Fighting False Monsters: Lessons for the Wine Industry from Don Quixote

One of my New Year’s resolutions is to read Don Quixote in its entirety, in Spanish. No, not the original 17th century version. Even with annotations in the margins to help me along, I’m not that brave and have no delusions about my ability to get through even five pages of that text. I’m reading Andrés Trapiello’s definitive castellano translation that university students are now tasked with reading. I’m doing it in honor of my college Spanish linguistics professor, a quixotic Castilian teacher who wore ascots, sported a pointed-beard and tortured all of us undergraduates by requiring us to master the textbook "Los 1,001 Años de la Lengua Española" to receive our minor degrees in Spanish. I still remember thinking, “Seriously, Señor García? One thousand and one years??”

I’ve kept that textbook with me since college, and it has become a sort of totem, staring at me from my bookcase and compelling me to do things that frighten me. In a bit of a ritual, I pull it off my bookshelf around the holidays, thumb through it to see my notes of frustration in the margins and motivate myself to do something difficult in the new year.

An unexpected result of committing myself to not only read this book in its entirety, but to read it in Spanish is that I’m diving into its universal themes through the lens of another language and culture and it’s making me think of all the axiomatic business principles that this great novel has within its pages. In fact, as I’m organizing my calendar and my suitcase for traveling to Spain soon for Barcelona Wine Week, I’m reminded of the seemingly insurmountable challenges that the wine business was facing last year at this time and how many of my friends, colleagues, and even potential clients wasted hours, days and months “tilting at windmills” as they fought monsters that didn’t exist. Last February started the beating of the Liberation Day drum that culminated in the Trump administration’s tariff announcement. I recall that last year at this time, a 50% tariff on alcohol imports from Europe was on the table. These tariff threats, coupled with two years of normal contraction after an extremely abnormal covid-era consumption boom and some fundamental changes in consumer demographics and behavior had people rather frightened at both Barcelona Wine Week and Wine Paris last year.

If Don Quixote teaches us anything, it’s that humans need stories to make sense out of an otherwise simultaneously terrifying and boring world. This can be a very positive thing. In marketing, for instance, this is best articulated in Donald Miller’s book Building a Story Brand where he reminds us that we should make the customer the hero of our brand story. Don Quixote reminds us, though, that in addition to the positive construction that storytelling and story building do in our lives, we often grab onto false narratives, get caught up in self-fulfilling prophecies, or wallow in rayarse: that beautiful Spanish verb that means we’re acting like a broken record, stuck on a negative topic and failing to move forward.

As we approach this year’s great global wine trade fairs with drumbeats about Greenland and fresh tariff battle tensions, I’d like to offer some perspective framed in Don Quixote themes:

 1) Beware of the Encantadores

The word encantador means “enchanter” in Don Quixote, and these various spell-casters are a central driver in Quixote’s delusions. The word stems from the Latin incantador (to sing upon) and so I read it as being related to the idea of the Siren song in the Odyssey. Business is full of encantadores. We blindly follow the siren songs leading us down seemingly beautiful but irrational paths; but we also get paralyzed into inaction by darker enchantments that make us terrified of failure.

If you believed the doomsday encantadores of last year who sang songs of terror through headlines and posts, you’d maybe throw up your hands and walk away from the whole idea of exporting wine to America. In the meantime, neither consumers in the U.S. nor those within the American wine industry acted with any hostility towards European wine imports, even once tariffs were implemented. California winery leaders such as Jason Haas at Paso Robles’s Tablas Creek Vineyards distributed widely consumed podcasts, posts and blogs about how nobody in the American wine industry wants a wine market that contains only American products (this would hurt the overall market and therefore hurt American wineries), while American wine business leaders such as Harmon Skurnik reminded everyone that premium European wine products are non-fungible. A completely unified contingency of importers and distributors, large and small, also spoke out firmly to remind political windmill dragons that our import and distribution companies are filled with American employees and are American-based businesses.  

The consumer data ended up being on their side, not on the side of the encantadores. Bottled wine (excluding bulk, including still and sparkling) imports into the U.S. from Spain, Italy and France appear to be on track to show increases in value and volume for 2025 (based on preliminary data gathered from U.S. department of commerce and other online sources). Yes, we saw massive surges of imports of European bottled wine ahead of the implementation of the August tariffs, and a natural large drop in August through September, but the preliminary year-end numbers demonstrate that consumer purchases of premium European wine rose and that re-orders occurred, putting bottled still and sparkling wines from Spain, Italy and France in positive volume and value territory for 2025 vs. 2024. There are even some truly bright spots regionally and category wise within that larger data set.

If you tilted towards windmills and spent the year eating your nails in fear of false monsters or blamed the market spellcasters for getting in your way, you missed out on all that business and potential market share. As I said in my previous article last January, the U.S. wine market remains the largest in the world and even with corrections it’s still a 330 million 9L case market (~4 billion bottles). I wouldn’t want to be in the very low end of this market, which is indeed seeing seismic corrections as low-cost alcohol beverage alternatives take market share. But shame on me as a premium winery if I spent 2025 blaming encantadores for my inability to sell my wine in a market of this size.  

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2) Beware of the Cave of Montesinos: Put Events in Proper Context

One of my favorite parts of the story is the segment where Don Quixote and Sancho find a deep cave in La Mancha and Quixote insists (again) that it’s enchanted and that he wants to explore its secrets. Sancho and La Humanista (a student) therefore lower Quixote with a rope into the cave. They pull him back up a half hour later and he’s asleep. When Don Quixote awakes, he claims that he was in the cave for several days, and even saw the enchanted Dulcinea, another figment of his imagination. At this point Sancho basically says, “this guy is crazy.”

As funny as the scene is, we do the exact same thing all of the time in business: we take one brief moment in history, one headline (or several) and conflate them into grand or historic significance as if we’ve lost all perspective for business cycles or even the true time cycle of the industry we’re operating within. As far as we know, wine has been consumed by humans for around 10,000 years. Percentage wise, the events of the last four years in our industry, no matter how significant, represent 0.04% of our business timeline. To put that in context, if the last 10,000 years were one day, the last four years would represent about 3.5 seconds of that day. Yet we constantly exaggerate present moments and forget the true scope of normal business cycles, natural changes in consumer packaging preferences, and even normal progress in marketing both in terms of messaging and mechanics. The popular 1970s print advertisements for Club canned cocktails showing seemingly inebriated and annoying people with the tagline “Hit Me With a Club” probably wouldn’t work well with today’s RTD (ready-to-drink canned cocktails) consumer. But let’s not forget that Club cocktails were RTDs and they were as ubiquitous in the 70s and 80s as Blue Nun Riesling. We seem to be in a 50-year cycle of resurfacing the same old thing, simply with a new message.

Rob McMillan points out in this year’s newly published Silicon Valley Bank State of the Wine Industry report that many of the wineries interviewed are doing quite well and claim they have either seen or are close to seeing a bottom in this cycle. He also points out that the common thread among those wineries is that they have adapted and aren’t hoping for some quixotic, romanticized “return to normal.” Evolution and adaptation are required in our industry. Let’s not conflate the current cycle with some doomsday or claim that its significance is larger than the impact of phylloxera in Europe in the 1800s, two World Wars, or even the near collapse of the global economy during the Great Recession.

3) Beware of Realism Without Courage

The final lesson of Don Quixote for the premium wine business is not even particular to this great novel. It’s the tried-and-true notion that the opposite of romantic and unrealistic fantasizing in business is “paralysis by analysis.” Don Quixote is considered the first modern novel because the protagonist confronts a world that is essentially mundane and his narrative fantasies are exposed as romantic at best and insane at worst. Yet, Quixote is a hero because he refuses to let the mundane and banal reality of existence and life rob him of his spirit. In business, reality checks can be the difference between surviving and failing. But realism without courage is paralysis and no business has ever succeeded in taking market share from competitors through “comiendo las uñas” (eating one’s nails). At some point, we must sort through what is false enchantment, give proper context to our plans and the business cycles that we’re facing, and then mount our horse and ride. Hidalgo Alonso Quijano mounts a horse and transforms himself into Don Quixote of La Mancha. He does something rather than succumb to the emptiness of inaction. Being careful to the point of inaction is not good management. It’s paralysis. If you're paralyzed by analysis, you will be passed by competitors, as quixotic as they may seem.