db interview: Thomas Domeyko, Concha y Toro

It’s not completely inconceivable that Thomas Domeyko could one day become the next CEO of Concha y Toro, Chile’s largest wine producer.

Thomas Domeyko, Concha y Toro’s corporate export manager for the north

That might be a bold statement, but this is a man that has, after all, spent more than two decades at the company, working his way up from assistant finance manager to the lofty heights of corporate export manager for the north, reporting directly to the company’s longstanding, and well-respected, CEO Eduardo Guilisasti.

While speculation about his potential future CEO status is, of course, pure conjecture, his ascent through Concha y Toro’s ranks has been impressive. Having joined the company in January 1994 Domeyko has taken on a number of senior positions, which have seen him launch the company’s first Argentine winery, Bodegas Trivento, and help its Casillero del Diablo brand reach an export volume of five million cases worldwide.

As manager of international business, Domeyko was instrumental in establishing the Almaviva winery – a joint venture between Baron Phillip de Rothschild and Concha y Toro – and Concha y Toro UK in 2000, with offices in Sweden, Finland, South Africa and Canada soon following. Stepping out of Concha y Toro to lend his expertise to the wider Chilean wine industry, in March 2011 Domeyko became a board member of Wines of Chile.

It’s an impressive resume for someone who admits he had “zero” experience of wine when he joined the company at the age of 27. Back then he admits he would have been more likely to have asked for a beer than glass of Terrunyo Carmenère, the drop he credits with turning his palate onto wine.

Sitting down with Domeyko on an unusually cool evening in Santiago’s El Mestizo restaurant, overlooking the city’s Bicentenario Park, his passion for Concha y Toro, and support of the wider Chilean wine industry, is clear.

“It’s been 22 years and it would be difficult to leave the industry at this point”, he admits. “I couldn’t picture myself doing anything else.”

On joining Concha in 1994 Domeyko said he was “lucky to be at the right place at the right time”, with the group then in the more formative stages of expanding its vineyard holdings across Chile.

“It was the beginning of the modern investment plan of the company”, explains Domeyko. “That’s what brought the resources to be able to invest heavily in land and winemaking facilities in Chile and Argentina. Our strategy was to invest in land and vineyards spread out across Chile, trying to have the best vineyards for each variety.”

Since then Domeyko has navigated a number challenges, not least overseeing the company’s first international investment in Argentina by launching Vina Trivento. Domeyko moved to Argentina in 1997 to serve as the winery’s general manager, a time he describes as “crazy”.

“I arrived there with another Chilean and there was nothing there. We had to do everything from scratch; defining the brand ranges, vinifying and buying grapes. It was hectic. We had a lot of help from Concha y Toro in Chile. It was hard work, but fun. “

Today, Concha y Toro’s Trivento Reserve Malbec is the UK’s top-selling Malbec, growing at over 143% in value and 146% in volume over the 52 weeks ending 2 January 2016, according to figures by market research company IRI. As of 5 December 2015, its Trivento brand held a 17.6% share of all Argentine wine sales in the UK off-trade.

“Probably we did it too early for the consumer to be ready, but now is the time”, says Domeyko, with Argentine Malbec now flying off the shelves in the UK.

However the biggest challenge faced over his 22-year career, according to Domeyko, has been convincing consumers that Chilean wine can be “much better than a good value wine”, referencing a hangover from its initial high alcohol, budget-buy heyday, particularly in the UK.

Concha y Toro’s Pirque vineyard in Maipo

“Chile initially built its reputation on good value varietal wines”, says Domeyko. “We became known for producing good value, reliable, everyday drinking wines, but that was 20 years ago. Since then with all these investments we have entered a modern era, producing really good international wines. We are at the same level as any wine producing country, but the amount we sell in the UK is relatively small compared to Australia and California.”

In the past five years the Chilean wine industry has pushed further into this ‘modern era’ with a focus on innovation and region-specific wines taking centre stage. Domeyko cites Concha’s Marques de Casa Concha Pais/Cinsault blend, made from 100 year-old dry-farmed País vines in Maule’s Cauquenes Province, and Cinsault from 50 year-old vines planted further south in Chile’s Itata Valley, as an example of the company’s efforts to innovate. Launched with the 2014 vintage, the wine is produced using carbonic maceration and retails for around £9-10 in the UK. However such wines cater to a currently “niche” proportion of consumers, says Domeyko, who believes that big brands are still the driving force of the Chilean wine industry. Consequently, Concha y Toro’s current strategy is to build innovation into its existing brands, rather than creating entirely new concepts.

“There is a niche, relatively small segment of shoppers that are looking for experimental wines”, he explains, “but in the end I think there is a much larger group of shoppers that are just looking for a good experience, trying wines and varieties they know such as Cabernet Sauvignon and Merlot. Through the brands we can engage with more consumers, taking a trustworthy approach. Something they can rely on so they can then approach Chilean wines at a higher price point.”

Concha’s flagship Casillero del Diablo brand certainly seems to be striking a chord with consumers, selling more than five million cases globally for the first time last year. It also became the sixth biggest wine brand in the UK in 2015, overtaking Jacob’s Creek. For the first time, Casillero del Diablo topped £100 million worth of value sales in the UK off-trade within a calendar year, growing by 18.3% in 2015 compared to the previous year.

“I remember when we celebrated one million cases sold, and then it was two and now we are at five”, says Domeyko. “Every time we thought the next milestone was impossible.”

Concha y Toro’s casona in Maipo

And while many of Concha y Toro’s wines have regional specificity – Casillero’s Cabernet grapes for example are sourced from the same vineyard in the Maipo Valley each year – it’s not always the brand’s top line, explains Domeyko.

“It’s a difficult balance because there are a group of consumers that are knowledgeable and we have to provide for them that regionality and things that are new and fun, he says. “But there are also many consumers that don’t want things to get so complex. One of the things that makes them run away from the wine aisles is the complexity of it.”

Putting this into context by referring to a personal experience, Domeyko described a recent visit to Peru where, having enjoyed the country’s top tipple, Pisco, decided to take a bottle home with him.

“I started to ask a couple of guys how to make it, which Pisco to have and it was the same thing as with wine”, recalls Domeyko. “They said you have to have this variety that grows here because it’s better or that variety because of this. I got to duty free and looked and there was a 10m wall with 10 different varieties of Pisco.”

Dumbfounded by the choice on offer, Domeyko ultimately left empty-handed.

“I was scared to make a mistake and buy the wrong one, that wouldn’t be like the Pisco I had enjoyed”, he says. “As an average consumer I found it overwhelming and didn’t buy any. Consumers look at this wall of wines, which is 30m long, with appellations and regions and varieties, 50 at least, and they think ‘I’ll just have a beer’.”

His comments echo a trend in the UK that has seen discount retailers Aldi and Lidl grab an increasing market share by adopting Every Day Low Pricing and reducing the number of products on offer. Fighting back, some of the UK’s major retailers are shrinking their wine ranges in a bid to drive sales and reduce choice in the aisles.

“I give sophisticated consumers what they want but also give the normal consumer what they are looking for and not confusing them so much”, says Domeyko. “I think that brands have a key role to play in that”.

Looking to the future, Domeyko has his eye on further global domination. Hoping to replicate the success of Concha y Toro UK in other markets, Domeyko shares his ambition to build on the company’s portfolio of distribution offices already operational in Sweden, Finland, South Africa and Canada, and push Chile faster and further than ever.

“It’s about getting deeply involved in the market and understanding what the consumer wants, putting consumers at the centre of the equation and adapting the strategy from each country. Chile has the capacity to go as far as it wants”, says Domeyko, who adds: “Nothing is impossible if you want to do it.”

Biography – Thomas Domeyko Cassel – Corporate Export Manager, North

• Studied commercial engineering at the Universidad de Chile.
• 1994 – joined Concha y Toro January 1994 as assistant finance manager.
• 1996 – appointed manager of international businesses, working to establish the Almaviva winery – a joint venture between Baron Phillip de Rothschild and Concha y Toro.
• 1997 – transferred to Mendoza as general manager of Viña Trivento, with the responsibility of initiating and organising the company’s first international investment in Argentina.
• 2000 – appointed export director for the north zone
• 2006 – appointed corporate export director for the north zone
• Since March 2011 Domeyko has been a member of the board of Wines of Chile.