.

The premium boxes are still a steal, however, because one quality bottle can cost $10 to $30 or more.

Box wine manufacturers can afford to charge less for quality when the packaging materials are far less expensive.

Morningstar analyst Matt Reilly said that bottling a $4 or $5 bottle of wine can cost $1, whereas a box can cost a tenth of that.

And of course, you can't beat the convenience. You can take a box of wine just about anywhere or you can leave it at home and not worry that it will go bad. Box wines stay fresh for as long as four weeks after they're opened because the boxes contain a vacuum-sealed bag that prevents the wine from being exposed to air.

"A box just kind of sits in the fridge and I don't have to think about it," said Waller.

Despite the advantages, Wall Street analysts and wine industry experts say it could still take some time before Wine Spectator-reading enthusiasts -- and the grocery stores and wine shops that cater to them -- can fully embrace the box.

"People are pretty nervous with taking that leap," said Barbara Insel, managing director and wine researcher at MKF Research. "People need to feel comfortable that their friends won't make fun of them."

For now, the new wines are attracting drinkers content with a glass a night at a value price. These drinkers may have outgrown the wine cooler college days, but are still less sophisticated than the tasting room aficionados.

According to a 2005 Constellation Brands consumer study called Project Genome, wine drinkers can be sifted into six different categories based on their preferences and attitudes about wine. Leslie Joseph, vice president of consumer research at Constellation Brands, said the research found that three-liter buyers mainly fit into the "image-seeker" category populated with younger males eager to be seen as trendy and hip.

"They're the people with the newest toys," Joseph said. And "they like to educate their friends."

The age range of the average box wine drinker has been changing, though, Insel said.

Most people assumed the new wine was mainly for the millennials -- drinkers who turned 21 after 2000 -- who were "looking for a cool new unpretentious way to drink wine," Insel said, "but baby boomers are buying it now."

The road to becoming an acceptable alternative to the bottle for younger and the older generations has taken years. To attract them, Dollard's brands -- producer of Black Box, Blackstone Winery and Hardy's wine brands -- focused on how to bring elegance to the box.

Dollard said he highlighted which region the wine was from, traveled to tastings around the country and started selling the product at smaller retailers to build word-of-mouth praise. Ryan Sproule, the founder of Black Box, said he specifically designed the box to appeal to well-heeled consumers. He said he chose a square, cube shape with a black background and printed a wine label directly on the box.

"You had some familiar wine things there," Sproule said. "The only reason no one had ever had done it in the U.S. was strictly the stigma of the package."

Although the wines can be found in major retailers like Wal-Mart and Kroger, many stores stock it in the same section as the lower-priced and lower-quality box wines of yesterday.

"That is the biggest problem we have," said Sproule. "It's a problem we don't necessarily have the best answer to."

To attract consumers willing to spend upwards of $15 on wine, premium box wines would ideally be shelved right next to their bottle counterparts.

"You see that a lot of times with new categories when you try to rebrand something," said Reilly.

Wine companies must invest in marketing campaigns to change perceptions of both stores and consumers, he said.

"There certainly is an educational aspect to it as well," Reilly said.

Reilly likened the emergence of the box to that of the screw cap, which finally has become more acceptable as an alternative to the cork.

"You will get consumers to accept it over the long run," he said. But in an industry where image is everything, "that takes time."

Even Waller, known among friends as the "Box Master" for her habit of bringing a box of wine to every party, isn't fully sold.

"If I'm going to spend $25 for a wine, I'm going to get a bottle," she said.

Posted by THE SAINT :: Monday, April 16, 2007 :: ---------------oOo---------------