The Loyalty Structure of Sparkling Wine Brands in Italy

Abstract

This article analyzes consumer loyalty in the Italian market for Prosecco sparkling wines. In particular, we examine the relationship among wine appellation, price, and consumer loyalty. To that effect, we run a Dirichlet model on Nielsen scan data to estimate brand performance measures and study purchase patterns in the sparkling wine market. We find that Prosecco wines benefit from high-consumer loyalty, and that this loyalty can be explained by both the appeal of the Prosecco appellation and its upper-tier price point. We conclude that promotion strategies with deep discounts, as they affect the appellation's image, might hurt consumer loyalty in the long run. (JEL Classifications: D12, L11, L66, M31)

The Italian market of sparkling wines: Latent variable models for brand positioning, customer loyalty, and transitions across brands' preferences

“…Sweet popular drinkers and brut basic drinkers are quite similar and account, together, for 50% of the purchases. These results are also found in Rossetto and Gastaldello (2018), confirming that a high market share is covered by a wide range of brands meeting consumers' preferences (sweet vs. brut) and budget constraints while not paying attention to the regional origin. The Prosecco amateurs segment covers almost one‐third of the market where the purchases come from a large range of families as per size and age but with a higher income.…”

“…The Prosecco amateurs' segment has acquired a significant loyalty while reaching a market share of approximately 30%, lower than the one in the brut popular segment as reported by Rossetto and Gastaldello (2018). Differently from sweet and brut popular segments, the Prosecco amateurs include brands that are supplied by Prosecco's specialized wineries.…”

“…According to Rossetto and Gastaldello (2018), knowledgeable drinkers and luxury drinkers show a low loyalty suggesting a variety‐seeking behavior in these segments.…”

“…Trestini, Giampietri, Szathvary, and Dal Bianco et al (2018) investigated the sparkling wine German market looking at the positioning of Prosecco appellations while checking the consumer perception on Prosecco's appellations. Rossetto and Gastaldello (2018) employed a Dirichlet model on the Italian sparkling wine market, classifying appellations by loyalty and variety‐seeking purchase behavior. They figured out a high loyalty in Prosecco's consumers in the upper price segment, while deep discount price strategies may hurt Prosecco's loyalty in the long run.…”

Price Determinants of Sparkling Wine in Poland: Does Reputation Really Matter?

“…While private reputation plays an important role in both low-priced and highpriced wines, collective reputation in terms of geographical denominations appears to be particularly important for high-priced wines. This is confirmed by Rossetto and Gastaldello [29] who found that wines in the higherprice range benefit from strong consumer loyalty. Verdonk et al [30] highlighted that brand image and rep-utation play an important role in purchasing decisions, as well as advice, recommendations and expert reviews, and consumption occasion.…”