A little slice of paradise

A little slice of paradise
Kim and Erica Crawford sold their wine label in 2003 for stacks of cash. Now they're pouring their dollars and passion into a new label, called Loveblock.

"That brand,” says Erica Crawford.

The words are loaded with meaning. It isn’t just any brand she’s talking about when she says the words – “that brand” – but rather, a brand whose name she won’t articulate. Not out of hatred or anger, but predominantly respect, tinged with perhaps a little bit of fear. That brand is, of course, Kim Crawford Wines, named after her husband and sold to Canadian company Vincor in 2003 for $14.8 million. It’s a household name and one of our more astounding success stories, given the sale was for the name only – no winemaking equipment, vineyards or even a bunch of grapes were included in the deal.

But selling a brand name that was his own name means both Crawfords need to be extremely careful with their public image. Late last year Erica tweeted about their new venture, Loveblock, proudly telling followers it was bottling day for their new organic Sauvignon Blanc. She soon deleted the tweet, preferring to err on the side of caution. Because of the Vincorp deal, the Crawfords can’t use their names to promote any other wine.

Did Constellation Wines – the now-owner of Kim Crawford – bring in the heavies to instruct her to delete the tweet? Not so much. Crawford says she hit the delete button because she simply wasn’t sure.

“Obviously we signed a contract and those things are confidential, and obviously we respect that clause,” she says. “We have a very good relationship with Constellation and we’re respectful of the fact that they’ve paid a lot of money for the [Kim Crawford] brand.”

The world has changed since 2003, when the Crawfords sold. When they signed the contract, there was no Twitter, no Facebook. No parameters for social media usage once one has sold one’s name to a company. Currently, it’s a bit of a grey area.

“I should also stop using that Loveblock handle [@loveblockwine] for my own personal opinions ... [for] criticising things like New Zealand cricket for being a bunch of babies.”

I check Crawford’s Twitter a few days after interviewing her to see “2013 Sauvignon in the tank. Really good flavours #v2013”, so perhaps she’s mellowed her approach since our conversation.

If she had her time over, she’d do it differently. “I’ll never do it again,” she says determinedly to me when I ask about selling the Kim Crawford name. Why?

“Three things,” she says immediately. “It is quite hard to exist without being able to use your name. I think it is usually assumed that if you sell something like that you will just go and retire on a big yacht and smoke cigars and sit in the Mediterranean, but I don’t think we’re old enough.” (They aren’t.) “To work in the same industry does make it quite hard.”

For the buyer there are also issues. “You’re sitting with garbage from the past about a person. Kim is nothing like that brand. So someone starts up again, so how do you balance the two? And also, if Kim goes on an axe murdering spree or something, what will happen to that brand? That personal brand thing, I won’t do it again. I think it’s too complicated.”

She points to Kim’s Facebook page. It’s not private, and there are no hints of axemurdering tendencies. “Oh and you can LIKE the Loveblock FB page, whatever that means,” says one of Kim’s status updates. “Funny, Erica’s hovering over you huh?” writes a friend, making light of Kim’s apparently dislike of technology. (“I have an iPad thing, comandeered by teenagers. Very good games on it,” reads a telling update.) He, too, has to be careful, says Erica.

“But you make personal statements. You say things. It is a grey area. I think as long as one is respectful and you don’t ride on their brand for the success [your own].”

One wine icon to another

Loveblock, the Crawfords’ new venture, has a couple of different homes. They host journalists for lunch at their Remuera home, while the label’s vineyards are on a tricky patch of land in Marlborough. The day job, though, is done from an office in Parnell’s Axis building. Unsurprisingly, one of the few places you can get a glass of Loveblock in New Zealand is at Cibo, the restaurant downstairs, frequented by lady lunchers and smart advertising types.

Amongst a stack of books on the window sill is Taste: A Life in Wine by Anthony Terlato. It’s probably fair to say that most of the journalists who were hosted at the Crawfords’ place for lunch had never before heard  of Terlato, but in his native America he’s a renowned wine expert and an icon of the industry. He brought Italian Pinot Grigio to the US and made it the most popular imported wine in US history, and is now the agent for seven percent of the North American market for bottles of wine in the plus- US$50 mark. He’s also, understandably, extremely rich. So it’s something of a premature accolade that the Crawfords have already signed a long-term partnership with Terlato Wines International to market Loveblock in North America. Crawford makes the partnership sound easy – a product of happenstance, even.

“I guess they heard that we were thinking of growing ourselves and we were looking for someone, and there was a by chance conversation and away we went.”

Route to market is the first and most important thing in setting up a brand, says Crawford. “And we’ve sorted that.” 

Next, getting the financials in a better state. “That will come. We haven’t really started selling wine. And you’ve got to remember with agriculture and something like wine, it’s five years before you can actually start selling stuff. It is very long-running. Our books will start looking better now.”

It’s terrifying sometimes, she admits. “Because this model is completely different to what we did before.” (Kim Crawford Wines didn’t own land, preferring instead to buy in grapes from other growers.)

The Loveblock journey goes back to early 2000, when the Crawfords were still fully in charge of Kim Crawford Wines. They bought 15 acres of land in Waihopa Valley, followed by 400 acres in 2002, having to get permission to do so. Essentially, they wanted their own patches of land in order to secure supply. Later, with “a little bit of money” from Vincor, they bought the third block out of the old Oak Brook Estate. It’s on top of a hill with a beautiful valley; the valley floor is planted and for Loveblock, the hilly terrain presents challenges. It’s a different growing environment and a different climate to the valley floor.

Regardless of the challenges, Erica fell in love with it – hence the name. They’d just sold to Vincor and were riding high on success.

“We were a little bit 10 feet tall and bulletproof. So we bought this piece of land – and it really was a case of falling in love and being infatuated. I looked over the hill and it is absolutely beautiful. And then there was the challenge, because it is so different to the soil down in the valley floor and we thought that we could get some extraordinary flavours from there.”

Earmarked organic

The twist to the story of difficult terrain is that the Crawfords decided Loveblock would be organic. From the beginning, the land was earmarked as organic. It’s a passion for Crawford and part of her personal philosophy. And part of a personal awakening; in her early 30s she was in a car accident, which took its toll on her physically and emotionally. It was a time when they were living really hard – not only looking after little kids but also driving the company as hard as they could. Crawford lived on Red Bull, Coke, coffee and meat pies. After the accident, the medics said her heart was beating like a 55-year-old stressed-out businessman. It was a wake-up call for Erica.

“I just had to start looking at what I take in, and the first thing I started cutting out was additives. I don’t think I’ve drunk Coke in years now. And then I cut out colouring. Then I started feeling better. Of course everybody would like to be skinny, but I don’t necessarily eat to look good – I eat to feel good.”

Crawford started feeling “less uptight, for sure” and paid more attention to ingredients and chemicals. A decade or so ago, she might have seemed hippyish.

“There is something like 75,000 chemicals that has been approved in the past how many decades. We don’t know what it is doing, you can’t control what is coming out of a paint. You can’t control what is coming out of PVC in your building and stuff – you can’t control that. My view is that the only things I can control is my immediate environment; what I put on myself and in myself. That is really my focus right now.”

Eventually Loveblock will focus on becoming carbon-neutral, but the first port of call is getting the vineyard up to the standard it should be in terms of soil fertility and other such winemakers’ concerns. The difficult terrain presents an “imbalance”.

“As a commercial crop, it is producing well and making money, so the soil is fertile. [But] it is a really hostile growing environment up on the hill. It is windy so those vines really struggle to work well. The easiest thing to be  would just be to spray them and give them a chance to be strong. Remember, we planted everything from scratch, so that is what I mean – in balance.”

The normalisation of organics is one thing, but the commercial reality is another.

“There is money to be made, but further down the track,” Crawford says. “Break-even is much later. Further down the track once the numbers balance and you’ve got a commercial viable crop, then other things decline, like your need for what you do with the soil. There is a crossover point for us – it is a little bit further in the future, probably another four years.”

Still, while Loveblock currently has a point of difference in organics, it may not be too long before the big operators are jumping on board.

“On the flight from Blenheim it’s always full of wine people. I sat next to a guy from one of the big companies, also dabbling with organics. The big companies are driven by the balance sheet. Of course, the crops are lighter, much lighter. For him, head office looks at it and says ‘We’re doing it’ or ‘We’re not doing it’. We came to that point that if you do it it really is a philosophical thing, I think it has to be. It is definitely more expensive to work the land and to get your crop. Commercially, it has to be a deeply philosophical thing – and most people I know who do it do have that.”

Crawford admits they’ve made “stupid mistakes” in their time. “If we’d asked people…” she trails off. “They probably would have advised us to grow the vine up and along the wire before you convert to organics. Especially where we’re growing it. The farm out there is quite stripped of nutrients. We should have spent more time with the soil – those things we should have paid more attention to.”

Designing a brand

Beyond organics, another trend Crawford is seeing is the provenance of products – and the canny use of marketing to get that message across the consumer – as well as artisan goods.

“What we see as a trade is that people want to know that you’re going to be there, they want to know that people are investing in their industry and they want to know that that whole provenance thing. I see at the luxury end, that whole butcher, baker, candlestick maker thing is coming back quite nicely.”

The Loveblock look taps into that. Crawford shows me a large roll of paper, unrolling it in the office hallway, with individual bits of paper stuck onto it and a bottle of Loveblock on each corner to stop it rolling back up. It essentially represents the brand’s journey from concept to market and illustrates how it’s evolved. They started this around 2009, with Loveblock as a name already decided early in the process.

“It was costing so much money – you do it for love and you certainly don’t do it for money.”

They started doing “a bit of grunt work” about what the brand actually was and some keywords around it: Artisan, enduring, essential, “all that sort of bullshit”. (Crawford asks me not to put any swear words in, but I think it illustrates the down-to-earth nature of the business at hand.) Then they looked at territories for discovery, pulling Auckland design and advertising agency Special Group in to help.

They tried a tapa cloth look but it was deemed “a bit hippyish”, “too polarising”. They asked artist John Pule to look at the assignment and more concepts were tossed around.

“What we were missing was an emblem – something you could hang your hat on.” 

Yet another artist tried to execute the concept of wild flowers with the masthead. It didn’t necessarily work. Flowers can be too feminine and hence potentially offputting for the male Sauvignon Blanc drinker.

“In the testing what came back very strongly was the branding – you can’t make it look too sissy and too girly, so the branding had to be quite masculine.”

The final version – they came full circle, with Special Group designing the successful end product – was painted by an artist in Wanaka.

“I have never worked this hard at a brand,” Crawford says. It was about eight months of work, in total, just to get the branding exactly right. “Before, I would have just put that one out and believed in myself. It was definitely the right thing.”

Crawford and I remove the wine bottles and roll the paper up. “And we haven’t shown proper people this have we, Rebecca?” Crawford asks a co-worker. I, a mere journalist, am gratified to be classed as a proper person. It certainly beats the abuse you usually get.

People eat, do, wear and buy brands

So much work for one little organic New Zealand wine brand. But branding is what it’s all about, Crawford says. People eat, wear, do and buy brands, she says. It’s the power of the brand, first and foremost. 

“I think people are very loyal to brands. I’m a big proponent for brand because I think that there are so many products out there. Why does this one sell more? Two things – brand equity and distribution.”

She’s a fan of Dan Buckley, of Huffer and Thing Thing fame, having given him a loan to help him out in his entrepreneurship. Donna Karan. Bobbi Brown. World. “I like World because they really push boundaries but they also know where their bread and butter sits and how to make clothes. Not every 25-year-old can afford a $1,000 jacket every year. They know where their money sits.”

Looking back to the Kim Crawford days, she reckons they did a lot of things well but also had quite a bit of luck. When they started in 1996, there were around 100 or so wineries in the country. Now, there are 700. So how did they get lucky?

“Everybody went to the UK and we went to the US. I think we were third entry into the US. So we’ve been in the US since 1997, so it wasn’t an overnight success when Constellation took it. But wow, is it cluttered now.”

Moreover, they already knew exactly what their costs were, how they were going to sell it and where. Capital investment was low and return on investment was high. A dream, essentially.

But most of all, route to market is the big thing, and one that Crawford mentions several times. (They’ve got it wrapped up in the Terlato deal, so they’re sitting pretty.)

“You need to have a route to market sorted out before you even start. Look at the scenario that often happens. People have a vineyard or they are a winemaker and they want to make their own brand. There are some fantastic things – really cute things happening. So you buy or grow the grapes, you pick it, then you put it in a bottle and you stick a label on it – what then? You are sitting with a lot of bottled stock.

“One of our biggest challenges in New Zealand is sorting out the route to market. There are lots of organisations who are actively helping with that, such as NZTE. From New Zealand we export, so it is more important to us than anybody else. But if you choose the wrong partner and it takes a while to extract, and then it is a year or so to readjust on the shelf, you lose sales and you lose shelf space and then you’ve got to regain it. It is commercially quite difficult.”

The North American consumer has a different take, which presents more marketing hurdles. “For us, luxury is down on your luck. You go in your flip flops and your t-shirt and you do a BBQ on the beach. Whereas for the North American consumer it is more sophistication of a grand table. It is just different things. So you’ve got to know that you’ve got to watch your language, you’ve got to watch the way you present yourself – don’t talk politics, don’t talk religion. There are cultural sensitivities and I think sometimes we’re a little bit too naïve around that.”

The cultural divide between New Zealand and America was evident at Crawford’s media lunches with Terlato. A quiet, reserved, well-spoken gentleman, he excused himself to the group before using a mild expletive. Most of us would produce more colourful words in the hearing of children on a regular basis. “I really had to check myself when Mr Terlato is in town,” she says. “He is old-school, elegant, gracious. Not everybody is like that, but I think that we have to consider the consumer and often you don’t just find people who think, ‘The wine is good, so I’m going to buy it’.”

Beyond route to market, you’ve also got to have your story sorted out. You can’t go in and say, “Hey, we’re from New Zealand”. That’s yesterday’s story, says Crawford. “You’ve got to go in there with some collateral because PR is very important there. You don’t just phone up a journalist like we do here – no.”

Crawford says she doesn’t ordinarily use PR, but thought it important enough around the launch of Loveblock to employ Auckland agency Pead PR. “I know Deborah [Pead] personally and I think she is very organised and she is very direct and she is very focused.”

States-side, every distributor, importer or winery has a PR person. “It’s amazing. It is just the way they do it.” Special, meanwhile, came recommended as a good design house. “I think they designed a spectacular little label.”

For the immediate future, they’re focused on loading the pipeline at the moment in the US. Production for the first year is 10,000 cases.

“I can’t be presumptuous enough and say it is going to deplete well – I don’t know. But the serving in is going really well. If you get to a certain stage in the US you work through the three-tier system, where in each state you have to sell to a distributor. So it goes supplier, distributor, account, consumer. It is quite sensible in that it protects the integrity of the supply chain.”

And looking into the crystal ball (she doesn’t have one on her desk, but perhaps she doesn’t need it), where might Loveblock be five years from now? “I think five years is going to come sooner than you think, because I think our biggest problem is staying organic and having volume requirements. Obviously you’re capped, because it is estate and you only get X amount. After this vintage we’re going to have to sit down and think, do we buy more vineyard land, do we work with growers and convert existing [land], because we have a few little holdings in other places. Let’s just see how it depletes and sells through. I’d like to stay on that platform of organic but we’re going to have to invest more if we do that.”

And of course, being careful what she tweets and posts on Facebook. But that might not be too much of a problem.

“I find Facebook quite boring … don’t you?”