Term 2: Group Assignment

Course: Crafting Dissertation Workshop

Faculty: Prof. Varsha Jain

By:
Aditya Tripathi (20210403003)
Archit Thakur (20210403008)
Neelav Roy Sarkar (20210403020)
An Integrated Model for Consumption of Luxury
Wines
Introduction
Luxury is classically defined as “great comfort, especially as provided by expensive and
beautiful things”. Another definition is “something that gives you a lot of pleasure but
cannot be done often” (Cambridge Dictionary). The possession of an item of luxury is
associated with affluence and perception of refined taste. In fact, in modern economics,
a luxury good or service is one whose demand rises with the rise in income levels of
consumers.
As an alcoholic beverage, wine is widely associated with an evolved palate and refined
taste and can be considered the perfect ‘luxury good’. In the global retail market, wines
are available starting from $15 to upwards of $500 ("How much does a good bottle of
wine cost?", 2022)¹. The market for high-end, ultra-premium wines, which fit the
categorical definition of ‘luxury wines’, is highly fragmented. Certain legacy brands, such
as Châteaux Lafite-Rothschild still command premium prices. The consumption
patterns, however, are changing. The average amount that a US consumer spent on
expensive wine has reduced significantly due to long -term economic slowdown in
developed economies. These markets are giving way to new consumers from emerging
economies in China and the rest of Asia. China is now the largest importer of wines
from the Bordeaux region, which is the traditional wine capital of the world.

It is widely known and accepted that new-age consumers prefer spending on expensive
experiences rather than luxurious material goods. This is true in the context of luxury
wine consumption as well. Wines are not purchased with a desire to fulfil tangible
requirements, but rather as a sensory experience (Alistair Williams and Glyn Atwal,
2013). This opens up the possibilities of creating a model for the consumption of luxury
wines on the basis of the layer of experiential fulfilment around the same. Exploring this
aspect would help uncover insights involving motivator and consumption patterns and
determine gaps in the current understanding of wine consumption in general.

Literature review

1. THIS IS MY PERFECT MATCH! UNDERSTANDING LUXURY WINE

CONSUMPTION

This paper dwells into areas of consumer perception, what motivates the average
consumer and characteristics in the luxury consumption segment. This is done
through the lens of Luxury wine. It defines broad areas for study which include
motivators, methods and context of consumption of luxury wines. It attempts to
understand the dimensions of luxury wine by developing a conceptual framework
on consumer perception. It talks about how a broader definition and
 segmentation will allow managers in making strategic marketing decisions for
their luxury wines.²

2. A conceptualization of the perceptions and motivators that drive luxury wine

consumption

This paper differentiates the consumption pattern between other luxury product
categories and luxury wine. It talks about how there is a varied perception when it
comes to defining what a luxury wine really is. It briefly explores the possibility of
wine as an investment. It develops a framework based on consumer motivation
and perception intended to be valued across a range of cultural and situational
settings. It proposes a framework incorporating self-congruency theory to
comprehend the dynamic of luxury wine consumption. It furthermore debates that
consumption is based on the self-identity of the consumer and a group’s
perceived norms. It tries to strike a balance between conforming to current norms
and the importance of one’s choice which requires a lot of knowledge specially in
the luxury wine segment.³

3. The Luxury Landscape in India: Consequences for the Wine Sector

The paper aims to understand the current scenario of the luxury sector in a
developing nation like India, and further zeroes in on its consequences for luxury
wines in particular. The returns and rewards associated with success in a
developing nation is multifold. The intel gained from this research is crucial to
understand how various factors come into play into making a luxury brand
effective in the primary emerging markets/economies (BRICS Nations).

Emerging markets are constantly changing, and fresh market knowledge will be
essential in dealing with complicated difficulties and achieving corporate
success.⁴

4. An Exploration of the Luxury Wine Trade

This paper delves precisely into the domain of positioning of luxury wine brands,
it furthermore explores the evolution of the strategy of these brands and the
obstacles and opportunities of functioning in an emerging market. The gap it tries
to fill is in the scope of the positioning, consumer perception and interpretation
and the marketing of these luxury wines, which have a robust public profile. The
paper is bifurcated into two segments: the first one dealing with the results and
responses from interviews with luxury wine consumers and the latter dealing with
the other end of the spectrum by analyzing interviews with leading wine
 producers. These results reveal how the consumer perception and interpretation
of these luxury brands centers around several product and marketing features.⁵

5. Luxury wine brands as gifts: ontological and aesthetic perspectives

This research paper can be differentiated on the grounds that it focuses on the
act of consumption of luxury wines from a “gift giving” perspective and not
individual purchase and consumption. From a conceptual standpoint, the
objective of this article is to examine the challenges of luxury gift giving and the
giving of premium wines as presents. The paper looks at Berthon et Al’s “OA”
(which stands for Aesthetic and Ontology) paradigm, which allows for the
integration of many authors' conceptualizations in the field of luxury branding.

The four modes outlined in Berthon et Al's model may be employed as a typology
of luxury wines, according to the research, from both a gift-giving and a
gift-receiving standpoint. By identifying where both the donor and the receiver are
located on the suggested matrix, luxury wine marketers may successfully target
wine gift givers using the proposed typology.⁶

References
1. How much does a good bottle of wine cost?. Vivino. (2022). Retrieved 1 January
2022, from
https://www.vivino.com/wine-news/how-much-does-a-good-bottle-of-wine-cost.
2. Wolf, H., & Morrish, S. (2022). THIS IS MY PERFECT MATCH!
UNDERSTANDING LUXURY WINE CONSUMPTION [Ebook]. Retrieved 1
January 2022, from
https://www.academia.edu/download/44644909/This_is_my_perfect_match_2016
AWBR_Conference.pdf.
3. Atwal, G., & Bryson, D. (2014). Luxury brands in emerging markets (pp. 85-95).
Palgrave Macmillan.
4. Beverland, M. (2004). An Exploration of the Luxury Wine Trade [Ebook].
International Journal of Wine Marketing. Retrieved 2 January 2022, from
https://www.emerald.com/insight/content/doi/10.1108/eb008776/full/html.
5. Reyneke, M., Berthon, P., Pitt, L., & Parent, M. (2011). Luxury wine brands as
gifts: ontological and aesthetic perspectives [Ebook]. International Journal of
Wine Business Research. Retrieved 2 January 2022, from
http://www.emeraldinsight.com/1751-1062.htm.