Key development: Developed varied portfolio of premium and popular wines.
What's next: Promoting total store sales.
Joe Gallo is no wine snob. He's committed to making wines approachable to oenophiles and novices alike. And he wants E.&J. Gallo Winery, Modesto, Calif., to give consumers the knowledge and ability to purchase wine with confidence.
"We have developed a diverse portfolio of premium and popular brands to introduce more people to wine, as well as to meet the evolving needs of an ever-growing base of wine consumers," Gallo told SN.
A big factor in E.&J. Gallo's success is that it listens to consumers, said Gallo, the son of co-founder Ernest Gallo. When consumers became more interested in foreign wines, the winery began importing. Among the company's 45 brands are Red Bicyclette from France and Black Swan from Australia.
E.&J. Gallo has also done much to create global demand for California wines, and exports more California wine than any other winery, he said.
Retail marketing plays an integral role in its operations. E.&.J. has worked to build the category through cross-merchandising programs that help demystify wine for shoppers while providing a higher basket ring.
Its latest such effort provides retailers with nonbranded in-store signs reading "Don't Forget the Wine" that are meant to be placed around the store.
"Wine Everyday," a partnership with Wine Spectator magazine, makes premium wine more accessible through a monthly wine and food advertorial, along with related in-store merchandising.
Such programs have helped make Gallo the largest U.S. producer based on volume, according to Impact Databank, New York, a wine and spirits research database. It recently lost its position as the world's largest wine producer to Constellation Brands, Fairport, N.Y., which produces and markets such wines as Alice White, Blackstone and Franciscan Oakville Estate, as well as spirits and imported beers. Constellation has been an aggressive acquisitor, most recently buying the Robert Mondavi winery.
E.&J., too, has made considerable acquisitions. Gallo said competition leads to better-quality products and more consumer choice.
That kind of attitude may help the company deal with other challenges that come its way, like a boycott initiated last month by the United Farm Workers of America. The UFW wants Gallo to do more for temporary employees in Sonoma County who represent a large percentage of the workforce yet receive no benefits or job protection, according to the union.
The winery says contract discussions are continuing, and hopes an agreement can be reached. Representatives from Gallo, the UFW and a mediator met last month to discuss a number of issues, according to Gallo. Another meeting was planned for July 21.