Identifying the willingness to pay for eco-certified wine by South African consumers: a comparison of biodynamic, fair trade and sustainably produced wines

Abstract

As eco-certified wines are being produced in increasing quantities and varieties, so are the definitions and the labels that accompany them. This has resulted in confusion with regard to what type of eco-certified wines customers prefer and what prices they are prepared to pay for such wines. The purpose of the research is to provide clarity regarding consumer knowledge about eco-certified wines and their preferences for each category as expressed by their willingness to pay (WTP). Specifically, the goal of the research was to identify the willingness to pay for South African eco-certified wine with a focus on three labels: biodynamic, fair trade and sustainable. The methodology used by the study was to identify the willingness to pay for the wines by using contingency valuation modelling. A survey was administered using the Qualtrics platform. It consisted of three sections: the first set of questions included questions about purchasing behaviour and important considerations when buying wine. The second set of questions collected perspectives and opinions about the multiple wine certifications discussed in this article and the third set of questions collected demographic data. The research focused on South African consumers and consisted of 267 respondents. Three WTP models were run separately for biodynamic, fair trade and sustainable wines. The study found that younger individuals with higher incomes, higher levels of education, previous eco-labelled product purchases and better knowledge of eco-certified wines have a positive impact on the WTP. The only exception seems to be the in case of biodynamic wines where previous knowledge of eco-certification has a negative effect on the WTP. The research outcomes provide guidelines to producers, retailers and restaurateurs about their output, marketing and sales
efforts towards the ever-growing consumer demand for such wines.