The country-brand in the wine industry: how important is variety specialization?

Abstract

Purpose The purpose of this paper is to analyze whether or not the reputation of a region/country in the international wine market depends on a region/country’s efforts to specialize in a specific grape variety. Design/methodology/approach Data on 19,959 bottles of wine corresponding to six vintages across ten wine producing regions worldwide are used to estimate a hedonic price model that measures consumer valuations of the different wine attributes. Findings The results of this study show that although variety specialization has successfully underpinned the reputation of some New World regions, such as the Napa Valley (with its Cabernet Sauvignon) or Oregon (with its Pinot Noir); in others, such as Australia (with its Shiraz), this has not been successful. Practical implications Over the last ten years, the exponential growth of Australian bulk wine exports has seriously harmed the reputation of Australian wine. With respect to the Napa Valley wines, price discount received by Australian wines increases between the 1997 and 2007 vintage from 33 to 61 percent. Thus, in order to successfully build a collective reputation of an entrant (New World) country, an institutional framework that mediates differences of interest between the large and small vineyards and, above all, that regulates the free-rider problem in the wine market is required. Originality/value This paper empirically illustrates how cooperative (and non-cooperative) behavior between firms can help to build (and to destroy) collective reputation of wines that come from the same region or country.

Behind the wine glass: values that guide consumption in Minas Gerais – Brazil

“…In the context of global viticulture, Banks and Overton (2010) mention the existence of an elucidated dichotomy between the producers and consumers of the Old and New World of viticulture that guides market strategies and have an effect on consumer behavior in the sector. Berríos and Saens (2015) state that in the Old World, regions have pre-existing reputations for the glamour and refinement of their winemaking so that the fine wines produced there are sold at higher prices due to the myths about the sophistication and elegance of viticulture created among the artisanal growers. In turn, the authors state that winemakers in the New World have been able to link their labels to the image of low-cost differentiated wines of excellent quality due to their place of origin.…”

The hedonic price model for the wine market: A systematic and comparative review of the literature

“…The significance of geographical indications is also notable in the case of New World wines (Berrios & Saens, 2012, 2015; Defrancesco et al., 2012). Some studies have delved into the interaction between individual and collective reputation, revealing various relationships: substitutive (Cacchiarelli et al., 2014; Cardebat & Figuet, 2009; Ling & Lockshin, 2003; Schamel, 2003), complementary or non‐rival (Cardebat & Figuet, 2004; Schamel, 2000), or with collective reputation being more significant for lower‐quality wines and individual reputation being more relevant for higher‐quality wines (Caracciolo et al., 2016; Costanigro et al., 2010; Rabkin & Beatly, 2007; Schamel, 2006, 2009).…”

O valor de um país na internet: uma proposta de modelo para construção do country brand equity nas redes sociais digitais

“…Nesse sentido o exercício de construção da marca de uma nação é muito mais do que a simples concepção de um logotipo ou de uma campanha publicitária, ela dependente do monitoramento da percepção coletiva dessa marca e das informações sobre ela veiculadas. Para se garantir o sucesso as ações de country branding devem sempre ser acompanhadas de iniciativas governamentais, de planos para o desenvolvimento econômico e de políticas públicas de incentivo ao turismo (Berríos & Saens, 2015), além de participações em eventos de promoção da cultura nacional no exterior.…”