Prosecco is not a wine, it's a lifestyle

And that's what people want to pay for. This has implications for everyone when deciding on the price of their wine.

It’s time for a new post from the hugely popular “Wine Marketing Masterclass” - an MBA-style course in wine marketing for people in the business, doing exams, or fascinated in how the wine business works. We’re currently in “Price” in the “4 P’s” of marketing. And soon we’ll move onto “Promotion” or Communications.

I’m a demon I know… I tease you with content and then put the rest behind a paywall. But, there are weekly insights that will transform your business/career/winery here for just 1/300th of the cost of doing an onsite wine MBA

Does your home run on love, laughter, and prosecco?

If it does I have a spoon to sell you. Along with about thirty other people on Etsy. As well as pillows, hats, mugs, T shirts, tote bags (obvs) and even a doormat.

Prosecco is not a wine. It’s a lifestyle. A seductive one too if all your friends are prosecco lovers. Prosecco is a cultural vibe. A movement. An identity. As Tupac Shakur would have been better saying, “I didn’t choose the prosecco life, the prosecco life chose me”.

A lot of people in wine are bemused by the prices “normal” people pay for a bottle of prosecco. Insisting that there’s “better value” elsewhere. That’s because we… well, they… have a flawed understanding of what makes up the price of a bottle of wine. My consultancy clients - and paid subscribers - are different. They know where the value lies in the prosecco life. And other places too.

Vi­no­no­mics vs Va­lue 

If you have a men­tal mod­el of the price of a bottle of wine is quite pos­sibly looks a bit like this:

This is the long-run­ning Vino­nom­ics graph­ic pro­duced by Bibendum in the UK. It’s a UK ex­ample, but you could cre­ate some­thing just the same for any mar­ket in the world. The in­fograph­ic is pro­duced every year to il­lus­trate the dis­pro­por­tionate im­pact that gov­ern­ment taxes and al­co­hol du­ties have on cheap­er wines. It shows how Bri­tain’s high level of al­co­hol duty - as well as the cost of bottles, shipping, and so on - are fixed costs. Meaning if you spend a little more on each bottle, you get a lot more “wine” value in re­turn.

It breaks down the com­pon­ent parts of a bottle of wine into its vari­ous costs.

• The wine it­self

• The re­tail­er mar­gins

• The dis­trib­ut­or mar­gins

• Al­co­hol Duty

• Tax­es like VAT

• Dry goods

• Ship­ping

Add all these to­geth­er… and hey presto, you have a price. 

And many people price their wine in terms like this. And they’re not be wrong. But they’re not right either.

The mod­el isn’t wrong. That’s how we have to price wine. At least to un­der­stand how we cover our costs. But it’s not the whole pic­ture. For that, we need an­oth­er pic­ture.

Ana And­jel­ic is the au­thor of “The Busi­ness of As­pi­ra­tion” and has a doc­tor­ate in So­ci­ol­o­gy. She’s also a Glob­al Chief Brand Of­fi­cer and has an excellent Substack. She has this graph:

The graph­ shows the dif­fer­ent ways we as­sign value to some­thing. But also how value is noth­ing to do with the ac­cu­mu­lated costs we saw in the Vino­nom­ics graph. Value is the things people want to pay for. 

It’s a model we can adapt for wine. And in turn, maximise the price we can charge for wine. I use it every day with clients. And it works.