Interview, Part 2: Treasury Wine Estates COO Robert Foye And CMO Michelle TerrySeptember 12, 2018
In the second part of our interview, Treasury Wine Estates COO Robert Foye and CMO Michelle Terry discuss the recent overhaul of the company’s route-to-market as well as its plans to raise the profile of its iconic Penfolds brand in the U.S.
SND: Earlier this year, TWE made some major changes to its U.S. route-to-market, including a move to partial direct distribution in California and Washington and a hybrid model in Florida. How have the results been so far?
Foye: It was a pretty massive change, covering about 42% of our volume in the U.S. It became effective April 1, and over the first few months we did a lot of the heavy lifting and made a lot of progress. But to really embed all the way down, it will be a nine- or 12-month process. We’re seeing very positive signs, and we know we’re on the right track. Six to nine months from now, we’ll be in a really good place. We undertook a similar initiative in Asia, and it took about nine months to really start seeing the benefits.
SND: Penfolds recently announced that it will be adding Napa-sourced wines to its portfolio. How will that project take shape?
Terry: We’re seeking to extend our range to California beginning with the 2018 vintage. The idea is to take the Penfolds house style and blending philosophy and work with the best of the best of Napa Valley grapes. The intention is to create wines on par with our icon wines like Grange, Bin 407, 707, and 389, so pricing will be at the luxury level. Penfolds winemakers will be here on the ground, and our chief winemaker Peter Gago is very engaged as well. Penfolds does have a history with California—we brought cuttings from the Kalimna vineyard in Barossa Valley to the Camatta Hills vineyards in California in the 1990s—and the winery is known for being inventive with its grape sourcing, with Grange being a key example. So we think this fits nicely with the Penfolds story and will add to its legacy. We’re also holding the Penfolds global collection launch in New York this year. It’s the first time we’re doing that in the United States, which reflects the commitment we’re making to grow the Penfolds brand here.
SND: TWE Americas has made significant progress lately after a number of difficult years. What does the future look like for the company?
Foye: If you look at it on a scale of one to 10, I think we’re about halfway there. We’ve done a lot of hard work. Michelle came in about a year ago, so she’s been here six months longer than I have. She brought a lot of energy to the marketing area. We brought similar energy to the sales area. Our winemaking has always been fabulous, so it was really about taking our vineyards and brands and dusting them off, polishing them, and starting to grow them. Within the company, we’re creating a culture of innovation, of speed to market, and an environment more like that of a start-up. The launch of EmBrazen is a good example. The packaging, the wine, the marketing concept, and the digital components were all centered around millennial consumers, and the brand was created very quickly—with the right market insights and authenticity—by a cross-functional team working all the way from winemaking through to consumer marketing and sales. That’s a template for the way we want to work moving forward.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.