Robert Mondavi, for example, might quickly sell out of a reserve wine that wins a high score, but the activity will hardly make a blip at the publicly traded Oakville winery, which sold almost 8.7 million cases last year. High ratings for Mondavi reserve wines leave a warm afterglow that envelops the winery's lower-priced brands, such as Woodbridge. If Robert Mondavi stands for quality, that must mean that Woodbridge is quality also. It is an intentional strategy to get positive reviews, in the hope of influencing consumers' perceptions of a mass-market brand with a similar sounding name. Philipps argues that Wall Street analysts should pay attention to tasting scores.
Quality translates into pricing power.
A few Wall Street analysts do watch tasting scores as an indicator of whether a winery will be able to raise prices, and therefore improve their profit margins, Philipps said. Some, in fact, are concerned that lukewarm reviews for the 1998 vintage now hitting store shelves will prevent wineries from raising their margins. Investors may not trust tasting scores because of their fickle nature, Eyler said. In addition, publicly owned wineries generate most of their sales from mass-production wines that the Wine Spectator rarely, if ever, tastes. Eyler intends to expand his study to include international wineries.