“How Naples, Fla., Bested Napa, Calif., At Its Wine Game”
East Coast Oenophiles Know How to Treat a Billionaire At Exclusive Charity Event

By Julia Flynn Siler

NAPA, Calif. — The Napa Valley Wine Auction, where a six-liter bottle of cabernet sauvignon once sold for a half-million dollars, was the grande dame of charity wine auctions for nearly a quarter century. Founded in 1981, it drew moneyed oenophiles, celebrity chefs and Hollywood stars to this wine region for a long weekend each June.

But Napa’s great success inspired others to get into the same game. And last year, the three-year-old Naples Winter Wine Festival trumpeted itself as “the world’s top charity wine event” after it said it raised $7.67 million for a long list of charities. Napa said it had raised only $5.3 million.

Naples, the one in Florida, is a city built partly on reclaimed swamp, and it isn’t known for viticulture. Nor, indeed, is Florida. Napa’s pride was dented.

Vowing a comeback, the Napa Valley Vintners, the powerful group of winery owners behind the Napa auction, did some soul-searching. Among their conclusions: Napa’s auction had grown too big and too boring, and it sometimes didn’t treat billionaires as well as it might have.

The organizers did a radical makeover, tripling ticket prices to make the auction more exclusive and hiring Jay Leno as an opener. Naples “really put the bug in our ear,” says Margrit Biever Mondavi, one of the 24 co-chairpersons of Napa’s event and a member of the Mondavi wine family.

One evening earlier this month under a tent on a golf fairway, Napa opened the auction meant to take back its rightful role as the pre-eminent charity wine auction in America. The auction got off to a promising start: A surprise first item, a dinner jacket made of wine corks, far exceeded expectations by selling for $95,000. Other strong bidding followed. “This is a performer’s dream,” said Mr. Leno as the auction got rolling: “Rich people who’ve been drinking.”

Recapturing the crown was key for the Napa Valley Vintners, who had used their auction’s high profile to market Napa as a wine lover’s Eden. It had long been a prestigious social event, drawing international media attention and regulars like former baseball star Rusty Staub and “Sex and the City” actor Kyle MacLachlan. People paid $2,500 a couple to attend.

By 2001, there were hundreds of other charity wine auctions in the U.S. None came close to Napa’s. And no one in Napa felt threatened when a group of oenophiles announced they would start an auction in Naples.

But Naples organizers, a well-connected group of eighteen couples, aimed to get big. The year before, they had gathered intelligence at Napa’s 2000 auction, taking notes and quietly chatting with attendees. The Naples crew spotted weaknesses. Napa had swelled to about 2,500 guests, making it noisy and less elite. Big bidders wanted to consort with vintners and winemakers, not the marketing staff they tripped over in Napa.

So Naples kept attendance to a few hundred, charging $5,000 a couple, twice what Napa charged. It kept pre-auction “hospitality” events, in which bidders mingle with vintners, much smaller than Napa’s.

Naples faced one hurdle: Naples itself, located on the Gulf of Mexico in Southwest Florida. “Obviously, Naples is not Napa,” says Jeff Gargiulo, a Naples founder. “You won’t see any grapes growing around here.” The group at first had trouble persuading top vintners and celebrity chefs to attend. So they lined up private jets to fly in some attendees. They lured a few big-name vintners to help draw others. A big catch was Dick Grace, a Napa cult-wine producer. “When we brought Dick Grace here, we got instant credibility,” says Mr. Gargiulo, a Napa vintner, who hails from Naples and is the chief executive officer of Sunkist Growers Inc.

Naples’s first auction, in 2001, raised $2.7 million, according to its figures. That wasn’t enough to concern Napa vintners, some of whom attended the Florida event. Nor was the $3.4 million that Naples said it raised in 2002; Napa said it raised $6.1 million that year. “I’d never even heard of Naples, Fla.,” says vintner Stu Smith, a co-chairperson of the recent Napa auction.

But Napa couldn’t ignore Naples after February 2003. Naples’s third auction, promoters said, raised $5.1 million, close to Napa’s previous reported take. Four months later, the Napa auction reportedly raised $6.4 million, and Napa’s bidders and vintners aired some gripes in a survey following the auction.

The two events account differently for their total takes. Napa says its total doesn’t include ticket sales, which help underwrite the event. The Naples organizers say they included ticket sales in some years and that many of the costs are underwritten by trustees and sponsors. The competing auctions have accepted each other’s official numbers. Napa officials say they are aware of the accounting difference but don’t challenge Naples’s claims.

The Napa vintners decided to revamp the auction, appointing 24 chairpeople so no one would be singled out should the effort flop. Some of those who had attended Naples’s 2004 auction made comparisons. Naples’s auction was briefer. It treated its 600 guests to elegant soirees at founders’ homes, while Napa’s 2,000 guests faced a noisy and impersonal ball under a tent. Napa’s auction “was just getting too long, and there were too many people,” says Ms. Biever Mondavi.

And Naples did more to pamper its guests. Naples put vintners up at the local Ritz Carlton; Napa’s guests were on their own for lodging. Naples moved attendees between venues in stretch limousines; Napa used buses. Naples greeted dignitaries at the airport with cheerleaders and a marching band.

On a corporate-jet ride back to California, the Napa group decided that they would push for change. It wasn’t in time to keep the crown: According to its numbers, Napa’s 2004 event raised $5.3 million, versus the $7.6 million Naples said it had raised in February.

Napa spent the next months revamping. It tossed the crowded ball in favor of Naples-inspired intimate parties. It cut the live auction to four hours, from six, and hired chauffeured cars for big bidders. It raised admission to $7,500 a couple and changed the name of the event to Auction Napa Valley. To add buzz, Napa hired Mr. Leno and brought together Peter and Robert Mondavi, the nonagenarian brothers famed for the feud that estranged them after Robert punched Peter in 1965. “We’ve learned some things from Naples,” says Barbara Shafer, a co-chairperson of the Napa event. Her family owns Shafer Vineyards, a prestigious winery in Napa Valley.

Still, ticket sales were sluggish, forcing Napa to cancel some events. Calling the high price “a dumb idea,” co-chair Mr. Smith and others prepared for a rout. But auction day dawned brighter. The pampering had paid off in pre-auction events. “The more important bidders were recognized rather than being buried in the crowd,” says billionaire vintner Jess Jackson, the founder of Kendall-Jackson, who attended both the Naples and Napa auctions in 2005.

Mid-auction, Napa looked to have a chance. The number to beat was $11.1 million, Naples’s reported February take before ticket sales, and most lots were selling for more than expected. A barrel from the formerly feuding Mondavis fetched $401,000. (“Hang on,” Mr. Leno wisecracked: “The brothers have started punching each other again!”) A lot featuring a bit part on “Desperate Housewives” sold twice, for a total of $580,000.

When the last gavel fell, cannons shot confetti over the crowd. The next day came Napa’s final tally: $10.5 million. Naples had kept the crown by a $600,000 margin. Linda Reiff, executive director of the Napa group, says Napa won’t dispute Naples’s claim to the crown because “it’s not worth it for us to get into a back-and-forth.”

Copyright (c) 2005, Dow Jones & Company, Inc.