Ted Baseler (b. 1954) grew up in Bellevue, graduated in communications from Washington State University and earned a master's degree in journalism at Northwestern University in Illinois. Starting out in the advertising business at the J. Walter Thompson agency in Chicago, Baseler excelled as a marketer of consumer packaged goods. Back in Seattle in the early 1980s, a job with Cole & Webber Advertising landed him the account of a still-fresh Woodinville winery, Chateau Ste. Michelle. In 1984, Ste. Michelle hired him as its marketing director. He later moved up to Chief Operating Officer, and in 2002 was promoted to CEO. Before his retirement in 2018, Baseler led the company through a period of industry challenges, massive growth, and consequential innovations. Throughout, Baseler believed in supporting the advancement of associated scientific studies and practices, as well as promoting the entire state’s burgeoning wine industry. For this interview, Baseler sat down with HistoryLink's Peter Blecha at Chateau Ste. Michelle on October 13, 2016.
Ste. Michelle's Masterstroke
Peter Blecha: Tell me about Wally Opdycke, the original founder and president of Chateau Ste. Michelle.
Ted Baseler: Now this man was either brilliant or lucky. And maybe both. But, he decided to build the Chateau in Woodinville, which was very unusual. Most great wineries are in the wine region. So it would’ve been much easier to build it in Yakima, or build it in Prosser, or Walla Walla, or somewhere in Eastern Washington. Yet, he decided that it would make more sense to build it here in Woodinville on the Stimson estate. And at the time the winery opened, the expectation was we’d get maybe, you know, 40, 50 thousand tourists a year, and they would come out and enjoy the grounds and everything. Well we, in the last 10 years, averaged over 300,000. This is most likely the most-toured winery in the world. And it’s the access to a major metropolitan area. It’s the kind of activities we have here, the historical significance of the winery. And you think about it in hindsight: certainly, what a smart decision.
PB: Chateau Ste. Michelle is clearly the big gorilla in the Washington wine business. How do you see that this winery fits in the industry?
TB: Our business philosophy has always been to help the industry and to be at the forefront. And I think we’ve really demonstrated much more of a collegial approach to business, principally because we want to grow the Washington state category. We’re not focused on market share. We’re not trying to beat out some little guy. It makes no sense. And collectively we do much better together. And I think most people would agree with that thesis. I mean, there are probably a few people that are struggling that might think we’re the big gorilla, but the vast majority understand our investment in the business and what we’re willing to do.
Oftentimes we’ll forgo our own identity or success for the good of the industry. A few examples would be that in 2004, there was a really bad freeze in Washington. And so we said, 'let’s call our friends, our competitors. We want to keep them whole.' So, we called lots of wineries and we said, 'Hey, listen, you guys need grapes. We’ll get you grapes and we will help you make wine this year because we want you to be in business. We want you to be successful.' And it was really kind of surprising to a lot of people. Now, I don't understand why we wouldn’t have done that. But there’s some people in cutthroat industries that just say, 'We’d never help a competitor.' So that was an important event.
Advancing the Science of Winemaking
PB: Tell me about the role that Chateau Ste. Michelle played in the formation of the new Wine Science Center in Richland.
TB: We were very instrumental in creating the WSU Wine Science Center. And so we invested a lot of time and personal money and business investments in creating this world-class center. University of California Davis was phenomenally helpful. It was kind of shockingly helpful because they’ve always had kind of the corner on the market for enology and viticulture education ... But when I asked them why they were so supportive of our programs -- we kept sending people down there and they would say, you know, this is what you do. This is what you don’t do. This is where you’ll waste money. And they were phenomenal. They said, 'Hey, there ought to be at least a dozen in the United States. Now there’ll be two. It’s not a competition.' But that was impressive.
PB: A certain amount of science has long been an important part of grape growing and wine making ...
TB: So it’s really important, and I think -- you talk about the future of the industry -- and this, I think, is going to be a cornerstone of excellence. The kind of research. Teaching future viticulturists and winemakers. Very scientific. We’ve got PhDs, master's students. Actually, I think now there are more students there than at Cal Davis -- because they put a limitation on the number of graduates. So in terms of what it’ll impact as far as the quality of Washington wines going to the future, it’ll be tremendous. But even more importantly, in case of some kind of a virus or pest or some kind of a problem in the vineyards that could literally wipe things out, we’re going to have top scientists there working to solve those problems. So for me, it’s very exciting to have that as a part of our contribution to the wine industry.
Early challenges at Ste. Michelle
PB: I guess what I would like to hear from you more about is your first days and weeks here. I’d like to know if there were some structural weaknesses here when you first came aboard under Alan Shoup’s leadership. Anything that just jumped out at you that needed fixing? Were there some structural weaknesses to the business or to the marketing, or would you put it that way?
TB: Well, yeah. I mean, first off: we didn't hardly have any sales people. You can’t build a national market [without that]. And so most of the market was in Washington state and there was very little around the world. So, we had to build a sales force that could take us to 50 states and now we’re in a hundred countries. That was kind of one significant issue. The other kind of dilemma we had was: We had fine-wine people that loved to just wax on about great wines of the world, and European wines and everything. And then we had the reality of, 'Well, we’ve gotta make a profit.' So that was a timeframe when he had these kind of culture clashes. And I came from more of a pure business background, and analytical approach to business. And so, there were times when the people would be going on these long expressions of wine, beauty, and it’s like: 'Okay, [but] we got to sell some boxes.' So that really promoting, advertising, developing a national blueprint, or footprint, for our wines really helped.
PB: Are there any notable factors involving grape-growing or winemaking in Washington that set it apart from other areas around the world?
TB: Yeah. And I think there’s some unique aspects to the vineyards here. One in particular is that all the vines are on the original rootstock. So, in almost the entire world, vines are planted on American rootstock. And we think it’s a distinct advantage from a flavor perspective to have the original rootstock. So, Europeans began importing plants from the United States, and with that there was this little root louse called phylloxera, and it devastated almost all of Europe and then virtually everywhere in the world. And yet, we don’t have that [knock on wood]. We don’t think we have it. And as a consequence, we’re able to, one of the few places in the world we’re able to plant our vines on rootstock.
PB: Dr. Walter Clore – who is widely regarded as the Father of Washington Wine – made some significant early scientific discoveries while he was serving as a horticulturist at Washington State College and then at the Experimental Station in Prosser. His observations and conclusions really benefited the state’s entire wine industry.
TB: The other interesting aspect to the discovery in Eastern Washington -- and Walter Clore was a big part of this -- was understanding which vineyard sites would not have winter freeze. Because originally, people ... the belief was, back in the thirties -- ’30s and ’40s and ’50s -- you’d have to bury your vines every year to protect them from winter damage. Well, they learned that if you were closer to the river, it would stay more moderate. It’d be better airflow. And now we're planning many of the new vineyards that will be close to the river, because it's protected from severe winter damage. So those are things we’ve learned over time. And as these vineyards have been planted, they’re extensively around the Columbia River and Snake River and so forth. So there’s been tremendous learning over decades and decades.
Washington Takes Off
PB: In hindsight it is kind of amazing – the trajectory that the commercial wine business took over the decades: the early popularity of fruit wines, the rise of Riesling, the period of Merlot dominance here in Washington, the emergence of Cabernet and then Syrah as popular favorites ...
TB: Pretty remarkable when you think about all these events that took place. Probably in the ’90s or late-’80s, ’90s, Kendall Jackson figured out how to make slightly sweet Chardonnay and that became very popular. But I would say Washington really started to take off -- kind of in the mid- to late-‘90s is when things really got exciting here. And people were opening up more and more wineries and, you know, had great wineries like Leonetti and Woodward Canyon creating phenomenal wines that ... you know, we put together a Total Quality Management Program and we were able to quickly ramp up. And I think what they demonstrated was: you can make world-class wines in Washington. We made very good wines but, thanks to them, I think we said: 'We can make even better wines.' And we put in this quality regime and invested millions of dollars in French oak barrels and ramped things up dramatically.
PB: Do you think there’s any chance Washington would ever overtake California, either in quality or just overall production quantity?
TB: So there are wonderful wines in California. Napa, Sonoma, Central Coast, and other areas are producing pretty spectacular wines. I think in the long run we've got some advantages here -- because of weather, soil type, potential water access -- versus California. But, if you look at the statistics right now, there are about 600,000 acres of vinifera vines in California. We have about 60 [thousand]. So: 10 to 1. So they’re way ahead of us.
However, if you say "premium" acres produce wine selling above $7 -- and that’s actually kind of the cut-point. You think, well, 'Seven bucks? That’s premium?' Well, seven to seven hundred. So in premium acres, we’re a hundred percent. We have no sub-premium, virtually no sub-premium wines here, because you can’t afford [to produce those]. It’s actually a fairly low-yield region. So let’s say, let’s give ours 60,000 [acres]. If you take about 40 percent of the California number -- and it’s probably even a little less than that -- you come out with about 180,000 cases. So we’re at sixty today [and] they’re ripping vineyards out in California. I think in 25 to 20 years, we’ll be at over 200 [thousand acres planted to vine]. So in total acreage, I doubt that we’ll ever eclipse California. In premium acres, I think it’s highly probable that in 15 to 20 years we’ll have more acreage than California. Which is very exciting. Because it’ll create jobs. It creates tourism. You know, not just the principal jobs in the industry that are good-paying jobs, but it will create a tourism industry.
Further reading: HistoryLink's biography of Ted Baseler by Peter Blecha