The Portuguese Luxury Wine Market: A Study on the Perceptions of Wine Brand Managers

The Portuguese Luxury Wine Market: A Study on the Perceptions of Wine Brand Managers

Nuno Metello de Nápoles (University of Porto, Portugal), Helena Nobre (University of Aveiro, Portugal) and Raquel Meneses (University of Porto, Portugal)
DOI: 10.4018/978-1-7998-3115-0.ch017

Abstract

Wine has been a part of human history for thousands of years, serving both social and religious roles. Just a few centuries ago, it became possible to store wine in good conditions, allowing it to be bottled and aged, which created a luxury product, consumed as a token of prestige. This study aimed to analyse wine brand managers' perceptions on the motivations behind luxury wine consumption. Given the exploratory nature of the study, eight interviews with Portuguese luxury wine producers and distributors' managers have been undertaken. The content analysis of the interviews seems to indicate that, overall, there is a strong understanding of the consumers' motivations. Yet, there are certain more specific aspects with the potential to be explored in order to raise the efficiency of the strategies being employed.
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Introduction

Luxury wine has been gaining increasing importance in the global market, in which there is an increase in the demand and consumption of luxury wine brands (Wolf, Morrish, & Fountain, 2016). The research was carried out on the Portuguese wine market, characterized by small wine producers and a proliferation of private wine brands, generally lacking international recognition. Most Portuguese wine brands belong to a small group of medium/large companies that control the distribution channels domestically and abroad. Portugal represents an interesting research setting as it is the country with the highest annual per capita consumption of wine, according to 2017 data from the International Organisation of Vine and Wine (OIV), but, on the other hand, the luxury wine sector is still underrepresented.

The notion of luxury has always existed throughout human history, although it might not have been formally defined since the beginning, and interpreted in different ways, such as in Ancient Greece. McCants (2007) mentions that, upon the XVIIth century, the supply of more valuable and sumptuous goods has led to a greater separation between social classes. From this perspective, a luxury good is presented as something unique, exclusive and accessible to only a small fraction of the population (Cristini, Kauppinen-Raisanen, Barthod-Prothade, & Woodside, 2017). In the last decades, we have seen a shift in the luxury consumption, from the excellence of handcrafted goods, an essential element of real luxury, to the massification of goods that maintain their logos and conspicuous function that confers social status (Amaldoss & Jain, 2005; Vigneron & Johnson, 1999).

This chapter aims to understand managers’ perceptions on the motivations of the consumers to acquire luxury wines, a topic that, according to Kim and Johnson (2015), deserves further deepening. Besides the existing studies in the literature aimed to understand the evolution of the concept of luxury in the wine sector, from the consumers’ point of view (Boncinelli, Dominici, Gerini, & Marone, 2019; Bruwer, Saliba, & Miller, 2011; Wolf et al., 2016), or from the producer/brand (Thach, Charters, & Cogan-Marie, 2018), accordingly to Bruwer et al. (2011), few articles aimed to examine the contrast between what the brands have sought to offer to the consumers and what the consumers actually search for in a luxury wine. Through in-depth interviews, information was collected from a group of wine brand managers and producers on their opinions and knowledge about the real motivations of wine consumers, particularly luxury wine consumers. Such information was subsequently compared with the results published in academic literature regarding the behaviour of wine brand consumers. The study also aimed at analysing the Portuguese world of producing companies and private brands in this market and elaborate a set of management recommendations in order to reach a standard for domestic luxury wine in line with the international panorama.

Key Terms in this Chapter

Social Status: Relative rank that an individual holds in a social hierarchy based upon prestige.

Massification: The practice of making luxury products available to the mass market.

Hedonism: The devotion to pleasure as a way of life.

Vintage: The year and place in which high quality wine was produced.

Connoisseur: An expert judge in matters of taste.

Authenticity: Made in the traditional way, or in a way that truly resembles an original.

Democratization: The action of making something accessible to everyone.

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