Consumers’ willingness to pay for local muscadine wine

Abstract

PurposeThis paper aims to identify factors influencing the likelihood of consumers trying muscadine wines and among those who have tried them, willingness to pay (WTP) for an in-state produced muscadine wine.Design/methodology/approachThe study uses a 2015 survey of wine consumers residing in Tennessee (TN). The survey presented respondents with a referendum choice experiment between a ‘base’ wine (represented by a North Carolina (NC) muscadine wine) and a TN muscadine wine. The study uses probit regressions to estimate factors influencing the probability of trying muscadine, and those influencing TN muscadine wine choice. Estimates of WTP for TN muscadine wine are derived from the model coefficients.FindingsOlder age, living in non-metro households being a weekly wine consumer, preferring red wines, and having visited a winery in the past year positively influence trying muscadines. Older age, liking muscadines and lower product price positively influence TN muscadine choice. Greater importance of wines being local and premiums paid for local foods have positive influences on trying muscadines and WTP for TN muscadine wine. A premium WTP for a TN muscadine over a NC muscadine exists among TN consumers. Among the most influential reasons why consumers chose the TN muscadine were beliefs that purchasing local wines helps local wine grape growers and local economies.Originality/valueThis study provides the muscadine wine industry with estimates of WTP for locally produced muscadines and demonstrates that attitudes toward local wines and premium paid for local foods positively influence trying muscadine wine and WTP for locally produced muscadine.