Business: The Word on wine -- From sniffing out trends to backing industry analysis with solid data, the Fredriksons are 'the bedrock of wine consulting' Business: The Word on wine -- From sniffing out trends to backing industry analysis with solid data, the Fredriksons are 'the bedrock of wine consulting' (January 26, 2005)

By Renee Batti

Almanac News Editor

Pinot noir fanciers, head to your favorite wine shop without delay and grab up what you can. Come February 27, if the hit movie "Sideways" takes top Oscars at the Academy Awards ceremony, you may be looking at empty space where your cherished wine once was found.

That's the prediction of a Woodside husband-and-wife team of wine-industry experts whose words are considered The Word in the wine world.

The owners of the oldest research and consulting firm in the wine industry, Jon and Eileen Fredrikson are two of the most widely quoted authorities in the business -- sought out for their expertise and analysis, and their ability to sniff out soon-to-emerge trends in the wine business and culture.

"They have been the bedrock of wine consulting," says Mark Chandler, director of the Lodi-Woodbridge Winegrape Commission. They have been "an impeccable source" for anyone seeking industry-related information -- from the media, to grape growers and winemakers, to retailers and importers, he said.

"If you want the straight story, you call Jon and Eileen, and they will give it to you," he says. "They are not spinmasters."

Mr. Chandler's not the only one holding that opinion. A panel of seven wine industry honchos singled out the Fredriksons from a list of 21 nominees as winners of the 2004 Wine Industry Integrity Award, a national honor whose past recipients have included Robert Mondavi, Robert Young of Robert Young Vineyards, and several academics.

The selection panel included wine writer Gerald Boyd, Norm Roby of Decanter magazine, and Peter Granoff, co-owner and partner of Ferry Plaza Wine Merchant in San Francisco.

The award, created in 1998, honors "those individuals who have conducted their careers with integrity while making significant contributions to the wine industry," according to Mr. Chandler, whose organization sponsors the award.

Asked about the panel's choice of the 2004 honorees, Mr. Granoff says: "There are lots of places that you can potentially go for information in an industry like the wine industry. Some of them have an agenda behind the scenes.

"Eileen and Jon's agenda is facts -- and nothing but the facts. No spin."

And besides, "They're just really nice people," he adds. "That's not why you choose someone for an integrity award, but they just happen to be wonderful people."
The view from the mountaintop

Jon and Eileen Fredrikson are no-kidding-around wine-lovers. They are also walking and talking refutations of the stereotype that wine-lovers are pretentious snobs -- their noses in the air when they're not in a glass.

Residents of the Kings Mountain area of Woodside for 25 years, the Fredriksons have been active in their rustic, close-knit community from the start, co-founding the Kings Mountain Education Fund and volunteering in the annual Kings Mountain Arts Fair.

They operate their business out of their spacious home, which overlooks a vast tree-topped expanse of untouched mountain slopes, all the way to the ocean.

When they open their doors to an Almanac reporter and a photographer, they offer warm, gracious greetings then, during an interview conducted in their cozy living room, talk unhurriedly about their work and their pleasures.

But it is clear they are stealing time from a hectic day: Jon is on a tight deadline to complete a report, much anticipated by hundreds of wine-industry players, to be presented at a late-January conference. Earlier in the afternoon, they had a business meeting with an associate, serving lunch out on the deck in the first sun to have warmed the mountain air in days.

Well-versed in the facts and figures of the industry, they offer thoughtful responses to questions about trends and challenges in the wine industry.
Industry powerhouses

The Fredriksons have owned the consulting firm Gomberg, Fredrikson & Associates since 1983. It was started in 1948 by Louis R. Gomberg, a legend in the industry who stayed on as a consultant for about 10 years after he sold the business.

"To work alongside one of the key players responsible for rebuilding the wine industry after Prohibition, and share his vision and knowledge, is something Eileen and I will always cherish," Mr. Fredrikson said in a statement to the commission that presented the integrity award.

The Fredriksons have carried on -- and expanded on -- Mr. Gomberg's work in offering client services in strategic planning; acquisition and divestiture counseling; establishment of wine-marketing relationships; new venture analysis and project management; and wine industry economic, business and marketing studies.

While Mr. Gomberg's expertise was a plus to the firm's new owners, the Fredriksons' own industry experience and passion for wine made them well-qualified to receive the mantle of authority. Mr. Fredrikson was a Fulbright Scholar in economics, and received an MBA from Columbia University.

Before buying the consulting firm, he worked for Joseph E. Seagram & Sons for a number of years. As he was "running around the world" on business, he developed a strong interest in wine, and found he had "quite a great palate," Ms. Fredrikson says.

He managed to get a transfer to California after a visit here. His positions with Seagram included that of executive vice president of the Seagram Wine Co. and Peel Street Wine Merchants.

Once he was officially a California resident, "he ended up marrying a California girl," Ms. Fredrikson says with a laugh. The daughter of a grape-grower, she grew up in Tranquility, near Fresno. After graduating from the Haas School of Business at U.C. Berkeley, she worked as director of operations for Joseph Magnin, then a prestigious, high-end fashion store.

In that glamorous world, "I was in charge of all the unglamorous stuff," she says. "But it was good training for my part in this business."

Ms. Fredrikson's title in the firm is vice president of client services. Although both have been quoted in numerous newspapers, magazines and industry publications, Mr. Fredrikson has been anointed by the Economist magazine of Britain "the leading authority on industry trends."

But Mr. Fredrikson doesn't need a magazine across the pond to sing his praises. His wife is clearly a believer. "Jon's nomenclature, which defined and structured how the industry looks at itself in terms of price segmentation, is likely to be one of his lasting contributions to the industry."

That nomenclature gave the industry standards to categorize wines according to pricing -- from "popular premium" through "luxury." The standards, then, made it possible to collect reliable data on industry economics and trends.

Mr. Fredrikson publishes the Gomberg-Fredrikson Report, which covers wine business trends. Perusers of the 2000 edition of the Oxford Companion to Wines of North America can find a chapter he penned on wine consumption trends.
For the love of wine

Business aside, the Fredriksons are stalwart wine advocates.

"The most exciting thing about anybody's work life is when your work is both your vocation and your avocation," says Ms. Fredrikson. "And that's how we are."

"We're really kind of wine advocates for the country," says Mr. Fredrikson. He predicts that an upward trend in wine consumption in the United States is likely to make "the U.S. the largest wine-consuming country in the world." That's in terms of volume, he adds, not per-capita consumption.

While Mr. Fredrikson sits on the board of directors or advisers of several California wineries and is a certified judge at the California State Fair, Ms. Fredrikson has devoted much time and energy to the NorCal chapter of the American Institute of Wine & Food, founded by Julia Child, Robert Mondavi and Richard Graff.

She served as president of that organization for a number of years, and she created and directed its NorCal Wine School programs -- all non-paid activities.

A believer in the virtues of wine as a food, Ms. Fredrikson also was vice president of Women for WineSense. During a period of "neo-prohibitionism" in the 1980s, when the government was pushing for "sin taxes," members of that group "took the cultural message of wine at table to D.C," she says.

The message? Countries where kids grow up with parents modeling behavior of drinking wine at the table "are places where alcoholism is not a problem," she says.

The trend spotters speak

When Jon and Eileen Fredrikson speak, the wine industry listens.

"The Fredriksons' accuracy is unmatched," says Mark Chandler, director of the Lodi-Woodbridge Winegrape Commission. "It's the quality of their sources and the quality of their analysis that sets them apart."

And the data they provide, he adds, "has tremendous impact on the future," helping those in the industry make the correct strategic decisions -- concerning all aspects of the business from the vineyard to the marketplace.

So what trends do the couple see for the future of wine and the industry? Here are a few on top of their list:

** "Echo boomers." A growing new base of "echo boomers" -- children of baby boomers -- will spark a new cycle of wine consumption that will begin with trendy new wines branded "lifestyle" and evolve to upscale, fine wines. "There is growing evidence that the echo boomers are adopting wine at earlier ages than the preceding 'Generation X.' Echo boomers make up 27 percent of the U.S. population, and their choices will dictate the success of many consumer products in future years," writes Eileen Fredrikson.

** Better quality wines. There will be a continuing rise in the quality of wines being produced worldwide. "The quality bar is being raised every year, so it's downright difficult to find a wine these days that has serious quality defects," Ms. Fredrikson writes. "Better quality wines and styles (along with some bargain prices) are attracting more consumers."

** Global wine companies. "We're seeing a rash of mergers as the giant wineries fight to gain market share," Ms. Fredrikson writes. "This bodes well for consumers because competition will remain intense for the next few years."

** Pinot frenzy. The movie "Sideways" has already won a number of film industry awards, and the Fredriksons predict a spurt in the popularity of pinot noir -- fancied by the wine-connoisseur character Miles in the movie. "If (the movie) wins an Academy award, look for pinot noir shortages on the shelves."

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