The Emerging Price Wars Between Water and Wine
I’ve written on numerous occasions that today’s wines are of the highest quality and greatest value in the history of wine.
A mere 50 years ago (which is a small sip in the 6,000-year history of wine), poor growing techniques in vineyards, unclean grapes and adulterated fermented grape juice were the culprits in many off-putting wines sold in the marketplace.
Then the latest generation of winemakers took over the family reins in wineries across the globe. They were eager to learn new techniques and to employ new technology to enhance their wines in order to meet the growing sophistication of wine consumers’ palates. They were critically aware that the success of their wineries depended on expanding their brand recognition and distribution beyond their local and national borders.
In 2021, wine consumers have more choices than ever before, from more regions than ever before, at price points lower than ever before. The value and quality of wines priced at $15 − and below − has grown exponentially in the last 10 years.
A parallel history of water has occurred. Ancient Egyptians, Greeks and Romans cultivated grapes and produced wine as an alternative to contaminated water. As the quality of water began to improve, it was added to wine to dilute the bitter taste and off-flavors of many wines. Medieval winemaking practices dictated a ratio of two to three portions of water to one portion of wine.
In more modern times, water continues to be added to wine to mitigate unwanted components, including high alcohol and undesirable concentrations of naturally occurring sugars. In California, regulators now permit the limited addition of water to wine.
Once water became clean and pure, it slowly became a beverage of choice over other beverages, including certain wines. I remember the first time, which seems like ages ago, I came across a bottle of still water on the supermarket shelves. My reaction? They put tap water into a bottle and expect me to pay for it when I can drink my own (seemingly) free New York City Catskills spring water from my kitchen faucet?
But over time, convenience won out over financial logic, and today I’m buying cases of “spring water” at my local supermarket.
These days, retail outlets are selling “spring water” for about 10 cents a bottle. So, just as quality wines have been declining in price, so has bottled water. And that sounds like markets in perfect sync with each other: higher quality and lower prices.
But there are distinct exceptions to the norm. There are still a few wines in the marketplace where economic elasticity is upside down. Now I’m seeing the same phenomenon for bottled waters.
High-end “designer water,” like Voss, retails for well over $1. Higher-end bottles, such as 10 Thousand BC, drawn from a deep, Ice Age-era Canadian glacier, retail for over $14 per bottle.
In today’s consumer market psyche of “I will outspend you simply because I can” and “I need to have the most expensive product in the market,” it’s difficult to rationalize the price of wine compared to these waters.
When the vectors of wine and water prices cross in a pricing graph, the prices of select waters are greater than that of select wines!
Here’s a case in point:
For years, the price Charles Shaw wines from Trader Joe’s, dubbed “Two Buck Chuck,” have been the darlings of price-conscious consumers. At $1.99 per bottle, the multiple wines bearing this label have sold over 800 million bottles since 2002. Even when the price escalated to $2.49, then $2.99 (it’s still $1.99 in parts of California), Trader Joe’s retained the name – and sales have remained solid. However, in a strange twist of upside-down economics, the Two Buck Chuck on the shelves sells for less than select bottles of water in the marketplace.
The “elixir of life” – wine or water? You decide. Is it composition or economics?
Nick Antonaccio is a 45-year Pleasantville resident. For over 25 years, he has conducted wine tastings and lectures. Nick is a member and program director of the Wine Media Guild of wine journalists. He also offers personalized wine tastings and wine travel services. Nick’s credo: continuous experimenting results in instinctive behavior. You can reach him at nantonaccio@theexaminernews.com or on Twitter @sharingwine.
