Redefining Value

The relationship between value and price is at best uncertain when it comes to wine.

The past proliferation of so-called half price offers, bogofs and multibuys obscures objective value to such an extent that recent research suggests that although shoppers may feel an overall “glow” of good value having visited a multiple grocer, few can tell you exactly how much they paid for their wine. Furthermore, recent on-trade research highlighted the shaky relationship between price and value by proving that if the same wine in the same outlet was priced at three different levels, consumers bought more of it at the highest price.

So, what are we to make of the oft repeated notion that value means economy and that economy is good for the consumer? Is this the same consumer that does not know what true value is? The same consumer that would prefer to pay more rather than less for the same wine in a restaurant? The same consumer whose notion of value in wine has been so manipulated and mangled by commoditisation that it is no wonder that so many people feel disenchanted and confused by the wine trade?

It doesn’t have to be this way. Even during the depths of the recession, businesses that have been built upon foundations of trust, quality and real value have prospered. Is it now time for a more general reassessment of what value means when it comes to wine? Does the wine industry need to re-set its values?

I believe that it does. Let’s start by breaking the misguided ideology that value means economy. As anyone in the trade knows, the heavy burden of taxation means that wine is very rarely good value below £5 and there is a better correlation between price and quality between £7 and £15 than at any other price points. Could we therefore not focus our “value” propositions a little more ambitiously?

Then perhaps we could move away from the notion that cheap is good for the consumer. Most consumers would be horrified to know that much wine being sold as “value” is being bought at a price that is below a sustainable level for the grower. Whilst minimum pricing legislation now seems unavoidable for some parts of the country, perhaps the wider issue of the long term viability of many wine growing regions could be helped within the UK market by a charter to not buy below agreed sustainable prices and work hard to market the true value of fairness.

A tough challenge to meet perhaps but unless some redefining of what determines true value takes place no end of innovations and customer targeting is going to help us.