GLOBAL: E&J Gallo Winery hails family ownership

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E&J Gallo Winery's vice president of marketing has extolled the virtues of family-owned companies in the wine industry.


Gallo is once again the world's largest winemaker by volume, following Constellation Brands' decision to sell its Australia and Europe wine business to CHAMP Private Equity. That deal's bargain-basement AUD290m (US$290m) price tag, coupled with a slump in profits at the division, has rekindled talk on whether the wine industry is suited to publicly-owned companies.

Gallo's marketing VP, Stephanie Gallo, waded into the debate today (22 February). "We're going to remain a family-owned and operated company," she told journalists at a briefing in the UK, the firm's largest export market.
"Family ownership is critically important to our success," said Gallo, who is the grandaughter of Gallo co-founder Ernest Gallo. "It enables us to innovate and develop relationships for the long-term, without having to answer to the demands of Wall Street."

Gallo has 16 members of the founding family who actively work at the group, which employs around 5,000 people worldwide. The company accounts for 53% of California's wine exports by volume. 

However, despite the firm's proclamation of success, it declined to give specific sales and profits figures for 2010 when questioned today. Bill Roberts, Gallo's VP and general manager for Europe, the Middle East and Africa, said of 2010 sales: "Globally, we definitely grew."

The group said that, in the UK last year, 88% of its wines were sold above the GBP4.58 (US$7.40) average price point for a 75cl bottle. 

Gallo is planning several marketing campaigns in the UK in 2011, including support for the launch of its Summer Red chilled red wine. It is also planning activities around a new Merlot variety of Gallo Family Vineyards rosé and around its Barefoot brand. The firm declined to say whether it is increasing its marketing spend versus 2010.

Rosé wine has motored in the UK over the last few years and Gallo claimed that its Gallo Family Vineyards rosé was the number one rosé brand in the country's off-trade last year, notching up sales of around GBP72m. It said that Diageo's Blossom Hill was second, with sales of around GBP69m.

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