New York City January 23, 2007

1. The U.S. Wine Market – Consumer Trends and Analysis New York City January 23, 2007 Kennewick, WA – February 6, 2008

2. Wine Market Council Key Facts: All Tiers of the Industry Involved Promotion of Imported and Domestic Wines Focus on Expanding U.S. Consumer Market for Wine

3. Wine Market Council Mission Statement: “…to establish the widespread acceptance of wine as a rewarding part of American culture and to encourage the responsible enjoyment of wine by current and future generations of adults in the United States.”

4. Ongoing Consumer Research Quantitative studies Focus groups and Internet studies National Public Relations Campaign Target marginal wine consumers Mainstream consumer media Raise comfort level with wine Wine Market Council Initiatives

5. New York City January 23, 2007 2007: “Tipping Point Year”

6. Consumption Frequency Segmentation, 2007 55% 45% Source: Merrill Research

7. Total Wine Consumption – U.S. (Millions of cases) 304* 290 279 270 259 245 231 229 225 212 *Estimate Source: Impact Databank

8. U.S. Adult Per Capita Table Wine Consumption v. Population Growth 216* 211 194 184 173 164 154 147 Adult Population 134 3.02* 2.81 2.58 2.46 2.29 2.13 1.96 1.78 Gallons per Adult 1.05 1970 1975 1980 1985 1990 1995 2000 2005 2007 Source: U.S. Census Bureau, Adams Beverage Group *Estimate

9. Male v. Female Ratio of Wine Drinkers, 2007 (Percent by segment and generation) 53 50 50 50 50 47 Gen X Millennial Boomer Source: Merrill Research

10. Net Gain in Wine Consumption, 2007 (Net gain “Drinking more wine” vs. year or two ago, by gender) 25% 22% Source: Merrill Research

11. Consumer Segments by Gender, 2007 Male 54% Male 41% Female 46% Female 59% Core Marginal Source: Merrill Research

12. Segments by Age, 2007 (Mean) 46.9 45.6 Source: Merrill Research

13. Younger Generations Drive New Growth, 2007 (Net percent “drinking more wine” by generation) 47 37 10 Source: Merrill Research

14. Beverage Alcohol Consumers, 2000 (Ages 21 – Plus) Don’t drink wine 57% 64 M 49 M Drink wine 43% Source: Merrill Research

15. Beverage Alcohol Consumers, 2007 (Ages 21 – Plus) Don’t drink wine 43% 56 M 75 M Drink wine 57% Source: Merrill Research

16. New York City January 23, 2007 Consumer Segmentation

17. Consumer Segments U.S. Adults, 2007 (Ages 21 – Plus) Core 17.8% Non-Drinkers 39.2% Marginal 17.2% Beer/Spirits 25.8% Source: Merrill Research

18. Wine Drinker Consumption of Beer and Spirits, 2007 (Percent by segment) 100 100 86 82 80 70 Core Marginal Source: Merrill Research

19. Net Gain/Loss in Beverage Alcohol Consumption, 2007 (Percentage gain or loss by beverage type) 23% Wine Beer Spirits -7% -15% Source: Merrill Research

20. Drinking Less Beer or Spirits but More Wine: “Trade – Off” Drinkers, 2007 10% 90% Source: Merrill Research

21. “Trade-Off” Consumers Skew Younger, 2007 (Percentages by generation) 39 34 27 24 24 19 18 15 Millennial Gen X Boomer Aged 62+ Source: Merrill Research

22. Reasons for Increased Wine Consumption, 2007 (Percentage by statement) 57 37 34 28 26 17 More per occasion Both More occasions Source: Merrill Research

23. “I would drink more wine if…” 2007 (Percentage by statement – drinking same or less than year or two ago) 33 32 27 26 21 17 13 7 No small children More affordable Spouse drank wine Less $ in restaurant Source: Merrill Research

24. Purchase and Usage Behaviors New York City January 23, 2007

25. Frequency of Purchase by Price Point, 2007 (Frequent or occasional purchase) 81 74 65 64 63 45 38 37 29 25 17 9 <$3 $3 - $6 $6 - $10 $10 - $15 $15 - $20 >$20 Source: Merrill Research

26. Color Mix by Segment, 2007 Core Marginal Source: Merrill Research

27. Appellation Mix Consumed by Segment, 2007 Marginal Core Source: Merrill Research

28. Imported Wine Purchases by Country, 2007 (Percent have purchased wine by country in past 3 months) 52 44 41 32 26 26 26 23 23 22 18 18 16 14 12 9 6 6 Source: Merrill Research

29. Wine Purchases by State, 2007 (Percent have purchased wine by state in past 3 months) 90 79 28 24 23 18 13 12 Source: Merrill Research

30. Winery and Internet Direct Markets New York City January 23, 2007

31. Membership in Wine Clubs – 2007 (Percent by membership and segment) 93 76 13 6 5 5 2 0 3+ Clubs 1 Club 2 Clubs None Source: Merrill Research

32. 2007 - Ever Purchased Wine Directly from a Winery? (Percent by channel and segment) 59 44 15 15 7 6 Source: Merrill Research

33. 2007 - Ever Purchased Wine Over the Internet? (Percent by segment) 18 9 Source: Merrill Research

34. Internet Wine Purchases by Channel, 2007 (Percent purchase by channel) 64 35 8 3 Source: Merrill Research

35. Increase in Winery Online Sales, 2003 - 2007 (Percent “ever purchased from winery site”) 17 11 6 6 5 1 Marginal Core Source: Merrill Research

36. New York City January 23, 2007 Millennial Generation

37. American Generations (Age ranges in 2008) WW II (76 and over) 32 Million Swing (63 - 75) 30 Million Boomer (44 - 62) 77 Million Generation X (32 - 44) 44 Million Millennial (14 - 31) 70 Million Source: American Generations

38. Segments by Generation, 2007 (Percentage by segment and generation) 43 35 26 22 21 18 18 17 62-plus Gen X Boomer Millennial Source: Merrill Research

39. Wine Consumed Most Often – Imports vs. Domestic - by Generation, 2007 Gen X Boomer Millennial Source: Merrill Research

40. Imported Wine Purchases by Country, 2007 (Percent have purchased wine by country in past 3 months) 57 50 43 36 36 33 27 24 23 22 22 18 18 17 15 13 13 10 Source: Merrill Research

41. Have Purchased Wine Online, 2007 23% 16% 11% Source: Merrill Research

42. Importance of Information from the Internet when purchasing Wine, 2007 (Top 3 box) 49% 36% 21% Source: Merrill Research

43. The U.S. Wine Market – Consumer Trends and Analysis New York City January 23, 2007 Kennewick, WA – February 6, 2008