Tough times for Champagne

by Jeff Miller of Artisan Family of Wines (Seven Artisans, Sly Dog Cellars, Red Côte)

jeff-sm I’ve always liked Champagne, even if it’s not my favorite wine (not being red).

So I was pretty amazed, even astounded, to read the recent post on Palate Press (http://palatepress.com/2012/09/wine/alternate-bubbles-expected-to-unseat-champagne/)  on the sharp decline in Champagne sales:  “In 2007, prior to the current global recession, Champagne sales topped $1.5 billion (USD), compared to the just over $1 billion they are projected to hit this year.”  That’s an incredible decline.

I don’t think this really reflects a decline in the sparking wine category, as much as a retrenchment to lower priced forms of bubbly.  But does this represent a permanent trend, or something that’s merely a reflection of the Great Rescission?

I think it’s a little bit of both.

Part of it is that Champagne isn’t quite the monopoly of quality sparking wine that it once was.  There was a time that I really couldn’t find anything from anywhere else that was really comparable.  I would say that Champagne is still the gold standard when it comes to sparklers—but it’s not head and shoulders above the rest as it once was.

Even though Champagne isn’t my favorite wine, I’ve tasted quite a bit of it over the years.  I think the best I’ve ever had was a Charles Krug.  It cost $125 a number of years ago.  I have to admit that part of the allure of this wine was that I didn’t pay for it.  As a matter of fact, when it comes to premium Champagne, I’ve tasted quite a few, but never had to pay for even one.

And I think that’s a big part of Champagne’s problem.  I may love to drink it, but paying for it an altogether different matter. The best of it is damn expensive.  A great way to celebrate making a killing in the dot.com frenzy.  Not nearly so apt to get through the money-challenged last few years.  If you’ve just made a few million, then what’s $125 or even twice or even three times that when it comes of celebrating?  If you’re struggling to make your mortgage, Charles Krug is probably not on your shopping list.

The second part of Champagne’s problems is that it’s not quite so preeminent as it once was.  Outside of Champagnes, my favorite bubbly is the L’Ermitage produced by Roederer from Anderson Valley in Northern California.  How does it compare to the Charles Krug?  It’s not as good.  But it’s not that far behind either.  It’s an excellent sparkler, one that would hold its own against most Champagnes, even if it’s not quite as good as the very best.

L’Ermitage generally can be bought retail for someplace in the mid-$40 range.  So it’s less than a third of what the Charles Krug sold for.  Am I willing to pay that extra $85 for the relatively slight extra quality that the Krug brings to the table?  Absolutely not.  And I think, in these times, most people would feel the same way as I do.  But I think even when the economy improves, most people will still find substitutes for the higher priced Champagne offerings.  Certainly, to the extent they’ve already downgraded, and are okay with what they are drinking, they are probably going to need to feel quite a bit richer before they go back to the top-line Champagnes.

I really wonder the extent to which this phenomenon is going to be reflected in the sales of other premium wine products.  If you can substitute L’Ermitage for Charles Krug without undue pain, how much easier is it to substitute a non-Napa Cab for a Napa one, and save boku bucks?  And, unlike Champagne, which still is the best sparkler around, I question whether Napa Cab is really superior to many other quality Cabs out there for a fraction of the price.

In the end, Napa Cabs and Champagnes share the achievement that they have established themselves as brands.  But I recently read that supermarkets are expanding their private label offerings of canned goods as people are willing to sacrifice the “Heinz” or “Del Monte” label to save themselves a bit at the checkout counter.  I think we’re seeing the same thing when it comes to wine—people are finding lower-priced substitutes that work well enough.  And I think it’s going to stay that way at least until the economy turns around in a big way.

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12 Responses to “Tough times for Champagne”

  1. gdfo says:

    You have hit the nail on the head by stating that you enjoy drinking it but not paying for it. Many wines have priced themselves out of reach for all but those with no concern for price, which is few indeed.

  2. wine factor says:

    One correction that must be made here is that the Champagne that you loved was not Charles Krug. It was simply Krug. Charles Krug is a California winery.

  3. larry says:

    your blog would be more powerful if you called krug, krug, not charles krug [the napa winery of that name has nothing to do with champagne krug].

  4. Tone Kelly says:

    Krug is very very good. Unfortunately no one makes a “Krug” like champagne or sparker. It is my favorite champagne, but until just recently I had never bought a bottle.

    Also, the name of the firm is just Krug. It is owned by Louis Vuitton Moët Hennessy.

  5. Andie says:

    I am sorry to inform you that the prestige cuvee you talk of is not by Charles Kru but Krug. Two different wineries in two different countries. The Krug you tasted is their entry wine not their top of the line.

  6. I think the renaissance going on in Champagne right now is that the small owner growers are bottling their own wines and they are fantastic.

    We import about 10 different owner grower Champagnes that start at $30/bottle and none is more expensive than $45 (for the Premier Cru). There are really some excellent values when you move away from the large houses.

  7. Mike says:

    Charles Krug….really????
    There’s a Napa Valley winery named Charles Krug and Champagne Krug, which are you refering to?

    You lost most of your credibilty when you combined the two. They both have such storied histroies, you have to know the story of Charles.

  8. JR says:

    You meant Champagne Krug and at $125 btl, probably their Grand Cuvee selection. Any credibility to make your case was lost when the mistake appeared more than once in your communication above.

  9. Anonymous says:

    I think you mean Krug, not Charles Krug?

  10. admin says:

    My mistake.

  11. gdfo says:

    After 23 years in beverage sales, I can tell you that most of the people I met could not care a hoot about Champagne unless it was a hot seller.
    Other than that the wine drinkers I have met were willing to talk excessively and sometime ignorantly about Chardonnay and Cabernet and Pinot Noir and what ever was fashionable at that timebut rarely Champagne. Yes, I have met some real Champagne fans and they were few and far between and most of them were not in a financial position to buy or drink alot of real Champagne, especially their favorites. For the price of 3 or 4 bottles of real Champagne you can also get 9 to 12 bottles of a Chard or fav Red. In this case Love has a price.

    I have also seen a rise in popularity of wines like Mionetto Prosecco which is alot less $$$ that Champagne. Lots of folks prefer a clean and somewhat fruity wine than a yeasty oxidized wine.

    (I do not care if you wrote Krug..LOL I got the point)

  12. Steve says:

    I’m a 19 year industry veteran with 16 1/2 of those on the winery side. Champagne is my favorite wine bar none. I drink it regularly and buy a lot of it, when it is on sale. I sold Krug for 6 years, when I worked for Remy Amerique. The vintage wines are now unaffordable, which is a true shame. I’ve not had a better Champagne than Krug vintage. I did recently have a bottle of Krug Grand Cuvee and LVMH has completely changed its style under their ownership. I now think it taste like it is a $50 Champagne not a $125+ bottle. I also worked for one of the top sparkling wine producers out of Sonoma. The wines made by this house are very well done and very poplular. The bottom line is that one can’t replicate the true taste of Champagne outside of the Champagne region in France. The only way to come close is to age it for an extremely long time on the lees. A Prosecco doesn’t come close to Champagne or in most cases a well made sparkling wine be it CA, Italy, France or Spain. You just can’t make a cheap Champagne like you can Heinz catchup or Del Monte canned fruit. Costco’s brand of Champage costs $20 for NV and $25 for Rose. The wines are “ok” but their sourcing will most likely change from year to year and the wine maker possibly will change as well. I agree with the comments above about the use of the iconic Charles Krug Winery in CA for that of the ultra iconic Champagne house Krug. Please do a little research the next time before writting such a blog. It will serve you well in the future to not make such mistakes and the points made in your blog might become somewhat credible. Cheers.

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