Napa, Calif. -- Winery principals, winery executives and bankers attending the Wine Industry Financial Symposium this week could see the conventional wisdom taking shape. As a cast of well-informed speakers from within and without the wine industry offered their survey results and opinions, some general agreements emerged.

The overall economy appears to have bottomed out, they said. Consumer confidence is no longer going down, the stock market has pulled out of its freefall and now rests on a floor that is very low but beginning to feel solid. Unemployment levels are still high and likely to go higher, but they're a lagging indicator of the economy's health. Another few months or a year on the ground, and the economy will resume stepping up concluded.

So where does the wine industry fit into this picture? That's where the conventional wisdom still lacks form, because the experts didn't agree. Will consumers' drastic trading down to lower-priced wines and their aversion to ordering big-ticket wines at nice restaurants go away with the worst of the recession, or would it remain in their psyches forever?

"Consumers were off the grid for a period of time," said Kaumil Gajrawala, the senior beverage analyst for UBS Investment Bank in New York City. "They realized that the amount of cash they had was critical if their access to borrowing was no longer there." He said the result is that it became cool to save money. Research from Gajrawala and others indicates that more people are eating at home, and that trend agrees with the well-documented growth of off-premise wine sales.

Gajrawala, however, doesn't think that thrift will remain as cool as it is now, which could be good news for reviving sales of more expensive wines. "The U.S. consumer needs a drastic event to really change," he said. "They have not felt fundamentally enough pain to structurally change their behavior."

Another perspective came from two seasoned wine industry marketing consultants, John Gillespie and Christian Miller of Wine Opinions in Napa Valley. They presented a preview of new results from two proprietary surveys that looked closely at wine trade attitudes toward sales and marketing.

Gillespie addressed the consumer behavior question head on: "Is it a cycle or is it a sea change? The industry is just absolutely split on this question," he said.

One question that Wine Opinions asked of the 350 trade members who responded to the survey was how well they agreed with this statement: "With a recovery, I don't expect consumers to return to expensive wines." Nearly identical percentages came down on both sides of the question, but most did agree that consumers are more price-driven than ever--and most are settling for less than top quality.

Two interesting side notes from the surveys showed the importance of new media to the wine trade. Trade members ranked Facebook and LinkedIn as significantly more important for communication than Twitter, MySpace and YouTube.

Their responses indicated also which wine bloggers they're following most closely. From a list of 15 wine bloggers that included those from high-profile wine publications like eRobertParker.com and WineSpectator.com, trade members indicated their frequency of visitation was greatest for Eric Asimov of The New York Times, followed in order by Jancis Robinson, Stephen Tanzer, Eric Orange of LocalWineEvents, Tyler Colman of Dr. Vino tied with Gary Vaynerchuk of WineLibraryTV, and Alder Yarrow of Vinography.

On Monday, when the symposium opened, attendees were buzzing about the news on WineSpecator.com that the new VinCraft Group of investors had made a deal to acquire Kosta Browne winery, the small Sonoma County Pinot Noir specialist, at a price estimated near $40 million. The news lent a little more immediacy to a panel discussion titled "What is the Value of a Wine Business Today?" given that one panelist was the CEO/president of Vincraft, Pete Scott.

Scott said that Vincraft expects to acquire about five other wine companies, and it is considering targets with annual production as low as 5,000 cases per year up to 50,000 cases. "We are looking for high quality and lots of brand equity, with the right size and quality cut," he said. Kosta Browne owns neither vineyards nor a winery. Scott added that vertically integrated companies with vineyards and production facilities are also on the shopping list. "Our focus is on cash generation and cash flow."

William Foley, probably the most active buyer of U.S. wine businesses in the past two years, including Firestone, Sebastiani, Kuleto, Merus, Three Rivers and recently a New Zealand company, also was on the panel. He agreed that he has been looking for small- to medium-sized brands, and said his goal is to put together a portfolio with joint production approaching 1 million cases.

"I am done with buying distressed brands," he said. "It's got to have hard assets, vineyards, production facilities and good brands."

Although the exact timeline for a recovery of premium wine sales never emerged during the symposium, one of the event's founders, David Freed, who is chairman of the vineyard company UCC group, offered some advice for vintners to stay financially healthy.

Freed said that forces beyond the control of most U.S. vintners are consumer demand, the weather, the economy, global supply and consolidation of distribution. And though he didn't literally have the last word about when and how wine sales will turn around, he did say,  "There is no way to tell what the consumer is going to like next," so growers and wineries should focus on the things that are within their control:
• Oversupply: Don't overplant.
• P roduce the best quality wine at the price-point.
• Develop and promote a unique selling proposition for each product.
• Support and promote appellations and regional associations.
• Maintain flexibility and diversity, because consumer tastes will change.

More details and several of the symposium presentations can be viewed at
wineindustryfinancialsymposium.com/financial_symposium.htm.