Consumer Valuation of Environmentally Friendly Production Practices in Wines, considering Asymmetric Information and Sensory Effects

Abstract

Agricultural producers and food marketers are increasingly responding to environmentally friendly cues from consumers, even though privately appropriated values associated with a range of food products commonly rank above their public‐good counterparts. Wine can be considered an ideal product to examine these issues given consumers’ highly subjective sensory preferences towards wine, and a winegrape production process that is relatively intensive in the use of chemical inputs for the control of disease and infection. Semi‐dry Riesling wines made from field research trials following environmentally friendly canopy management practices were utilised in a lab experiment to better understand preferences for environmental attributes in wine. A combined sensory and monetary evaluation framework explicitly considered asymmetric order effects. Empirical results revealed that sensory effects dominate extrinsic environmental attributes. Once consumer willingness to pay (WTP) was conditioned on a wine’s sensory attributes, the addition of environmentally friendly information did not affect their WTP; however, adding sensory information significantly influenced WTP initially based only on environmental attributes. The results confirm the idea that promoting environmentally friendly winegrape production practices would increase demand and lead to higher premiums for the products, but are only sustainable if consumers’ sensory expectations are met on quality.

Product Differentiation with Credence Attributes and Private Labels: The Case of Whitefish in UK Supermarkets

“…Over time, this will however depend on consumers making repeat purchases and that sufficient premiums are maintained. In keeping with Schmit et al (2012) it seems reasonable to assume that consumers' sensory evaluation of the products will be important implying that those pursuing a line-caught differentiation strategy should certainly strive to ensure the high quality of the product as documented by Rotabakk et al (2011). That the market seems to prefer line-caught cod and haddock of high quality should also be of interest for governments striving to optimise the value of its fish stocks.…”

Millennial Generation and Environmental Sustainability: The Role of Social Media in the Consumer Purchasing Behavior for Wine

“…It considers that no additives have been used in the winemaking process and also the reduction of agrochemical use, pesticide and fertilizer, particularly nitrogenous fertilizers, in the vineyard [18,50,51]. Also, traceability among all the stages has to be assured, and good sensory expectations of the product need to be satisfied if the wine is to be perceived as sustainable [23,52]. In a study Forbes et al [6] revealed that New Zealand consumers think that sustainable practices would improve the quality of the wine.…”

“…Although age is a control variable generally used in the consumer behavior studies [52,59], we decided not to include it because we are already analyzing two sub-samples characterized by different ages: millennials (18-35 years) and non-millennials (36-88 years).…”

An overview of the biodynamic wine sector

“…31,[40][41][42][43][44][45][46][47] While some studies analyzed consumers' preferences toward environmentally friendly wine products, considering carbon neutral, organic and further eco-friendly claims, only a few of them describe in detail consumers' preferences toward biodynamic wine. 2,7,[48][49][50][51][52][53][54] Furthermore, although results from a number of studies reveal that most consumers are willing to pay a higher price for sustainable wines and a few estimated that environmentally friendly ones receive a very limited premium compared to conventional wines, to our best knowledge none describe the willingness to pay for biodynamic wines.…”