Assessing brand equity in the luxury wine market by exploiting tastemaker scores
| DOI | https://doi.org/10.1108/JPBM-06-2016-1214 |
| Published date | 21 August 2017 |
| Pages | 447-452 |
| Date | 21 August 2017 |
| Author | Amanda J. Blair,Christina Atanasova,Leyland Pitt,Anthony Chan,Åsa Wallstrom |
| Subject Matter | Marketing,Product management,Brand management/equity |
Assessing brand equity in the luxury wine
market by exploiting tastemaker scores
Amanda J. Blair
School of Industrial Economics and Management, Kungliga Tekniska Hogskolan, Stockholm, Sweden
Christina Atanasova, Leyland Pitt and Anthony Chan
Beedie School of Business, Simon Fraser University, Burnaby, Canada, and
Åsa Wallstrom
Department of Industrial Marketing, Luleå University of Technology, Luleå, Sweden
Abstract
Purpose – Calculating brand equity, the price differential that a branded product is able to charge compared to an unbranded equivalent, often
suffers from a lack of a means to truly determine equivalence. Luxury wines have the benefit of an established measure of equivalency – the Parker
score. Robert Parker’s influence as a tastemaker provides a point of comparison across brands. This study looks at brand equity of Bordeaux classified
growth wines considering château brands, growths and vintages to illustrate the intangible value for the consumer.
Design/methodology/approach – Using price and wine-specific data from Wine-Searcher.com, an online database and search engine, an initial
sample of 393 wines with Parker scores ranging from 72 to 100 is presented. A subset of perfect wines, with 100-point Parker scores, is also reviewed
focusing on the great vintage of 2009.
Findings – The results indicate that brand equity in the luxury wine market exists. Not only is this true for the brand of a specific château, but there
is also equity associated with the vintage and the growth.
Practical implications – This offers practical implications for brand managers in positioning their wines.
Originality/value – An analysis of luxury wines supports the financial perspective on brand equity, especially when there is a viable means of
determining equivalence, such as the Parker score.
Keywords Luxury branding, Financial brand equity, Marketing strategy, Wine marketing
Paper type Research paper
What’s in a name? Perspectives on brand equity
What’s in a name? Or more precisely, what’s in a brand name?
The general public, and marketing scholars in particular, have
long been obsessed with brands: what they mean to consumers
and what they mean to firms (Berthon et al., 1999). The
branding consultancy Interbrand’s annual survey and
compilation of the world’s most valuable brands (e.g. http://
interbrand.com/newsroom/interbrands-15th-annual-best-global-
brands-report/) is eagerly awaited each year, and widely reported
on by the popular business media. At the heart of much of this
fascination is what a brand is worth, or its brand equity. For
example, in 2014 Interbrand ranked Apple as the world’s most
valuable brand at US$118.9 bn and Google second at
US$107.43 bn.
In simple terms, brand equity refers to the value of a brand.
While Interbrand’s focus on brand equity is from a financial
viewpoint, the construct has been considered from two
perspectives in the marketing literature. First, from a
consumer behavior stance, brand equity has to do with the
consumer’s awareness of a brand’s features and associations,
which in turn drive attribute perceptions (Keller, 2012).
Second, and the approach adopted here, a simple financial
perspective on brand equity is that it is the value premium that
a company realizes from a product with a recognizable name
as compared to its generic equivalent (Investopedia, 2016). A
rudimentary approach to this type of measurement has been to
compare the price of a no-name or private label product to an
equivalent branded product. Any positive difference in price
would then be because of the brand. Fundamentally, the firm
holding that brand equity can charge premiums over and
beyond mere physical or performance-related superiority
(Aaker, 1996;Baltas and Freeman, 2001).
More specifically, the Interbrand approach takes a
brand’s value to be a product of two quantities, namely the
annual “net” after tax profits, adjusted to exclude the
earnings for an equivalent unbranded product, averaged
over time and a “multiple” (or discount rate), reflecting the
brand’s strength. This multiple takes the following factors
into account:
●Leadership: the brand’s ability to influence the market.
●Stability: the brand’s ability to maintain a consumer
franchise.
The current issue and full text archive of this journal is available on
Emerald Insight at: www.emeraldinsight.com/1061-0421.htm
Journal of Product & Brand Management
26/5 (2017) 447–452
© Emerald Publishing Limited [ISSN 1061-0421]
[DOI 10.1108/JPBM-06-2016-1214]
Received 15 June 2016
Revised 3 February 2017
Accepted 6 February 2017
447
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