Place‐based marketing strategies, brand equity and vineyard valuation

Abstract

Many firms, wine producers among them, have successfully communicated the quality of their products to the market by emphasizing the geographic origin, or location of production of critical ingredient(s) found in the product. The purpose of this article is to: introduce the concept of a “place‐based” marketing strategy, i.e. a marketing strategy that identifies a consumer product with a specific geographic area; explain why it is essential to the wine business; and, why it may be superior to other types of marketing strategies for certain types of agricultural products. Additionally, traditional valuation techniques applied to agricultural land typically assume that agricultural goods are undifferentiable commodities. With the growing trend toward the production of “place‐based” agricultural products, the traditional valuation methods omit an important variable – the potential for the geographical source to help develop a product‘s brand equity. This paper also discusses land valuation techniques and applies the concept of products of place to the trend among Californian wine growers to produce wines with vineyard designations.