New Wine Needs New Bottles: Challenges in Promoting WineTourism in a Changing and Globalised market

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New Wine Needs New Bottles Challenges in
Promoting Wine Tourism in a Changing and
Globalised market paper prepared for the
International Symposium on Gastronomy and Wine
TourismHELEXPO/PHILOXENIA and Alexandreion
Technological Educational Institute of
Thessaloniki

• C. Michael Hall, Department of Management,
  University of Canterbury, Christchurch, New
  Zealand Docent, Department of Geography,
  University of Oulu, Finland
• michael.hall_at_canterbury.ac.nz

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The turbulence of the wine industry

• International market
• Growth of gatekeepers
• Changing consumer preferences
• Changing consumption patterns
• New challenges for winegrowing regions,
  especially for small producers
• The need to find new distribution channels and
  connections to the consumer and grow the market

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Estimates of number of visits per annum
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Advantages and disadvantages of wine tourism for
winegrowers

• ADVANTAGES
• Consumer exposure
• Brand awareness and loyalty
• Customer relationships
• Better margins
• Additional sales outlet
• Market intelligence on products and consumers
• Education of consumers

• DISADVANTAGES
• Increased costs and management time
• Capital required
• Inability to significantly increase sales, ie.
  Because of location
• Opportunity costs
• Seasonality issues

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Benefits to tourism and hospitality operators and
region

• Association with a quality product
• Food tourism is a differentiated product
• Food tourism is an attraction
• May help extend length of stay and increase
  visitor expenditure on local product
• - A possible negative is that sometimes focussing
  on wine tourism may mean other opportunities are
  not explored

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Product driven vs an experiential approach in
wine marketing
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Importance of the intangible
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Modes of designed qualities in wine products
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TOURISTIC TERROIRWinery Example
Accommodation
Winery (setting)
Regional cuisine
Previous experience
Wine tasting on-site
Regional wineries
Attitudes
Personal
Other Attractions
Regional Population
Interpersonal
Scenery
Festivals Events
Personality
Internal Motives
Architecture
CONCEPTS
Wine appreciation clubs
Socio- demo- graphics
Expectations
Festivals
Restaurants
Wine shows
Home
Source Mitchell (forthcoming)
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Ranking of motivations for visit to cellar door
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Cellar door experiential marketing approach
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DIFFERENT STAGES OF TRAVEL

• Decision to travel - Wine at home (pre-travel)
  Kitchen table travel Dining out (pre-travel) a
  form of vicarious exploration
• 2 Travel to the destination
• Wine at the destination - Linked to tourist
  terroir
• Return travel
• Wine recollection (post-travel) - every time the
  bottle is opened the memory should be reinforced
  also use of relationship marketing via the web,
  magazines and the wine retailer. Every purchase
  should reinforce that relationship and influence
  world of mouth and return decisions

CONCEPTS
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3-D MODEL OF TOURISM EXPERIENCES
UNFAMILIAR/REMOTE
Setting
Stage of Travel (Time)
FUTURE
Wine at Home
Wine on site
Antici-pated visit
Meal at Home
FAMILIAR
REAL
IMAGINED
PAST
Activity
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NEW ZEALAND WINERIES attitudes to tourism
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SALES MARKETING

• Three most stated reasons for winery visitation
  are
• Tasting wines 91.5
• Buying wines 82.9
• Learning about wines 57.3
• Three most offered services are
• Wine tasting 91.1
• Winery tours 50.6
• Tasting and snack foods 40.5

INDUSTRY MARKETING
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SALES

• Availability of wine outside the cellar door
• Wines not available locally 8.1
• Most likely place to find the wines
• Local cafes and restaurants 93.1
• Specialty wine stores 88.2
• Supermarkets 59.8

INDUSTRY MARKETING
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MARKETING

• 52.2 are part of a commercially run tour
• 79.8 attend one or more wine and food festivals
• The most preferred information sources to attract
  visitors
• Wine trail or road signage 63.4
• Regional wineries brochures 55.0
• Wine and food festivals 54.8

INDUSTRY MARKETING
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THE VALUE OF TOURISM

• 73.2 believe wine tourism enhances product/brand
  awareness
• 54.2 believe wine tourism is a catalyst for mail
  order sales growth
• 69.8 believe customer education is a valued
  output of wine tourism

INDUSTRY ATTITUDE
precentage stating agree/strongly agree
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Overall Attitudes Toward Wine Tourism
INDUSTRY ATTITUDE
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INTEREST PROFILE
INDUSTRY ESTIMATE
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CONSUMERS
Sources Hall (1996) Charters Ali-Knight
(2002)
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VICTORIA (AUSTRALIA) value segments
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TWO CORE SEGMENTS

• Wine food core to tourism experience
• Socially Aware
• Tertiary educated, professionals (govt)
• Attracted to things new innovative
• Learning a living
• Visible Achievers
• Wealth creators, around 40 years old
• Traditional values on home, work society
• Work for financial reward job stimulation
• Look for quality value for money

CONSUMERS
Tourism Victoria (2000)
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IMPORTANT SUB-SEGMENTS

• Combines demographics values
• Socially Aware, young couples
• under 45 years
• single with no children
• Visible Achievement, midlife households
• 45-65 years
• single or married with children under 16

CONSUMERS
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Other SUB-SEGMENTS

• Strong interest in food and wine tourism
• Young Optimist
• young singles
• Traditional Family Life
• midlife households

CONSUMERS
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TEXAS WINERIES attributes on-site sales
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TANGIBLES INTANGIBLES

• Several elements influence attitude purchase
  on-site
• The wine itself
• Product
• The winerysphysical attributes
• Servicescape
• The staff/personnel
• Service

TEXAS WINERIES
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INFLUENCES ON BEHAVIOURwine attributes
TEXAS WINERIES
Dodd 2000
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INFLUENCES ON BEHAVIOUR service characteristics
TEXAS WINERIES
Dodd 2000
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INFLUENCES ON BEHAVIOUR winery aesthetics
TEXAS WINERIES
Dodd 2000
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NEW ZEALAND WINERY VISITORS post-visit behaviour
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POST-VISIT PURCHASE
POST-VISIT
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DIFFERENT SEGMENT PURCHASE DIFFERENTLY
POST-VISIT
Category I lt200HL, Category II 200HL-2ML,
Category III gt2ML
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DIFFERENT SEGMENT PURCHASE DIFFERENTLY
POST-VISIT
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HIGHLIGHTING GENDER

• Males more likely to purchase at cellar door
• No gender difference in intention to post-visit
  purchase
• (Mitchell Hall 2001a)
• YET females actually more likely to post-visit
  purchase
• Why is unclear

POST-VISIT
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Implications of Gender Difference

• Females often less of a focus at cellar door
• Especially as buy less at cellar door
• Females are more critical of experience
• But less critical of wine
• Wineries need to provide appropriate experience
• Ignore the fact that not purchasing at the winery
• Have greatest post-visit purchase potential

POST-VISIT
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REPEAT VISITORS MORE LIKELY TO PURCHASE
POST-VISIT
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REPEAT VISITATION

• Only a short period since visit
• i.e. six to eight months
• Therefore only 18.2
• BUT subsequent visitors were more likely to be
  repeat visitors
• 27 (compared with 3.5)
• 3 visits p.a. (compared with 1)

POST-VISIT
Note visit per year are medians
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WORD-OF-MOUTH
POST-VISIT
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PURCHASERS ALSO RECOMMENDED
POST-VISIT
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REASONS FORPOST-VISIT PURCHASE
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Winery servicescapes
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Winery servicescapes

• The servicescape is the physical evidence of a
  service
• What is an appropriate design for wineries
  engaging in wine tourism
• Need to understand how the winery is perceived
  and what the expectations of markets are - and
  how these canbe best matched
• Servicescapes under researched. This research
  from Canterbury wineries in New Zealand completed
  October 2007.

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Consumer perceptions
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Consumer expectations
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By gender and generation
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Future drinkers Generation Y
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Need to understand future wine generations
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Preferred alcoholic drink
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Gender and Red/White wine preference
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Gen Y perceptions of wine industry
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Cellar door attitudes and behaviours

• 80 had been
• Out of 20 reasons, the top five were not directly
  related to wine. The most commonly selected
  responses were eating at the winery (56), for
  the experience (55), a day out (54), and
  because their family was going (47). Tasting
  wine was the 6th most mentioned reason at 45
• only 36 of respondents have actually taken part
  in a wine tasting.(However, they would like too!)

Visit to a winery
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Conclusions

• Understand market and product and match them
• And the product is the experience, not the
  physical aspects of the wine
• Consider access to market and the bigger business
  strategy - including how you might be
  differentiated. This is especially important for
  small wineries with limited capital.

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Thanks for listening