Sparkling wine is trending at the moment and no brand best embodies the trend more than cult California sparkling wine producer Ultramarine. Michael Cruse, the founder of Ultramarine and Cruse Wine Co, explains how he developed a passion for sparkling wine that led to his accidental success. He covers how Ultramarine took off, techniques and production practices that have business implications he took from Champagne, pricing, and his view on sales channels. Detailed Show Notes: UltramarineStarted in 2008, 1st real vintage was 2010Sparkling wine in CA that focuses on coastal single vineyards, high acid, single vintagePrecise production style - not copying Champagne, but taking some techniques and applying them to CAHarvest ~1,000 cases/year, ~500-750 cases make the cut for releaseLimited ability to grow (due to lack of suitable fruit sources), target ~1,200-1,500 case rangeCruse Wine CoStarted in 2013, supposed to be a custom crush facilityInitially not for sparkling wine, an interest in ValdiguieLater realized his passion was in sparkling wine - does pet nats, more experimental, more oxidative stylesFocus on CA as a whole vs. coastal vineyards of Ultramarine~7,000 cases/year (2018 was peak ~8,500 cases)The capital intensity of producing sparklingCruse Tradition takes ~40 months to make which means 3 vintages must be paid for before selling any wine (e.g. - fruit, glass ($2+/bottle), etc…) - this limits growthUltramarine spends 38-48 months en tirage, found this to be its sweet spotSparkling wine equipmentBought own equipment vs. doing custom crush at Rack & Riddle - partially due to using a bottle that they would not takeFollows many Champagne producers - they may use co-op press, but do own elevage and disgorgementUses a gyropalette, which requires some bentonite (riddling aid)Long term relationship with growers is important -> growing sparkling is different than still wine grapesVarietal impact on winemakingChardonnay - less fruit, more minerality - be more reductive to preserve fruitPinot Noir - more fruit, less minerality - be more oxidative to get more mineralityPricingValue spaces (~$20-25/bottle), e.g. - Gloria Ferrer, Roederer Estate, Cruse doesn’t have the scale or capital to compete hereDoesn’t think he can sell 10,000 cases @ $70/bottleBelieves he can sell 5-10,000 cases @ $45-55/bottleUnclear how Champagne price inflation will impact market opportunity for domestic sparklingUltramarine secondary pricing - goes for 3x release price; believes it’s only ~30 bottles/year @ $200/bottle, could not sell entire production at that price pointSales channelsCruse - ⅓ DTC, ⅓ domestic wholesale, ⅓ export (Asia - Japan, Singapore strong)Ultramarine - 90-95% DTC - believes sweet spot is ~80% DTC to get more into restaurantsUltramarine mailing listBig supporters early on propelled the brand (e.g. - the NYC crew of Patrick Cappiello, Levi Dalton, and Pascaline Lepeltier)Instagram helped to fuel growthTook 3 releases (2012 release) to get a waiting listWine Berserkers also helpedCruse launch planNo real plan initially focused on friends & familyHardy Wallace helped get wines in front of distributorsRelationships with certain wine critics helpThe website is unintentionally sparse but does longer allocation emails Get access to library episodes Our GDPR privacy policy was updated on August 8, 2022. Visit acast.com/privacy for more information.