How Paul Giamatti broke the California wine industry
New data on the Sideways effect
The movie Sideways, a comedy about a neurotic novelist on a soul-searching trip through California’s wine country, became a bit of a sensation among a certain class of Americans in 2005. It took in over $100 million at the box office and won a whole bunch of awards. It’s best remembered today for an iconic scene in which Paul Giamatti’s main character goes on a brief expletive-ridden tirade against Merlot right before a high-stakes dinner date.
These roughly five or six seconds of dialogue had a profound effect on popular perceptions of Merlot and, in turn, on the entire California wine industry. According to a new study published in the Journal of Wine Economics (no, I did not make that up), in the years following Sideways’ release the price of Merlot fell and California wineries converted thousands of acres of Merlot grapes into the varietal preferred by Giamatti’s character in the film: Pinot Noir.
The effects are plain enough to see in the chart above. Prior to the movie’s release in 2005 Pinot noir and Merlot were on similar growth trajectories. The authors also tracked a third red variety, Cabernet Sauvignon, as a kind of simple control.
But by 2010 Merlot’s growth trend had fully reversed, while Pinot Noir plantings accelerated. Cabernet Sauvignon, which wasn’t prominently discussed in the film, was essentially flat. Those trends continued for the next five years as well.
These long time horizons are important, the study authors explain, because it typically takes around five years between when a wine grower decides to plant a new variety, and when those vines bear fruit that’s ready for market. The industry doesn’t turn on a dime, even if consumer preferences do.
The net result is a radically different California wine industry. In 2005, for instance, growers produced nearly five times as many Merlot grapes as Pinot. By 2017, Pinot Noir production surpassed Merlot for the first time and hasn’t fallen behind it since.
The study underscores how real-world economic markets have to shift in response to irrational consumer behavior: in reality there’s nothing inherent to the varieties that makes one “better” than the other. They’re just two different types of grapes, with marginally different flavor profiles. Repeated studies have shown that “wine experts,” when administered blind tests, are unable to distinguish between cheap and expensive bottles, or different varieties of the same color wine, or even whether the wine they’re drinking is red or white. In the end it’s all just fermented grape juice.
At any rate we’re 17 years out from the movie now, long enough for the pendulum of consumer preference to start swinging the opposite way: Merlot is back on the menu.