Charity Wine Auctions

Many of us have heard about and read articles on the success of High Dollar Charity Wine Auctions.  Napa Valley, Naples, and Destin Florida all have Charity Wine Auctions that gross Millions of Dollars each and every year. Smaller Wine Events like the Rare & Fine Wine Auction by the Wine and Food Foundation of Texas in Austin or A Vintage Affair in Tennessee raise $300K-$400K annually. 

Though few charity wine auctions have set record highs since 2007, 2012 proved to be a promising year, with auction organizers quick to cite the steady growth and relative consistency of the market as reasons for encouragement. The combined total of the 10 highest-earning events by way of live auction bidding was up 12 percent over last year, and up 60 percent over what was raised in 2009, Wine Spectator‘s Lizzie Munro reports. Not all the Auctions for 2013 are concluded yet, but for the record the top 10 in 2012 were: (According to Wine Spectator)*

10. Destin Charity Wine Auction with $894,000 (Though it must be noted they did 1.1 Million in 2013 a 22% increase)

9. Harmony Gala in St Helena California- $928,000

8. Lyric Opera of Chicago- $962,000

7. V Foundation Wine Celebration-$1.1 Million

6. High Museum Atlanta Wine Auction- 1.25 Million

5. Rusty Staub Foundation Emergency Food Foundation- 1.28 Million

4. Houston Livestock Show & Rodeo-1.4 Million

3. Southwest Florida Wine and Food Festival- 1.5 Million

2. Auction Napa Valley- 5 Million

1. Naples Winter Wine Festival- 11 Million

*Self Reported Live Auction Totals

It’s easy to take one of two attitudes to these events. Either a “We can’t ever do that” attitude (Because it’s too expensive or we don’t have the Expertise) or a “Let’s get on that Train” outlook which can be very dangerous unless you know what you are getting into.  So what are the pitfalls and the promises of a Charity Wine Auction? Can you get a share of the more than 50 Million dollars that are being raised for Charities across the United States conducting Wine Auctions?

So what is the difference between an 11 Million Dollar Wine Auction and a $ 364,000 Wine Auction?

I asked several experts on Wine Auctions to share their thoughts with me on this lucrative but sometimes expensive type of Charity Auction. Lauren Magli, Director of Events at Destin Charity Wine Auction Foundation, Marshall Jones, the Executive Director, The Wine and Food Foundation of Texas, and Harvey Kronberg, a Texas Public Policy Analyst and Auctioneer for two of the Largest Wine Auctions in Austin Texas all had opinions. Some things they agree on and some things they differ.

We began with the date of the event. All three thought that the spring or the fall was not an important issue but Marshall indicated that the calendar date was important. “Our Auction is rarely, if ever, not competing with another charity event the same night.  Austin is not big enough, however; to ignore the Big 3: Texas Football, SXSW and ACL festival.  To my knowledge no one has ever succeeded competing against these events.”Lauren agreed that “The Date is more important than the Venue,” and both believe consistency is the key. The Destin Wine Auction is always the 4^th weekend in April and they have changed the site of the event in order to keep the date. So once you pick your date stay with it and stay aware of the other big events in your City. Unless you can Partner with the New Orleans Jazz and Heritage Festival or the Crewe of Bacchus if you are in the Crescent City for example, better pick another weekend.  

 When we discussed the makeup of the committee there were differing opinions. The Destin event is primarily staff driven with one important addition. The event makes use of high quality well known Vintners like Jeff Smith of Hourglass Winery, Greg Lill of DeLille Cellars and many more. Lauren was adamant that the Vintners, above all else; including the date, venue and auctioneer was the key to success.

Marshalls event is more volunteer driven and his committee is made up of Investment professionals (40%), real estate professionals (10%), lobbyists (10%), wine professionals (10%), attorneys (5%) and others (15%) all that have an almost obsessive attraction and interest in fine wine.

So look to the experts and wine aficionados. Find people in your community first and foremost with a passion for Wine, Food and Spirits. We will look at the Charity Selection later but everyone I spoke with agreed that a zealous love of Wine is the key to good committee members.  

When asked had it been their experience that the Wine itself sells for higher than retail value at the Auction again there was agreement. Yes. This is where Charity Wine Auctions differ from the standard Black Tie Gala. In a Black Tie Gala lots normally go for less than retail value. This is because people still want a bargain but also want to feel good about their purchase.   The Texas Rare & Fine Wine Auction has averaged approximately 150% above retail over the past three years. The Destin event had much the same experience with their Auctioneer Dave Reynolds bringing in higher than retail bids on lot after lot. This may be because of the Charities benefitting from the event but it may also be the nature of Wine and Spirits as consumable commodities in general that have a mystique to them and are hard to value. What value do you put on an experience of opening a Bottle of Bond Pluribus Napa Valley 2007 and sharing it with your friends & family?  So with the right crowd who have a passion and knowledge for your offerings who knows how high you can go? This underscores the involvement of Vintners and Wine Professionals in your event.

When it comes to selecting your Auctioneer, everyone I spoke to agreed that a Professional was critical to the Auctions success.  Lauren Magli swears by Dave Reynolds of Reynolds & Buckley as does Dick Grace of Grace Family Vineyards.  But there are literally hundreds of Auctioneers from which to choose.

When searching for an Auctioneer, look for someone with experience in this type of arena and a Charity Benefit Specialist. An Automobile Auctioneer or a Cattle Auctioneer might work for his dinner and not charge a fee, but he can be so fast that people tune out. As a very smart Auctioneer once told me, “A Confused mind does not bid”. Avoid amateurs at all costs as your Event is much too important. It’s also helpful to ask for references and check with your State Auctioneers Association and/or Licensing Body. (The Texas Auctioneers Association or the Texas Department of Licensing and Regulation for example.)  An added advantage is an Auctioneer that brings his or her own team of Ringmen or Bid Spotters to the event.

 A mistake that one Auction in the Southeast made was to have three Volunteer Auctioneers to “Switch Out” as the night went on. This made the Auction go longer and longer and has Harvey Kronberg says, “Your greatest enemy is the babysitter”.  An Auction that lasts too long destroys the momentum and makes it hard to get guests to return. 

This brings up the point of how many lots to offer in your Fundraising Wine Auction. Some say 50. I have seen as high as 122. My own personal experience is the smaller number (say 45-55) in the Live Auction and about a 3 to 1 ratio in the Silent. (1 Silent Lot for every 3 guests) or so at the maximum is for the best.  This can be difficult to achieve when egos are involved from Donors who may view the Silent Auction at “2^nd Tier,” but it’s a battle that must be fought at some point. 

 So, even though it is a Wine Auction, should you offer lots other than Wine? Wine Trips, Spirits, Accessories, Wine Dinners? How do they sell?

At the Destin Florida event they offered a dinner aboardThe World. It’s the only private residential community-at-sea where its Residents may travel the globe without ever leaving home. Since it first set sail in 2002, The World has visited over 800 ports in approximately 140 countries. This was not a night aboard, but rather Dinner and the chance to see the ship. It sold for $40,000+.

In Austin Texas, Marshall Jones says “Wine dinners do extremely well and Wine trips sell very well but only if they are well thought out and planned.  They must have a ‘reason’ for the trip and cannot just be an amalgamation of experiences (wine visits, dinners) and stays that were just donated and packaged together.  Spirits do well if there are not too many of them.  We sold a premium Scotch lot to a Scot for 200% value a few years ago!  Local spirits do well in a silent auction.”

The take- away here is that Non Wine offerings are a good idea, but only if properly researched and right for the crowd. Perhaps the 6 foot tall bronze statue of a naked Wine God Bacchus should be tactfully refused. 

The next issue can be a tremendous point of conversation, and can not only affect your event, but can also affect your organization as a whole.  That issue is…The Charity you choose to partner with.  How important is the associated Charity and what should a Non-Profit beneficiary bring to the table to ensure success?  Harvey had a simple rule. The Associated Charity should be one with enough brand awareness so that no long drawn out explanation of what they do for the community is necessary. This does not mean a National Charity as Lauren was quick to point out. “We always choose local charities with local branches” she said. “The money does not go off to a National organization in another city” One good example (certainly not the only one) would be the Boy Scouts or Girl Scouts of America. They have a national presence and great brand awareness, but are administered by Local Councils with local boards of directors and Troops in your community.

  The right Charity can help you garner sponsorships and donations,   be great resources for manpower and marketing for your event.  And, of course; bring in attendees above and beyond the wine and food enthusiasts.

If you are your own non-profit considering an Auction of this type, consider partnering with another Charity who possesses these qualities.

The last thing I asked the group was if they could name one thing (They had to pick one) that is the key to the success of the Auction.  Then, I asked if they would name one thing that they have done or seen done at this or any other Wine Auction they have participated in that (for lack of a better term) was just awful? Something they would caution anyone against doing at their Wine Auction?

Marshall Jones credited Harvey Kronberg with the quote “The one thing that makes a successful auction is a combination of three things: product, people and purpose.” He continued “All three of these have to come together to provide the one thingthat makes it all work: Energy”.  The room has to be electric and full of constant energy.  It cannot wax and wane.  It cannot get too high, too low or too stable.  It just has to be.  If I could add my fourth ‘p’ to that mix it would be ‘permission’.  People have to give themselves permission to feel good about spending their time, money and effort in the auction.  Of course, it could all just come down to whether or not there are enough baby-sitters available that night.”

 Lauren Magli agreed with the importance of energy but had a different “One Thing” to add. “The Vintners are the key” she said. “Without them and their involvement you do not get lots that are as High Quality as you want, and then you don’t get the individuals with affluence and influence in attendance.” 

What not do? Lauren and Harvey both agreed with Marshall. He says, “Never, ever, ever keep a dying or dead lot open.  If something hits the wall, kill it and move on.  Period.  I know it is tough if the nonprofit is counting on the money or if it hurts a donors feelings, especially when the donor is in the room.  Slap a minimum on it and then kill it.  Otherwise, Mr. Energy is leaving the building and he ain’t coming back. Life is not about easy choices, it’s about making choices.”  Here again your selection of a Licensed experienced Auctioneer is the key.

Dan Listrom a key Board member of the Wine and Food Foundation of Texas adds to avoid sales sponsored events or time share events of any kind. It confuses Donors and makes record keeping difficult. He also recommends keeping all retail, small dinners or spa services and art items in the Silent. 

So go forth, Auction, Eat, Drink and be Merry!  And Raise Millions!

Good Luck!