The proliferation of new product lines with distinct brand names has proven effective for helping wineries appeal to new groups of consumers, compete at a variety of price points, and move more cases without cannibalizing existing sales. In some cases, the winery makes no secret of the fact that their entire family of brands come from the same producer. But increasingly, wineries are finding it useful to separate their multiple personalities more thoroughly, in order to more convincingly do something different without influencing their established reputation. For the wine marketer, creating a new, distinct bottling trade name to go with a new brand name is the secret of success for creating an independent identity for a separate and unique brand of wines.

Often the new brand must appear to be from a new winery crafted in the image of the market segment to be conquered. Just ask E & J Gallo how important it was to the total marketing package for Turning Leaf that the production statement said "produced and bottled by Turning Leaf Vineyards" and not E & J Gallo Winery. In this case, the proverbial elephant--the largest winery in the world--quite effectively hid behind a sapling--a line of mandatory information only 3 mm tall. Kendall-Jackson was sufficiently alarmed by the effectiveness of Gallo's disguise to try to stop it in court.

But is it not only the mega-wineries creating new brands that benefit from the ease and flexibility of multiple trade names. Smaller wineries have often expanded by creating secondary labels to avoid diluting their flagship brand or to create a unique product. Bottling under proprietary trade names also allows the vibrant negociant tier of the wine industry to develop successful self-standing brands of their own, while helping the winery and grower tiers by making use of excess production capacity, grapes, and available bulk wine. The same strategy allows wineries the flexibility to outsource bottling when needed, while maintaining a consistent image in the consumers' eyes. It also helps a new winery hit the ground running with "their own" bottle-aged wine the day they open their doors. And it satisfies the needs of growers who want their own trade name in the "bottled by" statement of custom crushed wine.

Even retailers are getting involved. While specialty retailers like Trader Joe's have sold private label wine for years, we are now seeing the emergence of bottling trade names owned by large retail chains, so that their house brand wines (and beers) can be bottled under the same trade name no matter where they were produced.

Regulatory nuts and bolts of creating a new market segment for your winery

Before proceeding, let's take a moment to review the basic principles for working with trade names in the wine industry. Although the compliance department handles this for the marketers, a little insight into the procedures will help you understand the implications of some of our later discussions.

Adding a bottling trade name to your basic permit in order to bottle under that name involves a two-step process. First, the trade name is registered with the local or state registrar of trade names. In California, trade names are registered with the County Clerk by filing a "fictitious business name" statement and publishing the statement in a local paper. In most of the other states, a trade name is registered as an "assumed business name" with the Secretary of State's office.

In the second step, a copy of the filed trade name registration is sent to TTB's National Revenue Center, along with an application to amend your basic permit (TTB F 5100.18) or letterhead application under Industry Memorandum 93-12.

If the new trade name is owned by your winery and this is the first addition of that name to any permit in your state, you're home free. But if another permittee in your state has already added the name to its permit--which could easily happen if you're bottling for others--things can get more complicated.

In Napa County, where trade name swapping is common, the County Clerk will take multiple registrations of the same name without blinking an eye. But in some states and in some other counties in California, if a name has been registered to another entity, the County Clerk or Secretary of State's office will not let you register the name again. In that case, a simple letter from the previous registrant granting permission to register the trade name will allow you to proceed. Armed with this letter, you are free to file the state or local trade name registration listing your winery as the registrant "for the account of" the prior registrant.

A similar problem arises if another permittee in your state is already using the trade name on its permit. In that case, TTB may refuse to process your application, because "the name is unavailable." Again, a letter of permission from the previous user of the name will save the day. The operative sentence of the letter would read something like this: "We hereby grant (your winery's name) permission to register and add our trade name, ______, to their basic permit for bottling on our account."