Competing in the US Wine Market: Australian Imports and Tasting Scores

Abstract

American wineries have taken marketing steps toward attracting consumers. They employ tasting scores to augment and solidify market share. According to Oster (1999) and Porter (1985), competitive advantage comes from either cost advantages or product differentiation. American wineries use tasting scores they receive from experts as the basis for product differentiation and raising prices. To achieve competitive advantage, the product must be seen as important and an improvement in the market, while simultaneously lacking imitation. This article looks at how tasting scores given by wine experts may affect American firms' competitive advantage, barring entry by importing rivals, such as Australian firms. If these tasting scores provide product importance and improvements, while delivering a product that lacks imitation, competitive advantage may result. If importers to the US realise this, these firms can undermine American advantages, increase competition, and gain market share through their own competitive advantages.