In a valley of ever-increasing prices, Malek Amrani of The Vice, is trying to bring value and discovery to Napa.  Producing 18 varietals from 16 sub-regions, The Vice showcases the full spectrum of Napa Valley at $29 a bottle.  Malek is “going against the grain” in many ways - focusing on value, discovery, and underserved markets to build The Vice brand for the long run.  

Detailed Show Notes: 

“The Vice” named after Malek’s main vice of wine

• Focused on value and discovery of Napa Valley

Production

• 27k cases total
• ~65% house tier, ~30% single vineyard tier (~20 wines/year), ~5% ultra-premium
• #1 SKU is House Napa Cab - ~11k cases
• They make 18 varietals, from 14-16 sub-regions w/in Napa, a little bit of Russian River Pinot and Chardonnay
• Sources both fruit and bulk wine

Cost mitigation measures

• Secure better pricing through pre-paying for grapes
• Being proactive - purchasing fruit from southern Napa vineyards in 2020 that weren’t impacted by fires, talked to 12-15 glass distributors to mitigate the 200-300% price increases

Focused on the wholesale channel (~80% of sales)

• Spends ~75% of the time outside Napa working markets
• In 2020, traveled every month except April working w/ retailers -> 100% success rate, added 400 retailers in NYC
• FL/TX buy more single vineyard wines; NY/NE - very House tier driven, CA/CO - good mix
• FL - a red wine state (driven by Boomers), NY - big in orange wine, nearly outsold House Cab in spring 2023

Customer demographics

• Equal split - Baby Boomers, Gen X, Millennials / GenZ
• Orange wine (~3,500 cases) - 75% Millennials / GenZ, ~25% Gen X
• Single vineyard Cabs - ~85% Baby Boomers & Gen X, Millennials focused on lower price points
• Appellations important primarily to Boomers who grew up with Napa becoming famous, Gen X sees Napa as a symbol of status, Millennials/GenZ appellation less critical, more price-driven
• Believes Napa will remain important, driven by tourism - 4M visitors/year

Orange vs. Rosé

• Swapped production of rosé wine for orange wine
• Believes rosé hit the ceiling in 2019 - rose a more social drink, also very vintage driven with closeouts on prior vintages damaging brands

Spirits vs. wine marketing

• Spirits has lots of product innovation, e.g., many flavors of vodka -> led to The Vice producing many different varietals and Napa sub-regions
• Spirits spend millions on advertising -> likely would not work for wine; better for the brand to be built account by account w/ gatekeepers

Consumer awareness of The Vice

• 2020/2021 - spent heavily on Google, FB/IG ads, had to shift when Sept 2021 privacy laws changed
• Awareness from a lot of referrals and through retail placements
• Some social media, in-person visits, and press/media - ratings are still important
• Pair wine w/ other vices - e.g., cannabis, candy, ice cream
• Thinks about pairing w/ the senses - e.g., vision (most important), hearing, smell (linked to memory and emotion) - instrumental hip hop, sex toys for a bachelorette party
• Works under targeted regions - e.g., Staten Island and the Bronx retailers
• Likes to go against the grain - be more value-oriented vs. higher end

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