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Roy Cecchetti has been creating and building brands for three decades, and now he guiding a new branded-wine effort by one of California’s largest producers.

After selling his Cecchetti Wine Co. brands — Line 39, RedTree, Austerity, Backhouse and Exitus — to Larkspur-based O’Neill Vintners & Distillers in February 2014, Cecchetti became the leader of O’Neill’s national brands initiative. Though it is among the top 10 producers of wine, O’Neill had been mostly a producer of bulk wine and spirits for sale to other vintners or creator of brands exclusively for certain clients.

Case sales last year are estimated to be 760,000, according to Wine Business Monthly, but national brands now make up 500,000 of that.

Cecchetti got into wine brand-building in 1985 with Cecchetti Sebastiani Cellar, known for launching the Pepperwood Grove and Smoking Loon brands. He sold his interest to his nephews in 2001. After a short stint at the helm of what’s now Vintage Wine Estates’ Langtry Estate winery in Lake County, Cecchetti started his own wine company.

He is set to be part of a panel on wine mergers and acquisitions at the Business Journal’s Wine Industry Conference on April 28. He spoke with the Journal about the importance of production and sales infrastructure for building an efficient, scalable brand and how O’Neill Vintners helped make that happen.

How did the Cecchetti Sebastiani and Cecchetti Wine Co. brands grow over time?

ROY CECCHETTI: Cecchetti Sebastiani Cellar’s flagship brand was Pepperwood Grove. That brand in a five-year period — late 1990s to the early 2000s — went from literally zero to about 400,000 cases. That was led by pinot noir and several different varietals.

It kind of hit a nerve. At the time, the industry there wasn’t many, if at all, pinot noirs at the $6 price range at the time. If there were, they probably didn’t taste like pinot noirs. We kind of broke the mold a little bit.

That took off and led the brand to the point where we started introducing other varietals. That was a pretty wild ride.

It gave us the opportunity to build our own bottling facility, which we didn’t have. Because of our shear growth, our winemaker was having difficulty getting space for bottling at other facility. That forced our hand to build our own facility, which we did in the late 1990s. That became the Don [Sebastiani] & Sons facility at [Napa Valley Commons].

We really didn’t have any other brands because we didn’t have a lot of horsepower with a sales team. We introduced the Cecchetti Sebastiani Napa Valley brand later on. That brand was very high end — $40–$50 bottles of [cabernet sauvignon] and merlot and cabernet franc. We couldn’t keep up with demand on that. We only did a few thousand cases at the rollout.

Before we built the facility, we introduced the brand Smoking Duck and started shipping it. It was wildly accepted by the trade. Unfortunately, there were trademark infringements with Duckhorn [Wine Co.]. Fortunately, it was early enough in the game for us to change it, so we dropped it.

After the facility was built, that brand morphed into Smoking Loon. Once I sold my interest, my nephews at Don & Sons took it from there.

How did you build Cecchetti Wine Co. and those brands?

CECCHETTI: After I sold my interest on Cecchetti Sebastiani, I retired for a few years. Then I got bored and got back into the business. I ran the Guenoc facility [now Langtry Estate] in Lake County for less than two years. I ultimately decided, Why am I doing this for someone else, when I can … make my own brands?

The wine company began in 2007 with two brands, Line 39 and RedTree. RedTree was a brand that got a lot of traction from the get-go but then kind of plateaued out just because of the pricing phenomenon we found ourselves in, with consumers trading up. Line 39 being in that higher price point went to another level.

This year Line 39 [sales] will be somewhere pushing 300,000 cases. That brand still has a tremendous ways to go. I truly see [sales of] that brand being at 1 million cases in the next three or four years with the [untapped] territory we have around the country. … It turns; it sells. Distributors love it. Retailers love it. …

Over the years we created another brand, Austerity, in the $15–$17 range, Central Coast appellation: Paso Robles cabernet sauvignon, Arroyo Seco chardonnay and Santa Lucia Highlands pinot noir. That brand has gained a lot of traction, in part, because it’s in that hot price point. It’s a small brand right now, with maybe 15,000–20,000 cases this year.

We created Backhouse initially as an on-premise-only brand. It morphed into a national brand. People were drinking it in restaurants and wanted to buy it. That brand has a long way to go but it is in that lower price point that’s kind of a struggle these days.

Line 39 this year is up 40 [percentage] points. With Jeff [O’Neill] purchasing the Cecchetti Wine Co. brands, his production capabilities and the sales team we’ve put together. We grew Cecchetti with three people to 170,000 cases before we did the deal with Jeff. Now we’ve put together a sales team of a dozen people around the country. That’s what you’re seeing with the dramatic growth of the brands.

How has O’Neill Vintners grown over the years?

CECCHETTI: They are new to the branded business. The biggest portion of the business is branded wine sales. They are the seventh- or eight-largest winery by volume in California. The distillery does Paul Masson and Christian Brothers brandy.

They got into the branded business when Jeff cut a deal with Jackson Wine Estates to get the Camelot and Pepi brands. They struggled with those brands. They were kind of on the downward slide, but we resurrected them. Camelot is holding its own right now in that under $8 category.

Then Jeff purchased the Martin & Weyrich Allegro moscato brand.

Also a big portion of their business before Cecchetti was control labels for major retail accounts such as Total Wine & More. Those brands are owned by O’Neill but exclusively sold by those retailers. There are probably a dozen or so of those brands.

With the Cecchetti brands, the emphasis has become national brands. This year, [sales] will be close to half a million cases for national brands combined.

Jeff wanted me to stick around because of my experience building brands over the years. We’re going to be adding people as we grow — more street [sales] people, more market managers — so we get this organization to the point we’re ready to hit the million-case mark.

What pressure is there to upscale the O’Neill portfolio? With Cecchetti, you had Line 39 to respond to the trend.

CECCHETTI: You make a better buck by putting your juice into a case of wine than selling as bulk wine. That is a big positive for the company. Now our team is making our wine for our wines. We get the cream of the crop from our production. We see it in the reviews and the accolades we’re getting.

We’re creating new brands to get into price points where we’re not. We created Harken. You can’t find a barrel-fermented California chardonnay at $14 a bottle. Because of our capabilities and efficiencies, we’re able to do it. It fits very well between Line 39 and Austerity.

We’re introducing later this year a Sonoma County brand called Exitus, which was an old Cecchetti brand we started and put to the wayside because our hands were full. It is going to have an Alexander Valley cabernet and a Sonoma Coast chardonnay. It’s in the low-$20 price point, where we haven’t played yet.

We’re trying to leverage our portfolio on the higher price points, because that’s where a lot of the business is. We’re trying to fill voids so we can present a meaningful portfolio distributors. We’re going to continue to do that either organically by creating our own brands or by acquisition. We’re trying to grow volume-wise but also in price points that are important.

How did you decide on O’Neill Vintners?

CECCHETTI: Cecchetti Wine Co. was pushing more than 300,000 cases in 2014. I had reached a crossroads, kind of like at Cecchetti Sebastiani. We were having more and more difficulty finding the space we need to do our production and bottling. We had two facilities we were using and looking at a third facility to use. Once we started getting outside of one faiclity, we started losing efficiency and things started getting more expensive.

I then had to make a decision, either invest in a facility of our own or look for a partner, need to do a deal. Because we couldn’t continue doing what we were doing. I looked at my wife and said, “At this point in our lives, do we really want to double-down and get into this thing deeper when we have no real succession plan?” I have one daughter who has no interest whatsoever in the wine business.

It just didn’t make sense for us to do that, so I started looking for a partner. I had known Jeff for many, many years. I had done a lot of bulk-wine business with him. It turned out to be the perfect match: Jeff looking for national brands; myself looking for the production capability.

It has worked out perfectly since we did the deal in February 2014. Line 39 has almost doubled in size because of the efficiencies and sales team. It became an exit strategy.

What did you do to prepare for the sale?

CECCHETTI: We didn’t need to pretty up. It was going in the right direction. The brands sold themselves. Line 39 had incredible Nielsen data and kept growing.

But I knew at some point the growth would start flattening out if we didn’t do something. We were having a lot of out-of-stocks because we couldn’t get the wine in the bottle fast enough. If you have too many of those, if you can’t service the chains, you’re out as fast as you went in. It was a big concern to me to get this thing fixed.

How would you recommend others get ready?

CECCHETTI: I’ve always said all the value in the winery is with the brands. Everybody has got tanks, barrels and vineyards. I think you’re seeing that come true again.

We went through a period of time in the late 1990s and early 2000s that brands were being sold like crazy, like Ravenswood and Sebastiani. Then we went through a period where people were looking for dirt, for vineyards, for facilities.

I think we’ve swung all the way around, as you’ve seen with Constellation in what they’re doing, to looking for brands. There is enough capacity in this industry from processing standpoint. That’s why I was leery about building a facility. If I had the facility and wanted to get out, it probably wouldn’t be [sold] with the facility.

With Pepperwood Grove before I sold my interest to my nephews, we put the brand up for sale and had tremendous interest from all the big players. But no one was interested in the facility. Then you wonder what you’re going to do with [the winery].

[Vintners today] should pay attention to [the] brand. I always try to do everything possible to get the right reviews. If I didn’t think a wine was good enough, I wouldn’t send it in.

The argument for buying vineyards, especially in the North Coast area, is to lock in supply.

CECCHETTI: If you are a high-end brand, you want to have the vineyards go along with it. But you certainly didn’t see that with Constellation with its last purchase [of The Prisoner from Huneuus Vintners]. It was purely a brand play. Someone of that size has plenty of production around the state to feed into that brand.

If you’re not a Constellation, you have to be very careful, because the prices of grapes and bulk wine on the North Coast make it difficult to make it work.

Even on the small scale, you’re not going to get the attention unless your brand is doing something.