Wine’s Culture Problem | Episode 13

41:15And difficult doesn't mean opaque. That's an interesting nuance. So what we were seeing is empirically, if that button hasn't been switched by the time you're 40, it's unlikely that you are going to become a collector and have that particular mindset when it comes to buying wine. And what's interesting as well, because you're probably going to ask me about the secondary market at some point, collectors always overbuy. Because what gets them excited is the chase. So dopamine rush, I'm looking for something really, really rare. I'm spending a lot of my resources in acquiring it. That's my time. That's my money.

41:55This is totally irrational to spend 15 hours a week in, you know, my passion of wine, plus a lot of my disposable income to, you know, put a cellar together that will never have the time to drink in all my life. So that's irrational. and you look for a chase, you chase, you chase, you acquire, the dopamine goes down so you always want to go for the next one. So what it actually shows you is collector always overbuy. So the secondary market is something that the collectors need because at one point you will have bought too much and you will need some fluidity in it and maybe your taste has changed and that's one of the things about wine valuation in the secondary market as well.

42:42It's not just for the pleasure of making money and it's also to give collectors some rationalisation about their behaviour because if they can see that their wine they bought is now 20 % up in price, even if they will never sell it, that's good for them. That's a good feeling, yeah. Because I've spent so much time, I wasn't crazy. And you can justify to your wife the time and the money that you spend.

43:09Jonathan Stevenson:You're assuming that there's no female wine collectors then? I'm saying that they are less. And that was half a joke because when we've asked people, when's a wine too expensive for you? They've answered always almost the same answer. Because as long as I can justify it to my wife, it's okay. So it was like justifying to the spouse. But if I can argue that this is worth me buying, then it's not too expensive. and then of course the price point changed depending on but they are in in the western market that we've studied so we've done that study in paris london new york singapore hong kong and shanghai in the western market and i would very be curious to know your gender ratio yeah but it's still a good 85 percent male 15 female was this was this the paper that you presented in the bin expo yeah yeah yeah um how did you find that slight segue but how what was it seemed from what i read that it was a lot more well attended this year than than the year before venexpo yeah hong kong it was my first time so was it oh there you go yeah but i can compare i mean it was very there was two vibes i had been in provine shanghai it was interesting yeah um and um yeah and and on the eastern market on the eastern market to hong kong singapore and shanghai the gender ratio is slightly more balanced something around 30 women and 70 men yeah definitely more yeah we've noticed that haven't we yeah and do you feel like with all of your sort of study and um as as the you know your business grows and you're continuing to try and find new things to overturn or you know new new paths to go down is have you seen or done any research already where it's very much geographically different right i mean there's obviously just the reason i just thought of being that that was um that's an interesting point because that was one of the hypotheses that we had when we started the research we were like surely we had six hypotheses only one was confirmed the rest of them were either denied or very very nuanced and one was surely there will be a difference between the west and the east like western market eastern market very different history very different maturity surely it's going to be different well the first takeaway if it wasn't it wasn't like the the conditions in which people started to be interested in wine was very similar and then the levers were the same sometimes the order of those levers were different like the rule of education was very much the first thing in asia like education was education was one of those first levers that they would push to stay engaged in the category when you know in london and it empowers people if they went through formal education, they did it later and sometimes they didn't even do it because it's easier to learn and to be connected about it.

46:01So the journeys that we've seen were very similar regardless of the markets. What was really interesting, though, is the biggest difference to stay on the gender was between male and female. So male and female have very different journeys in fine wine than the geography going back to slightly to between both of your points oh yeah um both of your points so what tom said i think is definitely right at one at one end of thinking but then i think what we've noticed obviously the more we've over the years dealt with collectors and they've been on their kind of collecting journey with us um is that it strikes me that in you know when you reach that let's call them the kind of the pinnacle of collectors that have significant sellers and they you know they have a very sort of broad collection of wines um almost the as much as the eureka moments of the taste and the flavor of a great wine whatever the price is also that kind of yearning to have something that someone else doesn't have or like that being able to have researched it so well that you've found a producer that happens to make on this particular plot of land and and you know you kind of want to keep those secrets to yourself somewhat and and actually that leans into what you were saying about that mentality of the collector where all of that justification comes out if they get a wine on the table that people don't know about and it's great.

47:23And that feeling is as much of a great feeling as it is just the actual taste of the wine, you know. But what you've said, which is really interesting, is that you mentioned to the others, and actually one of the hypotheses that we had was, you know, the levers that we'd led people. People will, you know, get into fine wine because they have access to money and they have access to wine education. We thought that was going to be the two levers. Of course, financial is one, like as long as fine wine remains expensive, which it will be in the future. So you need some, when it comes to access, first financial access, which is, by the way, one of the reasons why there are less female collectors because collectors is not, it's not something that comes with gender.

48:10though it's something that comes with money independence, being financially independent. So there's good hopes that as women are more and more financially independent, we will see more and more collectors. It's not the only thing, but it's one of the things that explain why there's less female, at least in Europe. Sorry, but the second part, so access is access to financial wealth, but also access to wines. And that's really important. We can talk about allocation, but having knowing for the young generation knowing the rules of how do I get the wine that I want who do I need to talk to like like because it's all seemed very clear and even you know when I started in London I had you know it took me two years to understand how the place de Londres works because it's not that really transparent and even when you start with the merchants today I'm sure that was one of the reasons you created your company like to get allocation of the wines that you really want through a traditional london-based wine merchant is a lot based on relationship and not on the manifesto on the door that actually tells you the role of the game right so that that access to the wine is really important too education is important because at some point what will interest people and will get them stay is actually what you said from the very beginning that wine is complex and you can learn forever.

49:32So they get into that because at one point their curiosity was peaked and they understood that there's something that they didn't understand and they want to understand. So education is a big one, either through like WSET or sort of certification like this, but also through peer education and mentorship, which is why collectors also work in groups. But the one that we didn't see coming as big as it, Like the third lever is community. Like people at one point, what we've noticed stopped people in the journey. We thought they were going to trade up automatically as they grow up and have more money.

50:11They only do so if their community trade up with them. If they find a new community that drinks at the same level of price and with the same level of interest. Because if you don't have people to open bottle with, what's the point of chasing? Yeah. because that's exactly this it's not just for the beauty of sharing which is part of it and every consumers i mean in the trade we all have this i'm sure but it was funny to see that it was also very true for consumers they all have two sets of friends i don't know if it's true for you gentlemen but you have your normal friends and you have your wine friends which sole purpose it is to open the bottle that you've been chasing for quite a long time because your normal friends will understand that yeah very true yeah they won't have neither the interest nor the education no actually seeing the point of spending quite a lot of time on that bottle they just want to drink yeah um something nice and they appreciate that it's nicer than what they normally drink but so consumers are exactly like this and so one of the things that we can do and that is going to sound extremely cynical but one of the things that i think we need to do better is find a way to monetize friendship so not just that again if if i put it in a more poetic way monetize

51:27Jonathan Stevenson:friendship like how can you sound very transactional i know that's why i'm saying it's cynical but how can you as as someone who sells wine spend some of your time by building those community of friends that you like some sort of an all-in-one you buy wine from me it's a bit like a real estate agent it's like well you're new to that country i'm going to show you where to buy your house depending on what i understand from you but not only i'm going to sell you the house i'm going to introduce you to the local school i'm going to introduce you to what are you interested in sport here like the football circus and you know coach i can you know introduce him if you want your kids to play there like doing that kind of introduction throughout the community so not but of course what i'm saying about monetizing is that because that takes time and wine tastes better when it tastes of margin so we have to find a way of making it work financially but we've built a system in fine wine where it's all about selling bottles uniquely and bottles after bottles that sometimes change hands and every time you make money out of it but we have to find a way of building the communities that will actually again destroy those bottles if you want to you know destroy the stock and drink the wines and we don't really do that like the business models that we have at the moment are more on the bottle exchange than in selling moments and people i like it i think it makes sense yeah that whole set of strength in numbers i mean you know we often talk around how we can bring our community better closer together because like you said especially when you have people that are so wine fanatic that they have such a big collection and they have all of the why would they buy great names that they actually the best way for them to actually rediscover that excitement is because they have the issues we've discussed where you know they now instead of having a wine drinking friend group they they probably go cycling because everyone's more conscious of their health um i've got a particular client who says that that's the case and then all of a sudden it's like staring at this collection thinking well who can i drink these with so actually yeah those connections at that level of collector is really important and when and where can i drink those wines with as well because i had i had a winemaker that asked me well then put in what can we do for like we've built all those collectors have like humongous level of stocks and they're never going to build it to drink it and that's a problem and like well that's also a consequence of a system that never encouraged moments where collectors that have spent so much time and money buying those wines can actually open them everything that we set that we do as the trade you know we do wine tasting we sell tickets for people to buy more wine we don't sell tickets for people to open them and that's interesting because i'm on a whatsapp group with quite a few people and like what we do sometimes will be you know someone will go okay um you know it's quite an extreme example but like i really like crude clade and manil okay and uh you know i've got a 2004 i'd love to open but it'd be really great if there's five or six other people that have also got a different vintage of crude clade mill and let's all just say we want to do it and then we can find a time and a place depending on where people live in the world and whatever and so what happens is you know you kind of propose it and someone goes oh actually i've got one of those i'll bring on this and then you get five and five or six people and then you go right the winemaker with you yeah exactly because the winemaker of krug will have found i don't know a way of building a club of amateur of claude and once a year when there's the new release of the vintage they will organize something which is included in your member experience or whatever where you can bring your own bottle because what you will want is also share that with you know the winemaker and i mean there's loads of different things that that we can do but like to actually encourage people you know everyone there's there's release of new vintage every year we don't do many release party right like that estate released their wines well do a release party where people can come with it all vintage and you know you invite them instead of spending your marketing budget in yet another you know wine making dinner you buy the food for everyone but everyone brings their wine in the sort of yeah but just for that because then everyone that you bring will share the common point of liking your wine that's a big yeah i was thinking that when i was in bordeaux for the emprimeur uh tastings this last um you know a few weeks ago and i was thinking maybe that could be like an angle that might bring bordeaux and premier back to life a little bit for the consumers is like actually having an adjacent week where there were ticketing to the public to taste on premier right and to actually get that whole feeling of the story of the wine and the vintage and you know we can do our best to bring that to people in in our reporting and and having been there but actually for people to go in firsthand and get that yeah and one one person's you know love for margot will be another person's love for pavi for different reasons of the architecture what you know yeah that whole thing of your i think a lot of what came out from what i was reading prior was that whole aspect of like the experience is so much more than i think a lot of people realize but to give people good experience there's something that we need to do better is the curation of the group and spend a bit more time in curating those group of people because people want to drink and again with people that drink at the same level of price than them this is quite easy to find in your data set but also they want to drink with people that are here for the same reasons and that's no judgment of me but in some countries or in some groups people are label drinkers and they just want to like bring the wine that's the most expensive and that's fine this wouldn't be on a personal level the type of people that i would be interested in tasting with on a regular level because first i can't afford the most expensive wine but also that's usually not what i'm looking for in a wine some other people are really into extremely geeky things right and all they talk about is the degrees of fermentation you know or like some really geeky stuff others are more about just you know what gets you there's different group i'm sure you've been in many 100 yeah so and it's a different type of experience there's a different time and place you want to have that i mean there's a well-known collector in london who always puts on some crazy tastings where you do like a vertical of when we did a vertical claude d 'atar going back to 1945 and frederick ongera was there and we did petrus going back to like 1897 or something stupid but you know obviously they're expensive hellenistic events and you know you're tasting it's a once-in-a-lifetime experience but you don't want to do that all the time you know you do that once a year maybe maybe on a special occasion just to have that unique experience to taste the wine in that way but as you said earlier you also just want to open sometimes just want to open a bottle of wine with one other person we just enjoy that one bottle of wine i think i remember going to the petris one saying like it is a ridiculous thing that i'm sitting here analyzing whether the 89 or the 90 was better than the 82 right where in any normal circumstance you will just enjoy if me and you were sitting there having 89 we've both gone oh my god that's an incredible bottle of wine and we just enjoyed it and we just had relaxed and we We drank through the bottle over a couple of hours and just thought that was brilliant.

58:40Jonathan Stevenson:But all of a sudden, I was in a scenario where I was going, oh, do you know what? The 89 for me was a really bad wine in that flight. And you're just like, what is the world coming to when you're doing this? And you kind of sense check yourself afterwards where you're like, it was an amazing experience. I'm glad I did it. But do you know what? You can't just do that all the time because that just becomes ridiculous. And imagine if you had to pay for it. I mean, I don't know if you paid, but as a member of the trade, often we have those kind of things where we don't have to pay for it. But as a consumer, when you have to pay for it and you sat through an experience, which is interesting, but you sat next to someone.

59:12I've never been as I've been sitting next to very old gentlemen that talk to me about the good old days where the Romain et Compte was 80 francs. I'm like, good for you. And also talking at me, but not talking with me. There's loads of different, you know, behaviors like this. So I guess going back to my point in one of the really actionable thing that I think the wine world can do better is to think as as a top hospitality venue. When you look at how the clubs or the restaurants that are very successful with the Golden people, what they do is usually the people that are in charge of the floor sit down three hours before service and they visually organize the room.

59:54Yeah. They visually organize the room. Who's going to sit where? Who needs to be at the center? The ratio between...

1:00:00Jonathan Stevenson:Based on the guest list coming in? Because they know the people or just... Yeah, because they know the people and they can organize the stage of it. And because they had some control, because those are very demanded place, where people can sit. And so just imagine if... Sounds like my wife when she was doing a seating plan for the wedding. But that's exactly this. For months. It's just like, we've forgotten the hosting part. Yeah. So when we host events in the wine world, we see it as a way to sell tickets, which is a good thing. We need to do this. But like what's the first responsibility of a host is to make sure the guests have a nice moment.

1:00:35Jonathan Stevenson:Curating the experience. And you can't do this if you don't curate the room and the table plan. And you can only do this if you just first update your Rolodex sometimes and just stop inviting always the same people. Because how are wine events often built in the wine world? It's either you sell tickets and come whomever pays and then, you know, whatever, they sit. Or it also goes when it's a bit more exclusive or rare. It can go through your private advisor kind of thing that will invite you based on relationships. Sometimes you miss some people because you also have some biased relationship with people.

1:01:13Right. So how can we do to actually make sure that the room that we, we spend enough time on the room so that we make sure that the guests have a good time, not just because of the wine and the food, which we're always good on in the wine world, but also just imagine going at a wedding and not being able to talk for two hours. Because all you would do at the wedding is listening to the bride and the groom talk about themselves for two hours. sometimes they're being funny sometimes they're being very boring depending on how good a speaker they are like you come to wedding first because you want to share something with them and sharing

1:01:53Jonathan Stevenson:is also a two-way street so is that that traditional structure of a wine event is that something like sometimes i feel like we want to convert people so much because we want them to sometimes that's not necessarily but also i feel like we've everyone's got into such a kind of rigid way of thinking that you just do it because you think that's what people want if you know what i mean it's not necessarily because it's what we want to say and again i was just joking about you know being even logistic even evangelistical about things and preaching to people but i think the side the side effect of being so passionate about the wine world or being so dedicated and loving what we do is that we really want to tell people because if only they knew they would be saved when actually we push a lot because we pride we're very proud of the wine on the table it's been complex it's been difficult we want people to understand how do you create that environment where everyone feels comfortable you just let them talk like again but a lot of people find that intimidating as well right you know people want to enjoy the wine in their own way It depends how you create the room.

1:02:59And again, if you do that, there are some cultures where it's more difficult, where people are really here to listen. It's not the case in the UK. It's not the case in France. People don't want to be lectured. So, I mean, there are some cultures where they really do want to learn and would listen to you and not going to speak because that's not how they've been learning how to go through life. But in the UK, that's not how people think. So I'm not saying don't talk about the wine. Just like I'm not saying at your wedding, don't speak at all. But you speak for like 15 minutes each. You're at my wedding.

1:03:34Do you know how long I was going to say it? And then you let people talk to each other. And if you've done a good table plan, again, back to the table plan, they will have things to say. And have you been to those events? I think there are hosts that are fantastic. I've been to those events where there were like 100 guests and the host knew every single person and could greet them with their names and could introduce you to another person saying, oh, hi Pauline, well, Pauline, this is John. John does cult wine. I'm sure you will have loads of things to talk about because you both like Chardonnay.

1:04:06And then he walks away. And then you left with Jonathan. And I've got a conversation starter. And in a culture where people are not super shy, which is again in the UK, you can have that. So know something about your guests so that you can introduce them with other guests. and so you've you've done that matchmaking i know what you mean i mean we obviously have hosted many different types of events and versions of tastings and it what is incredibly difficult to get right at times is just when you can clearly see in a room of let's say 20 to 30 people there are some people in the room always the case that are really there and and want to get so much of the detail and yeah and a bit like how you describe the different types of collectors earlier but like then there are people that really just want to have like they're interested they're there and they pay the respect of you know listening to the the presenter or producer and then there's the people that just aren't interested at all and actually to try and kind of create an event that speaks to all of them in the right way is very difficult what if you were to have tables that were curated by those style of because i understand also economic constraints right you if you have to do one event with 50 people you it's more expensive to do 10 with five yeah but what if you were to create tables so you would have a full introduction everyone will have the same introduction and then in your seating plan you put the technical director with the geek table and then you know in in the more we want to have fun with our friends and we just want to enjoy the 1989 and then finish the evening singing whatever song you know you put them you put them with someone else well no yeah i've been to one event so you can match them and they have a table for themselves and don't put them with a technical director that that is yeah maybe it's gonna be lost or i mean talking about it's a cliche about the technical director not being an outgoing person but if there's a member of the team either in your team or in that crowd better that speaks to that crowd better and then suddenly you have one event one budget but you've done the somehow when people talk about personalized experience they think about you know um vr experience and they think about super complicated things sometimes it's just like giving people what they need which is the technical details the opportunity to sing together or you know to bring their own bottle whatever but i mean i always i don't want to make things sounds like they are easy to do i know how complicated it is to sell wine today but my point is a way of thinking i'm sure this is doable we do it for a wedding we can do it for a customer i do think you're interesting just thinking back to what you said around the immediacy and that that being quite a big barrier to how because a lot of what you're talking what you talk about i completely agree with and i think it's just that feeling that it's it's quite a far thing to read like it's a set it's accepting that the whole thing is much more of a journey than it is an immediate transaction and i think what's been really interesting listening to your point is i think you're just being really thoughtful about the

1:07:09Jonathan Stevenson:whole process whereas i think if you are an industry and we're in the trade and i think this is the point you made earlier it's easy for us to kind of get into that transactional mindset that transactional mode i think being a bit more deliberate a bit more thoughtful about the whole process in a way enables a better overall experience which i think you know is something that you know i can take away from today which i think you know it's really insightful some of the stuff you're saying well we've been we've been quite lucky in that for a whole generation of trade people and again i don't want to diminish everybody's work but it's been quite easy to sell wine right over the last 15 years maybe 20 if i can exaggerate a bit yeah probably um it's not the case anymore like selling wine at every sort of price point or level is not that easy for lots of different reasons one being economics and just people having less money a second one being there's less young people so um alcohol concentration is really focused on the youngs um so selling wine today is more difficult right so if it was still easy i would say just you know if your company works continue right there's no reason to be worried it's not the case today and i'm i think there's loads of things when we look at the levers there's loads of things that we are not doing really well because for some reason it worked before so we never really thought about doing it differently we were making money we were selling we were growing it's not the case for a lot of people today and um the english saying of never waste a good crisis i think it's really a good moment for us to like like why are we doing this and i think we are the first one to that to be wine is amazing it's a social lubricant it brings people together and then we'll be we build business models that are just very transactional and selling bottles which again makes sense no judgment but that might be a good time today to actually well if that's really what we're here for yeah what can we do to improve yeah what we offer to our customer i will now take the opportunity to introduce a quick game that we're going to play Alexa always likes to give us a game and today we're going to play a game called Hype or Hold I'm going to give you a trend shaping the future of fine wine and you tell us, both you and Tom whether it's a real lasting shift the industry should build around or hype that will fade So hold is the long term thing and hype is something that will probably fail Yes.

1:09:43Fade. Fade. Or fail. Or both. Yeah. Okay. So first one, and in brackets here it says rapid fire. So forgive me if I really fire this across. Under 40s will drink less but spend more per bottle. Hold. Tom? I'm going to follow in on hold. Okay.

1:10:05Jonathan Stevenson:Very good. Save option. I'll go first next. I'll go first next. Sustainability credentials will move fine wine prices within 10 years. move up or down up um hold sustainability credentials are important and sustainability can't be differentiated to fine wine i'm not sure that will put the price up i think it's i think it's the baseline it's just like but it doesn't table stakes yeah yeah okay yeah um one education so the WCT etc is the gateway to the next generation hype you said hype no I'm going to say hold education is important and the WCT has done miracles in Asia speaking of which China is the growth engine for fine wines future hype hold it's one of the growth engine it's getting tense now we need like the and culture and culture interestingly is the key because fine like china is the reverse than europe where wine has built through economics without being a cultural product so it's been developed because it's an economic product but with no culture that doesn't have a place in people's life and that's that's the hold is that if wine can find a place in people's life, which it has started to do during COVID, that's the next big thing.

1:11:38In China specifically? Yeah. Do you think as well, as they begin to produce their own wine? Yeah, maybe not European wine, but wine. Okay. Interesting. Experience over ownership, tastings and travel beat building a cellar. It goes hand in hand.

1:11:57Jonathan Stevenson:Yeah, it's a difficult one because I am a firm believer in experience rather than just being about... But you love your cellar. Well, it's got to go hand in hand. It's got to be together. You can't just experience it and never own the bottles. I think being experience-led is hold, because I think it is the future of wine. I think it's going to help wine into the future, like playing on the experience side. But knowing how the collector brains work, it's all about holding a product as well. You can collect experience, but yeah. Yeah, that was slightly ambiguous to be fair. fine wine as an investable asset class is here to stay it'd be funny if i said height wouldn't it hold hold i mean we haven't had the chance to cover that question like on graham norton so if you say no i think people i mean the valuation of wine on the secondary market is here to say again i've describe some of those mechanisms behind it.

1:12:56Now, I really want to question fine wine as an investment asset because until Monday, until very recently this week, I had never met someone that had made real money in wine. Like usually the people, the money that people make on wine is absolutely not comparable to the money that they make in real estate and bonds and stocks and everything and I think it's somehow intellectually false to present it as the same category of investment because it's a game and if you can make 10 20 30k on it fine but that doesn't build you a retirement plan now I've met someone on Monday that had made a very very very very big amount of money on wine 20 years ago and he was saying that it's not possible to do it again today so I don't know what's your take on it I think even if you can make money with wine a bit presenting it as an investment asset is slightly wrong because again it's not your retirement plan i think it

1:13:55Jonathan Stevenson:really comes down to like the the bit like we were saying earlier in terms of wine isn't the only thing that you invest in you know at the end of the day a lot of people that invest in the stock market they have real estate these people have a lot of wealth so they're doing it for fun but it's not serious money no but it's a diversification from the perspective of it is very important i think and it doesn't have to be wine it could be things like art it could be cars it could be other alternative asset classes i do think at a certain level of wealth it's very important to diversify your investment portfolio the assets that you hold away from just things that are directly correlated to financial markets and i think really you know we would never speak to or encourage anyone to okay your entitlement plan is all about wine that's absolutely crazy but i think if you again if we think about the pyramid it's like you start with your classic you know bonds stocks and shares obviously cash ices you know income producing products but at the bottom if you have enough wealth and income you should be diversifying your your overall investment assets away from just that basket of individual assets because there is enough proof and evidence you know over the last 20 30 40 50 years that fine wines do appreciate so at the end of the day if you can hold an asset yes that holds value and actually so i'll reframe that question the capacity of wine to make substantial revenue is probably a hype today for the time being the capacity of wine to generate revenue the way it had up until 2010 probably, is probably over for the foreseeable future.

1:15:23It might come back. I don't know if it's suitable or not, but that's another conversation.

1:15:28Jonathan Stevenson:I think the other thing about investing in wine, because I think it's such a contentious description of what the process is, I think the way that wine is manufactured, the way that it's consumed, the way it has to mature, at the end of the day, wineries make wines today and they release them at too young an age and they're not supposed to be drunk for 10, 30, 10 20 30 years who's who's carrying that cost economically that's there has to be there has to be an economic incentive yes so the two things i would say last 20 years the proliferation of investing in wine as an asset class one of the biggest upsides is going to be in the next 20 or 30 years as consumers we're going to have so much more access to mature wines that have been stored correctly because people have an economic incentive to store it correctly you know if you go back to the 70s 80s i've had enough bad bottles of 70s and 80s wines and i've had good ones because there wasn't the incentive they weren't looked after in the correct way so i think there's a benefit of investment in wine is i think a integral part of the fine wine market because someone has to have some sort of economic sense it's slightly different to say we want we find the fact that wine values on price through time different than saying investment and making money out of it because you might just want to recuperate like the valuation of a wine is for many different reason essential like collectors they need that you know that rationale of their behaviors as you were saying covering the cost of aging but there's a difference in presenting it in asset class that is slightly different like the fact that you can invest in wine because it's not going to lose value and it's going to give you at least cover the cost and allow you to to taste those amazing wines 20 years later without having lost money is different than to say invest in wine because it's a seven percent return it's a slightly different thing and i'm just saying on on the investment asset pure things i think it's just one of those branch of those trees that gives someone another experience with wine i don't think it will be able to bring that kind of return on investment like it did before in the foreseeable future because some of those mechanisms that led to wine being really interesting financially are not in place at the moment that that's unless it has william kelly written on the label yeah yeah yeah and for very specific wine in particular like some like unicorn wines that you you will always like find a bottle but generally speaking like the way people in the and again it's very market related because you can't do that in france it had you know there's only certain marking that allows that um i think that was a very difficult no i think about i think with i think with wine there's like an economic framework that i kind of think of like as time elasticity which is the time elasticity principle with wine is that if i have a wine that's that wine there but a 2001 vintage and this is the 2018 vintage generally speaking if i said the 01 vintage is 50 and the 18 vintage is 50 which one do you want to buy you know you most people i say would trend towards the 2001 right because they're going to say well to get that wine with that level of age and maturity i'll pay 50 if i said the 2001 was 100 this one's 50 then you'll start to see some people shift towards the 18 younger vintage versus the older vintage then you get to a point where i say well the 2001's 500 the 18's 50 you almost like 99 of people want to go to the 18 vintage right and then you get this converse effect where if i said it was 5 000 for the 2001 you get some people moving back to the 2001 because they think oh if it's that much more expensive there must be a reason but there is this economic theory around time elasticity and i think that principle of wine is why fine wine as an asset class or as an investment or as a product will always appreciate in value because people are willing to forego time i'm willing to forego time and pay a premium for foregoing time and really that's down to every individual how much they're willing to forego and the availability of that particular asset class but that's why fine wine as an asset will always appreciate in value or deliver let's say financial returns over the long run because i know for a fact that a well-stored bottle of wine comparably is going to fetch more in the market than one that's 10 years younger now the problem we've had in the wine market last five or six years is that newer vintages have become more expensive than the older vintages and therefore the whole thing's been flipped on its head so to your point yes that that model has somewhat broken down a little bit because there's been maybe some egregious price increases especially from certain regions where suddenly why would i pay double the price for the 2018 vintage when a 2001 is half the price now obviously everyone's going to trend towards the 01 and that's kind of what you're seeing happen in the marketplace so i think there's a lot of nuance to this whole concept of investment i think you said something earlier around collectors which is collectors obviously are collecting for the rarity and wanting to own wines they're going to have more than they ever have but the value of them is almost kind of that secondary reassurance around their whole passion for collecting wine which is i collected it because i wanted to own these rarities but also at the same time knowing that they have gone up in value is also kind of a secondary benefit.

1:20:19Well, my point was just like when you present wine as an investment class or an asset, you always have two things, right? There's the existence of the secondary market and for all the reasons that you've said, that will continue. And wine valuation through time will continue, maybe not as much as we've seen in the past. But then there's people that just buy wine, like they would buy stock exchange thing because that just brings them money. That is something that I see. some like that's something for me which is slightly different um that's that's all i

1:20:50Jonathan Stevenson:wanted to point it out no i completely do you know i don't necessarily disagree and i think what's interesting for us in our business is how many like how many of our clients have zero interest in wine like very few but how many of our clients are teetotalers very few but people and this goes back to your point around like that collective mindset sometimes people see investment as their way their gateway into wine yeah for those that may be a little bit more intimidating it's fun because it's fun like and i'm sure you have i mean that's also one of the things that made that bring young people to it is like all the digital platform that somehow gamify wine because it's fun it's just like an auction right you can have a lot of fun seeing your wine increase decrease i've met a lot of young consumers they've got an ex-house spreadsheet they see like they've got like those curbs and the things and that's a really big source of fun for them and i think that great go for it and following all the tools that you guys have online and you can have on your app on your phone and you can trade sitting on your bed at 2 a.m in the morning yeah because that's that's i think that's really nice entry point for a younger like generation that yeah yeah find that aspect very attractive just like when auction went online it really brought a lot of young people to the auction world yeah because that's just made it more fun um so i think yeah that's really to that extent i think that's really interesting yeah it's also an interesting way of bringing people into it because again it's all back to what gets you into it and what makes it fun for you and it might be the technical detail of it or it might be the valuation of the 2018 vintage and comparing to estates you know yeah i think the other thing for me as well i think again looking at like the future of wine it's i think about this concept of optionality so when you when you buy a wine you know you might not know your specific intention in the future you know i might be desired i might want to buy that wine for you know as you said a rarity chasing after putting it into my collection filling in a vintage i didn't have i'm going to drink that wine i have the intention to drink but whatever your intentions are you want to maximize optionality and when i talk about maximizing opportunity is whether i decide to end up drinking that wine or end up reselling i want to maximize the either drinking experience or the economic benefit and i actually think both of them are intrinsically linked as in if you're buying purely for drinking you're going to look after and protect and do exactly the same things you're going to do if you also want to maximize the value in terms of how you acquire it how you store it how you eventually dispose of that of that asset or that case of wine and actually the two don't have to be mutually exclusive they actually can be the same thing and so that's the thing that we are really trying to drive of our platforms and our apps and the tools that we build which is trying to facilitate this ability for people to own wine in a very optionally maximal way which is i can own a collection of wine that i know any time of day i can get delivered to me any part of the world but also at the same time i can wake up in the morning with a notification on my phone saying someone's just bid a thousand dollars for this bottle of wine that i paid 500 for do i want to sell it press one button sold the wine get the cash and it's done but similarly the next day if i wake up my friend says to me hey bring down a bottle of you know mouton rothschild and we're right get that delivered to me and then two days later the wine delivers to you and you drink it and it's in perfect condition so for me that's what i think is not the future of wine but i think that's what we're trying to drive towards which enables people not to maybe have the pressure of one or the other but still have the excitement of both being a collector but also having a financial interest of it as well anyway that was quite i mean that's quite divisive topics but right at the end of the podcast.

1:24:22Jonathan Stevenson:I mean, we could... Do you have some more... We need to do part two now. So you need to stay... Because there's too much more to talk about. You got into a controversial topic. Do you want to just quickly cover the wine? Did you enjoy the wine that we had today? I love the wine. Thank you so much. So yeah, so this was 2018 from the main Pierre Besson Merceau Le Grand Charon, which is not a premier crew. I think it's a L 'Ordie. I thought it was fantastic. Really good. Yeah, it's the best it showed, I think, as well. Yeah, quite reductive on the nose. Quite really expressive. I think we mentioned that earlier.

1:24:47Jonathan Stevenson:Strong aromas. thank you so much no I can't answer that question I don't have too controversial I don't have a favourite kid either I love all of them for different reasons

1:25:02Jonathan Stevenson:but yeah thank you very much this has been an excellent start to series 2 well thank you so much for having me it was fascinating talking to you as well it's fascinating to hear from you someone that's obviously right in the nadir of the fine wine industry market category really got your finger to the pulse and to be honest if you're just sitting here I was thinking to myself I can't believe we're managing to do this for free on a podcast like if we had to pay you as a consultant it'd be costing us thousands of pounds so thanks very much for a free letter in business strategy go to the Arini.global website and you can subscribe to the newsletter do you know what I was going to say the report you released was it in February yeah yeah I mean absolutely brilliant report if you haven't heard about it online or read about it do go to your website it's available on there I think they can sign up yeah so the way Arini works is 60 to 70 percent of what we do is free for everyone and we have a podcast as well we have articles we've got two newsletters a month and then maybe 30 to 40 percent of what we do is for members so the best way to get access to everything that we do and that would be all the reports but also some of the members events that we do well we organize online and physical roundtables so that's the moment where we put people together around one questions and then people can discuss that and benchmark and share good practices um so you can become a member membership for full access is 440 pounds a year um and that will give you everything and as you were saying thank you for pointing out the report is worth way more than that so exactly if ever there was a reason to go down and subscribe so um look thank you very much for coming um this has been a great episode i've really enjoyed it jonathan thank you very much for being thank you very much yeah really enjoyed it and yeah everyone at home you know what you need to do you need to like you need to subscribe you need to leave us some comments whether you're listening on your favorite podcast channel whether you're listening on Spotify even on YouTube or maybe just on our social media you're looking at clips make sure you engage with us we want to hear from you if there's any type of guests you want us to have on if there's any particular topics you want us to cover we'd love to hear from you and we really hope you enjoyed this episode we did here and we can't wait to hear you next time and thank you very much to alexa our our ever-present uh driving force behind this podcast if it wasn't for alexa none of this would happen so thank you so much for all of your efforts um and that puts the pressure on her for episode two so you've set the bar high now we need to we need to we need to keep delivering so we're looking forward to seeing who the next guest will be but yeah thank you very much i'll stop going on and uh yeah we'll see you soon