CHILE PINOT NOIR: Grape expectation

Hard to grow but hugely popular with consumers, could Pinot Noir hold the key to Chile’s development? Patrick Schmitt assesses its potential

­What is it about Pinot Noir? Is it the style of wine it produces? Its Burgundian roots? Both of these and more? For the sake of this feature, it doesn’t matter. The fact is, Pinot Noir is popular. Just mention the grape and wine lovers’ curiosity is aroused, knees weaken and mouths begin to salivate, dog-like. The grape is also considered upmarket and conveniently appeals to both sexes. Can Chile, by association, harness these Pinot qualities?

Chile hardly has a hip or upmarket image in Britain. The country’s reputation for quality and reliability at mid-market prices is commendable, but also limiting: it is preventing Chile from being seen as a fine wine producer, an innovator, a place of diversity. How can Chile take the next step and become known for something more than good-value, well-made Cabernet Sauvignon? Generic marketing is one solution, and brands another. But many are suggesting Chilean Pinot Noir can unlock the gates to Chile’s next stage of development.

How? “Pinot Noir is a conduit to the next level,” says Greg Wilkins, director, Brand Phoenix, “It associates Chile with innovation and something more expensive.”

Importantly, Chile is proving adept at producing high-quality, good-value wines from this hard-to-please varietal, and in the process drawing attention to the country’s cooler-climate regions. This is also highlighting Chile’s potential for lighter, fresher styles of wine – be they from Sauvignon, Chardonnay or Merlot.

Pinot Noir’s popularity is, in effect, putting Chile’s regional proposition on the proverbial map. As Julie Ticehurst at the Great Western Wine Company says, “Pinot is a real opportunity for Chile to establish the message of regionality on the back of the success of Pinot plantings.”

Sex appeal
Pinot Noir may also bring more women into the Chilean category. Patrick McGrath MW, managing director at Hatch Mansfield, UK agents for Errazuriz, mentions research which shows that “Chile needs to engage with female consumers – the country has been more male biased to date because of the emphasis on Cabernet, Shiraz and Carmenère. Could lighter wines, such as Sauvignon Blanc and Pinot Noir, change that?” he asks.

In any case, as Wilkins reminds, “There is a consistent trend towards lighter wine styles and success will go to the producer who most accurately reads and meets those trends.” If that’s Britain’s on- and off-trade, then certainly Pinot Noir, Sauvignon Blanc and rosé are on the rise. So too is the other Pinot – Grigio. But it is only Pinot Noir that consumers expect to be more expensive. “If Chilean Pinot Noir picks up it will lead to a trade-up in Chile,” says Wilkins. “That wouldn’t necessarily happen with Merlot, Cabernet Sauvignon or Chardonnay because they are not as transitional with the consumer as Pinot Noir.”

However, Chile must be careful not to become backed into a corner when it comes to the price of its Pinots. The country is already developing a name for inexpensive versions, or rather, good-value Pinot, especially compared to New Zealand, where prices are escalating.

Rising costs for New Zealand Pinot is of course an opportunity for Chile, but it should not enter the market at too low a price. McGrath suggests Chile should aim for the £7 to £10 market, undercutting most Pinots from New Zealand. “The difficultly,” he says, “is getting enough growers to plant Pinot Noir. The problem is the same in New Zealand. Growers think ‘I’m getting safe returns from Sauvignon Blanc, why risk Pinot?’ And in Chile you’ve got to keep the yields down.”

Price advantage
At the moment, those really pushing Pinot are selling their entry-level versions below McGrath’s £7–£10 window. In fact, the main names in Pinot all seem to sit in the £5–£7 price band, from Cono Sur to Porta, Errazuriz, Casillero del Diablo and even William Fèvre’s Don Victor Pinot Noir – a Burgundian-Chilean joint venture. Could Chile’s success with the varietal simply be because the country regularly offers Pinot at the lowest price? Opinions vary, and some suggest consumers are genuinely seeking Chile plus Pinot on the label. “There is definitely an appetite for Pinot Noir from any country as long as it has the characteristics of Pinot Noir,” says Wilkins, adding, “but when it is from Chile, the security the country gives the consumer adds another 20-30% to the decision – they think it’s going to be reliable and interesting.”

For Richard Leaver, UK commercial director for Santa Rita, “There is a real sense Pinot Noir from Chile is appropriately priced.” When it comes to French Pinot, entry-level Burgundy in particular, Leaver says that it is perceived as “less approachable”, although it can compete on price.

Nevertheless, in terms of varietal association, “Cabernet is really Chile’s major stamp,” according to McGrath. “As well as Merlot, or a blend of Merlot and Carmenère.”

“The great thing about Chile,” he continues, “is that because of the climatic orientation of the growing regions it can have a multitude of strengths: it could be known for top-quality Pinot Noir and Sauvignon Blanc and carry on its success with Cabernet, depending on whether you are closer or further from the coast.”

In this geographic sense, McGrath adds, “Chile can rival what goes on in California.”

Vital role

Looking to the near future, Pinot Noir can perform a vital role for Chile. With more plantings, and increasing vineyard age, Pinot Noir from Chile looks set to increase in quantity and quality. As more consumers associate Chile with the variety, the country can prove its ability to diversify and produce lighter wine styles. It will also help highlight existing and emerging wine regions, encourage consumers to spend more on the category, and possibly accelerate an image change for Chile and make it appear a little more exciting.

In particular, the appearance of relatively cool-climate areas such as Leyda, Limarí, Elqui, Bío Bío and San Antonio, helped by Pinot’s popularity, will increase Chile’s on-trade credibility.

“Chile has achieved its primary aim, which is distribution and market share, and the consumer is very positive about the country,” sums up Wilkins. “But, Chile is not associated with innovation and new product development and Pinot Noir – as well as more rosés – could take Chile to the second and third phase in its development.”

© db September 2007