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w w w. v w m m e d i a . c o m M a y - J u n e 2 015 | V I N E YA R D & W I N E RY M A N A G E M E N T 8 9 often "tied" to one producer, serving only one type of beer per bar. Breweries paid saloon owners to carry their beer in exchange for paying for licens- es, furniture, signage, legal fees and anything else needed to open. After Prohibition ended, alcohol was heavily regu- lated, and the federal government created tied-house laws to maintain three separate tiers – manufacturers, wholesalers and retailers – in order to rein in saloons being dominated by breweries that pressured owners to drop prices to compete for business, and aggres- sively advertised to get customers. Tied-house laws prohibit alcoholic beverage man- ufacturers and wholesalers from holding any inter- est in the retail side of the business, or providing something of value to retailers, influencing them to carry their product over a competitor's. Advertising is considered a "thing of value," making it unlawful for brands to promote one retailer over another. The government allowed states to create their own laws regarding alcohol. TIED-HOUSE LAWS IN THE DIGITAL WORLD More than 80 years later, the Internet has changed the way wine is purchased and advertised, yet many of the laws regulating the alcohol industry still date to the repeal of Prohibition. Social media has become an important marketing tool for wineries to connect with consumers, share information about wines and create brand aware- ness. Beth Costa, executive director of the North- ern Sonoma Wine Road noted, "When wineries first started using social media, many were careful about dipping their toes in because of the laws concerning wine and advertising." As existing social networks such as Facebook and Twitter grew and new networks emerged, wine mar- + Federal tied-house laws were created after the repeal of Prohibition to keep big alcohol produc- ers from dominating retailers. + Producers are prohibited from giving anything of value to a retailer, including free advertising. Social media is considered free advertising. + Wineries cannot promote any single alcohol retailer over another, including restaurants, wine shops, grocery stores, hotels, airlines and golf clubs. + Conduct an audit of your winery's marketing, social media and event efforts, and plan content to ensure that it meets regulations. AT A GLANCE © 2014 Key Technology, Inc. Want to produce a 100 point wine? Key's VitiSort ™ wine grape sorter provides an unprecedented level of quality control for winemakers - at an affordable price. s Produce consistent, high quality wine year after year s Up to 99.9% MOG removal - based on your criteria s Reduce sorting labor costs by up to 80% s Lowest cost grape sorter on the market Contact us today at 509.529.2161 to learn how VitiSort can help you put only fl awless grapes in your bottle. VitiSort ™ can make the difference. VitiSort ™ Optical Wine Grape Sorter www.key.net