When Terlato parted ways with its flagship Santa Margherita pinot grigio last year, it bid farewell to almost one-third of its business.
How to move on from that kind of loss? It helps to sell one of the fastest-growing wines in the U.S. in the Federalist, a millennial-targeted wine cleverly marketed in conjunction with "Hamilton," the wildly popular Broadway musical.
Together with Seven Daughters, another wine marketed toward young drinkers, the two upstart brands have helped Terlato make up the lost Santa Margherita business and then some, executives said.
Terlato, based outside Chicago, is widely credited with creating demand for pinot grigio in the U.S., beginning with bringing Santa Margherita to the U.S. in 1979. But the maker of the Italian wine and Terlato could not come to terms on continuing the marketing and import of the wine.
Terlato, a privately held company, doesn't disclose financial figures. But Bill Terlato, president of the company, said the business is on pace for a record sales year, even after moving on from its top-selling wine.
"I can tell you, in retrospect, that even though it was not pleasant and kind of an emotional decision for us, especially for my dad [Tony Terlato] who created the category and the brand, in retrospect it was the best thing that ever happened for us," Terlato said. "Being able to shift that energy and attention over a broad basket of brands has allowed some of those brands to explode."
None more so than the Federalist, a brand paying homage to the Founding Fathers that's served at "Hamilton" productions in New York and Chicago. In the past five years, the Federalist brand has gone from zero to 200,000 cases in sales volume, Terlato said, with accelerating growth in the past 18 months as three new wines were introduced: Lodi cabernet sauvignon, Lodi zinfandel and Honest Red Blend.
The Federalist brand targets millennial men, said Terlato, who said he believed some of its success had to do with a pining for the Founding Fathers' integrity in politically divisive times. But the "Hamilton" musical's success was a stroke of sheer luck, he admitted.
