Learning and decision making in marketing planning: a study of New Zealand vineyards

Abstract

Purpose – The purpose of this paper is to investigate how decision making and learning are related to marketing planning among owner/managers with lifestyle in comparison to growth-oriented objectives in the New Zealand wine industry. Design/methodology/approach – The study reports on 12 interviews with owner/managers of New Zealand vineyards. The vineyards were small to medium sized and independently owned to avoid bias from parent company decision making within larger scale corporate wine producers. Findings – Different degrees of causation and effectuation-based decision making were found to exist among owner/managers starting from the nascent stage in their respective marketing planning processes. Learning to different degrees was evident in order to remain competitive in a climate of uncertainty and not least of which due to problematic exchange rates. An important issue influencing decision making was whether owner/managers were running the vineyard to maintain a lifestyle or a growth strategy; an issue affecting perceptions of risks and rewards. Originality/value – The originality of the study is that it employs an effectuation lens in respect of the marketing planning process; specifically, decision making among owner/managers with differing objectives, experience and perceptions of risks and rewards.

Risks/rewards and an evolving business model

“…Nevertheless, the existing literature involving business models for the most part seemingly assumes owner-managers have growth and/or financially-oriented objectives; however, it is understood that lifestyle-oriented objectives, such as to achieve a work/life balance, are important to some owner-managers (Milman and Martin, 2007;McGuire et al, 2012;Pearson, et al, 2014;Crick and Crick, 2015;Mahto and Khanin, 2015). The second conclusion is that risks/rewards considerations are likely to vary for owner-managers with lifestyle objectives and business models need to account for social considerations to achieve these objectives.…”

“…Smaller-sized firms, including those where the self-employed owners have lifestyleoriented objectives (Crick and Crick, 2015) tend to be constrained by resources such as funds and knowhow in comparison to their larger counterparts (Hills and LaForge, 1992;Morris et al, 2002). However, the resource issue by itself cannot fully explain business closures, like the respective business climate and decisions taken (Keasey and Watson, 1987;Liao, Welsch and Moutray, 2008).…”

Studying coopetition in a wine industry context: directions for future research

“…The global wine industry is divided into two over-arching groups: Old World countries (i.e., established wine markets, such as: France, Italy, and Spain), and New World countries (i.e., newer entrants to the wine sector, such as: Australia, South Africa, and New Zealand) (Crick and Crick, 2015). Furthermore, some studies have studied specific regions of certain wineproducing countries; for example, Telfer (2001) explored the strategic alliances of vineyards and wineries in Canada's Niagara region, finding that cooperation with vertical (e.g., supply chain partners) and horizontal (e.g., competitors) partners can improve firms' wine tourism offerings.…”

“…Thus, by being able to access organisations (namely, vineyards and wineries), the wine sector allows management researchers to identify participants (e.g., interviewees) to examine a theoretical issue, in which they are investigating. That said, it is acknowledged that other industries have sampling frames to identify firms, but the wine industry nevertheless has been known to help scholars identify and sample companies using various methodologies (Crick and Crick, 2015). The interplay between cooperation and competition in the wine industry is expanded upon in the following section, with respect of the value of studying coopetition in a wine industry context.…”

“…As such, whilst cooperation (across various levels) may indeed occur, vineyards and wineries are also in strong competition. Crick and Crick (2015) described that in the New Zealand wine industry, the domestic market is in a state of over-supply, in which the domestic demand for wine is significantly less than the supply of grapes. That is, Crick and Crick (2015) found that the owner-managers of New Zealand vineyards and wineries have adopted various types of innovative business strategies to differentiate their business models from those of competitors (e.g., through internationalisation, and collaborating with vertical channel partners).…”