According to the study “Eco-Labeling Strategies: The Eco-Premium Puzzle in the Wine Industry,” carried out by the American Association of Wine Economists, based on more than 13,000 wine bottles from California that are sold in the US market, the wines with the best prices are those that perform sustainability actions though they not specified them in their labels.
“Eco-labels provide information about the environmental characteristics of a product. Eco-labels are effective if consumers are willing to pay a price premium for green products which are costlier to produce.” However, “in the wine industry, many wineries obtain eco-certification but do not label it on their wine bottle,” points out the study.
“Also, eco-labels are relatively new and consumers do not necessarily understand the actual meaning behind the different labels. More specifically, some consumers are still confused about the difference between wine made out of organically grown grapes and organic wine,” states the American Association of Wine Economists.
“Yet eco-certification does not need to be directly associated with consumers’ recognition of the label, as we demonstrate with the investigation of other potential benefits associated with certification. We theorize that certification can provide reputation benefits via clubs or trade associations. We also suspect that eco-certification can lead to a higher wine quality and provided a second set of regressions of wine characteristics on the scores attributed by the Wine Spectator. The results indicate that wine quality increases with eco-certification. The winery might also gain reputation and publicity,” maintains the report.
In order to see the full study, please click here: http://www.wine-economics.org/workingpapers/AAWE_WP13.pdf