The price is right
Today, on the final day of the London International Wine Fair, researchers from Wine Intelligence revealed their recent findings, suggesting that higher price points can actually lead to an increase in on-trade sales.
An experiment was carried out in which three groups of consumers were shown three wine lists – identical in every way but price – for three hypothetical restaurants. The first group was given a version of the list with a 66% margin applied to the wines, the second received a list with a £5 or £10 cash margin, and the third group was given a list with a 72% mark-up on all wines. The same Pinot Grigio on the list could therefore be priced at £10.20, £12.50 or £15.70. Based on the consumer response, it was projected that the most expensive of these imaginary eateries would have made a profit £46,000 higher than the others over the course of a year; as customers apparently sought reassurance on the wine's quality from the more inflated list price.
It isn’t all cynicism and capitalism though, as the most important qualities in boosting wine sales were found to be good product visibility, the availability of wine lists, and of course good old fashioned staff knowledge.
News item from Imbibe.com, 19-05-2011