Reputation Tapping: A Strategic Advantage for French Winemakers

Reputation is a complex phenomenon that develops over relatively long periods of time. As the literature review indicates, the reputation of French wine-growing regions has been shaped by various historical and political factors that have.

In this section, we will show that leveraging reputation—generally viewed as an illegitimate practice that could harm French winemakers—is also a factor contributing to the popularity and legitimacy of French wine regions.

After establishing the importance of cognitive presence in building a competitive brand, this section describes how reputation-tapping practices contribute to the popularity of French wine regions. Finally, this analysis will show that, despite the visibility gained through reputation-tapping, certain French wine regions would be wise to monitor this phenomenon closely in order to protect the commercial potential of their appellations.

1) The Importance of Mental Readiness

"The decision to purchase a branded product in a competitive market is influenced by countless variables, but demand itself depends on two combined factors: people's awareness of the brands and their ability to actually purchase the product."

Mental availability is created and maintained through promotion and marketing, while physical availability is determined by the company’s distribution network.
French wine regions can already count on significant cognitive presence in the international market, thanks to the advantage of being the first regions to export consistently high-quality wines internationally, beginning in the early Middle Ages. In this context, mental availability was a consequence of the increased physical availability of wines from these regions in other countries.

Today, French wines enjoy such high consumer demand that it has surpassed the actual supply of French wines. Demand for wines from prestigious French regions exceeds supply, and winemakers in these regions therefore have greater freedom to raise their prices (the best example is Champagne, which accounts for only 4% of French wine production but represents over 27% of the value of French wine sales!).

Although French wine has long enjoyed a strong global brand presence, this is not guaranteed to last forever. This is especially true today, as more and more countries with diverse regional varieties begin to produce high-quality wines. Consequently, the brand awareness of prestigious French appellations must be strengthened in the marketplace, and sometimes promotion alone is not enough. “No marketing activity, including innovation, should be considered an end in itself; its purpose is to maintain or improve physical and mental availability” (How Brands Grow – Byron Sharp, 2010).

Given the importance of mental availability, it is easy to understand the role that reputation tapping plays in the sustainability of French wine regions:
When an American wine is linked to a French region as a stylistic reference, the phenomenon of reputation tapping ensures that French wine regions remain virtually constantly present in the minds of the exposed population.

2) The effects of increased mental availability on French wine-growing regions

The exposure that French wine regions gain from leveraging their reputation has numerous potential commercial applications. Indeed, rather than seeking to ban these practices, French wine regions could capitalize on their effects to further diversify their operations: First, as mentioned earlier, mental availability is a key determinant of demand. The strength of French appellations lies in the brand image that has developed around their geographical indications. Demand for French wines is therefore constantly increasing, and French winemakers often turn to exporting rather than local distribution, as it is a good way to sell large volumes at a good price. The visibility of French appellations in the U.S. is more often the result of “brand tapping” practices, as seen in the BevMo! case study, than the result of promotional campaigns initiated in France.

In this regard, “brand recognition” plays a key role in French exports to the United States: by keeping French appellations in consumers’ minds as benchmarks of style, sales of wines from these regions are naturally boosted. Furthermore, since French regions are perceived as a benchmark for winemaking expertise, French exports are far more valuable than those of other major wine-producing countries:

In 2016, France alone accounted for more than 28% of global wine exports by value, ranking first on its own—exactly 9 percentage points ahead of Italy. (Wine Trade Exports report – WTEx)

Nevertheless, in that same year, French wine exports ranked third in terms of volume at 14.1 million hectoliters, behind Italy (20.6 million hectoliters) and Spain (22.9 million hectoliters). (The world’s leading wine exporting countries – Statistica)
This ability to create value is a direct consequence of the scarcity effect, driven by a significant gap between strong demand and controlled sales volumes.
In addition to promotingthe export of French wines, the increased brand awareness of French regions achieved through reputation tapping has another positive effect for French wine-growing regions, which remain significantly underutilized today:

“Wine tourism is a term that refers to tourist activities related to the world of wine. Despite the rich heritage that French regions have in the history of viticulture, wine tourism remains underdeveloped in many prestigious wine-growing regions. With the exception of Champagne, the Saint-Emilion sub-appellation in Bordeaux (the one closest to the city of Bordeaux), and the grand estates in Provence, many wine-growing regions in France still lack the necessary infrastructure to accommodate visitors.
Even though French appellations often function as brands in the international wine market, they are first and foremost geographical indications of origin. Thus, reputation tapping does not merely promote the region’s wine but the region’s very name.
Following the logic presented by Byron Sharp, wine tourism should be much easier to develop for French regions that are well-known from a marketing perspective.
French wine tourism is not underdeveloped due to a lack of demand, but rather due to a lack of supply: hospitality facilities are still too scarce in these regions. Nevertheless, the potential is there, and if the necessary investments are made, wine tourism could become a key activity for certain regions (as demonstrated by the success story of the Cité du Vin, which recently opened in Bordeaux).

3) Are French winemakers right to denounce attacks on their reputation?

Positive or Negative Effects: Given the significant impact that reputation hijacking can have on the reputation of French appellations, it is important to assess the positive and negative effects for each appellation before condemning reputation hijacking as a harmful practice. Given that the main positive effect of reputation exploitation is the exposure of appellation names and the development of their brand awareness worldwide, this external effect will not benefit all French appellations equally:
Champagne and Bordeaux are two well-organized appellations that can rely on powerful regulatory bodies (the CIVC and the CIVB, respectively). Their names are likely the most well-known appellations in the world, and major marketing campaigns are rolled out globally to maintain this popularity.
In this context, it is legitimate for these two regions to denounce reputation exploitation as a harmful practice: Their global brand presence is managed internally; their international distribution network, managed by major French exporters or foreign importers, already ensures significant physical availability; and their wine tourism facilities are likely the most developed in the country (even if progress can still be made in this sector). Thus, the positive effects of reputation tapping (increased cognitive presence abroad, stimulation of foreign demand, indirect promotion of wine tourism) do not benefit Champagne and Bordeaux. For these appellations, reputation tapping practices present more disadvantages than advantages (see the Gruet case study).
Nevertheless, it would be interesting to measure the impact of reputation tapping on the scarcity effect of French wines, a consequence of the imbalance between strong demand and limited supply. Even the big names in Bordeaux and Champagne could benefit from this notoriety, a determining factor in a key condition of their value creation model. This situation does not apply to all French appellations. Smaller French regions, such as the Rhône, Languedoc, and Alsace, which have a much lower profile outside France, could benefit from more positive effects than their larger neighbors mentioned above.

It is reputation tapping that provides them:

Wider international visibility
Highlighting these regions as style benchmarks, thereby establishing their legitimacy
Highlighting geographic locations that would facilitate future wine tourism activities.
Furthermore, showcasing a variety of French appellations—not just the best-known ones—would have a positive impact on France itself: The French portfolio of the most renowned wine regions would be strengthened, featuring a wide variety of styles, terroirs, and expertise.

Charles Bonnay

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