“Success in life depends on who your parents were and what circumstances you grew up in" - Ernest and Julio Gallo.
Few people have had more of an impact on the US wine market than the Gallo brothers, Ernest and Julio. It is said that they were the first to introduce mainstream advertising and merchandising to the industry and the family company has done much to develop the taste buds of American consumers over the decades. Whereas Europe was once seen as the bastion of winemaking, the Gallos certainly put Napa Valley and America firmly in the picture.
The Gallo brothers were born into the grape industry, as the sons of Italian immigrants in the beautiful foothills of the Sierra Nevada. Their parents already had a grape growing business, which passed over to the sons when the parents were involved in a gruesome murder/suicide during Prohibition. Ernest Gallo was the driving force behind the business, a workaholic who frequently put in 16 hour days and undertook lengthy cross-country trips to promote the business. He was known as a stickler, with "a constant striving for perfection in every aspect of our business." Brother Julio ("you make the wine and I'll sell it") handled production.
Ernest and Julio's goal was to educate American habits and get them to drink non vintage and inexpensive wines, or according to Ernest, to produce the "Campbell Soup company of the wine industry." Very quickly they cornered a significant portion of the American market with brands such as Thunderbird and Boone’s Farm wines. Even though by any standards these were downmarket brands, made with up to 20% alcohol content, they appealed to the mass-market. As the company grew to dominate the wine world, Gallo struggled with this image and it took a concerted, but ultimately effective marketing plan to transition away from this downmarket tag.
The Gallo brothers, and more specifically Ernest, were very shrewd and politically aware. Wine and liquor are both heavily regulated and the brothers understood that their fortune and future often lay in the hands of politicians. They were quite adept at making significant campaign contributions across either side of the political aisle, according to how it would best suit them.
By the 80s, the company had branched out and was now producing premium quality Chardonnays as well as medium market products and wine coolers; annual revenues had grown to exceed $1 billion. It was during this period that a younger brother Joseph, who had initially worked in the wine business during childhood, decided that he wanted his piece of the family fame and fortune as well. He established a cheese making business using the family’s last name, but was sued by the older brothers accordingly. When Joseph counter-sued, claiming that he should receive part of the wine fortune, this resulted in a bitter court battle that Joe ultimately lost, ensuring that he was estranged from the family thereafter.
Presently, the E. & J. Gallo business is the largest family owned winery in the country and is still directed and managed by second and third generations. A very broad range of brands and labels is now produced as part of a process that is very eco-friendly, sustainable and socially acceptable. The Gallo winery was the recipient of the prestigious ISO 14001 certification in recognition of these efforts.
Julio was to die in 1993 in an unfortunate car crash, while the reticent Ernest lived to the ripe old age of 97, leaving behind a wealth of over $1.2 billion and a considerable legacy.
Adam Toren
