How Napa wineries are gearing up to survive

It's one of the world's glamorous wine regions, a honeypot for high-end wine lovers. But how will Napa's tasting rooms (and waiting lists) fare in a post-COVID world?

Words by Elin McCoy

Montelena vineyard
Napa Valley's Chateau Montelena

As if the Napa Valley didn’t have enough to contend with as it prepares for a tough harvest in this pandemic year, wildfires are currently rearing their head in the region. Earlier this week, heatwaves saw wineries rushing to pick their white grapes in 100˚C temperatures, as lightning storms circled. Now, at the time of writing, flames are fanning out over Howell Mountain, Chiles Valley and elsewhere, billowing smoke and threatening winery buildings and homes. Up in the mountains, Atlas Peak and Pritchard Hill, home to Mondavi family-owned winery Continuum, are among the areas to have been evacuated as a precaution – though for now, the fires seem to be moving eastwards, away from wine country and the valley floor.

It’s a scene with which Napa winemakers are all too familiar – and the latest in a string of challenges besetting a wine region long seen as one of the most glamorous in the world. The valley is home to 500 wineries and more than 1,000 brands. When Covid-19 upended the market, it sent even the region’s most upscale wineries scrambling to sell high-priced Cabernets. As the future unfolds, there will be a shakeout. So what will dictate the winners and losers?

“The wineries that were thriving before the pandemic will pull through; the ones who weren’t won’t,” says Kashy Khaledi, the owner of hip winery Ashes and Diamonds, which opened in 2017. “Harlan Estate and Colgin Cellars are not going away.” But the story is more complicated than that. The future of many of Napa’s most collectible wines will also depend on what those vintners do over the next year.

The future of many of Napa’s most collectible wines will also depend on what those vintners do over the next year

The number of $150+ Cabernets in Napa might surprise you. reviewed some 300 examples from the 2016 vintage alone, many from wineries only a few years old. And that’s only a sampling of what’s out there. As Dan Petroski, winemaker of Larkmead and his own Massican brand, puts it, “The last ten years have been sex, drugs, and rock ‘n’ roll for expensive Cabernet.”

The decade saw the stock market booming and four million thirsty visitors rolling into Napa every year. Many wineries depended on these tourists to snap up wines in their tasting rooms and join their mailing lists and wine clubs. But in March, all that disappeared. Tasting rooms were forced to close. Occupancy rates at Napa’s luxury hotels fell to a trickle. Flashy restaurants, the wineries’ other big source of sales, closed and stopped buying wine.

Suddenly, wineries had to reshape their tasting experiences and adapt to a new wine-selling marketplace. Those who very quickly got personal with wine lovers look set to be among the long-term winners.

Heitz's club membership has doubled under the watchful eye of managing director Carlton McCoy

At Heitz Cellar, managing director Carlton McCoy explains, “We’re using every angle to engage with our customers – phone calls with conversations deeper than wine, email offers of older vintages of our top Cabernets – and our club membership has doubled.”

Meanwhile Khaledi, who has a background as an executive in the music business, started telemarketing to his 30,000-strong mailing list with “compassion first, transaction later”. His revenue is up. Petroski gave people his mobile phone number, shared stories with wine lovers, and set up virtual cocktail hours to boost camaraderie. People bought.

The wineries which have been the most diligent in collecting data from visitors will survive best – “and will continue to do so,” according to Rob McMillan, senior vice president of Silicon Valley Bank’s wine division.

Chateau Montelena has begun offering a range of bespoke tasting experiences

Small wineries founded only a few years ago haven’t had time to do that. There are question marks as to whether exclusive luxury brand Cabernets like Tusk Estates, which started as a private club, will survive the shift in consumer behaviour.

Embracing social media and virtual tastings are trends that will continue, say renowned winemaker Steve Matthiasson and his wife Jill. To their surprise, companies which have been unable to treat top employees to special dinners and trips to Napa are arranging group virtual tastings instead – and the boxes of wines sent in advance partly make up for lost restaurant sales.

Tasting experiences will also be radically different. A restricted number of guests and a reservation-only rule ensures interactions are longer and more personal. Right now, they have to be held outside, so those wineries with large outdoor spaces have a serious advantage.

One trend is private wine cabanas, open-sided structures that allow couples or small groups to stay socially distanced while imbibing. Quintessa already had small wine pavilions in the vineyard in place, but Domaine Chandon, Louis Martini and Charles Krug recently launched their own cabanas that wouldn’t look out of place at a beach; Krug’s come with wifi, of course.

Bespoke tasting experiences in partnership with local restaurants and hotels will be another luxury innovation. Chateau Montelena, for example, just began offering romantic dinners and wines with the plush Calistoga Ranch that range from $2,500 to $10,000 a couple.

"We don't need any more lifestyle brands," argues Michael Honig
While many estates are launching new cabanas, Quintessa already had small wine pavilions in place

The pandemic also accelerated a lot of existing trends. Buying wine online has skyrocketed. Mike Osborn, the founder of, says that between March 15 and June 15, sales increased 250% from the same period last year. Harlan Estate, once available only via a mailing list with a long waiting list, can be purchased on (the 2016 is $1,449). Retail sales in wine shops also boomed to double and even triple during lockdown.

Less well-known Cabernets from tiny wineries with no retail distribution are struggling to catch up. This isn’t easy because of the U.S.’s three-tier distribution system, where wineries sell to distributors who sell to retailers. The kind of small distributors who might take on such small-scale names are struggling, too, another trend exacerbated by the pandemic.

The painful reality is that the world has changed, and fewer people care about exclusive, expensive Cabernets – another trend that Covid-19 has brought to the fore as drinkers reassess so much about how they live their lives. As Michael Honig, whose eponymous winery has been around for 40 years, pointed out, “We don’t need any more lifestyle brands. We have to look beyond 65 year old collectors. Ageing boomers already have full cellars.”

Carlton McCoy, who became Heitz CEO at the end of 2018, says that Napa has long lacked the mid-priced “village” wines that can excite and draw in a new generation. The winery set about trying to create a line of them pre-Covid-19, and will shortly be launching $24 to $40 wines under the label Leon Brendel. The timing is fortuitous.

The world has changed, and fewer people care about exclusive, expensive Cabernets

All this, as well as COVID-19, is why wineries are cutting back on how much of their top Cabernet they’ll produce in 2020, and in the near future. Honig, like many other winemakers, says he plans to make less of his two single vineyard bottlings and put excess grapes into the regular – and cheaper – Napa Valley label. According to two reliable sources, one well-known Stags Leap District winery doesn’t plan to harvest at all this year, to save money.

“When the economy is flush, people will splash out money on expensive wines, even those they don’t know,” he says, “and in times like these, they look for heritage brands they’ve bought before for comfort.” That means Cabernets with a history and a devotion to farming, such as Diamond Creek, Chappellet, Corison, Larkmead, Heitz Cellar, Dominus and Stony Hill.

Heitz’s McCoy as well as many other winemakers, are convinced that drinkers now are looking for “real wines with soul.”  The biggest Cabernet losers, he predicts, will be “the pop-up, engineered brands pushed into hyperdrive by marketing and high scores.” And who knows – all of this may shift the valley’s elitist, money-driven image to one more about terroir and human connection.