The few studies conducted have
shown that more than 50% of consumers
read back labels and find
them important in their selection.1
Existing research on back label content
is limited mainly to small studies
of narrow sets of attributes.
Ten years ago, the Australia & New
Zealand Wine Industry Journal published
a study showing that different
back label statements created different
perceptions of a wine’s quality.5
Beyond these, the other studies only
investigated one or two attributes,
usually in the context of front and
back labels. None of these studies
were able to quantify the importance
of different types of back label statements
or test them against a consumer’s
actual wine choice, especially
with different prices.
Method
We developed an experiment to
test 10 different back label statements
in an incomplete block design along
with four different prices. A sample
of 331 wine consumers was recruited
in May 2008 for a
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wine tasting research
project in North Sydney, and
were given the back label experiment
as a part of this project. The sociodemographics
of the sample were
similar to those of the general Australian
wine consumer population,
when compared with the Roy Morgan
single-source data of over 50,000
Australian consumers.
The respondents were given a
range of socio-demographic and
wine consumption questions along
with the experiment. They were
asked to consider purchasing a wine
for a special occasion, which represents
approximately 25% of the purchase
occasions in Australia,2 and
given a printed page with four different
back labels and prices for a
Shiraz wine.
The statements were taken from
previous research and from common
back label text. We added one on ingredients,
since this is under consideration
in both Australia and the U.S.
Each back label had between 2 and
10 statements. Respondents chose
the wine they would be most likely
to buy from 16 different sets of four
labels, which allowed us to compute
the effect of each of the statements
and price on the probability
of choice. Respondents were asked,
“Would you really purchase your
choice?” to test the realism of the experiment.
Eighty-seven percent said
they would buy their choice.
Results
A latent class choice model was
used to simultaneously create clusters
and utilities for each statement
in each cluster. The best solution had
the 331 respondents grouped into
five different clusters, with strong
differences in the importance of each
of the statements and price across
the clusters (Table II). The final column
in Table II shows the average
value for the sample.
Overall, price accounts for 66% of
the importance, with the back label attributes
accounting for the remaining
34%. Listing the “ingredients” had the
highest value — though
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with a negative
influence on predicted choice
— followed by history, food pairing,
and the elaborate (or longer version)
description of the wine’s taste.
The clusters differ substantially in
the importance of price and back label
statements. Ordered from 1 to 5,
the clusters with lower numbers preferred
lower prices and those with
higher numbers preferred medium
and higher prices.
In two clusters, price is dominant
(C1 — low price and C3 — medium
price). In other clusters, the back label
statements have a larger effect.
Perhaps the most interesting is C5,
where ingredient labeling has a very
large negative effect on the probability
of purchase. The advent of ingredient
labeling would certainly affect
people in this cluster.
The lowest price C1 cluster (which
is about 31% of the sample), values
food pairing and not much else. The
C2 cluster prefers wines at either
$13.99 or $19.99 and strongly values
information on winery history, production
methods, and both simple
and elaborate taste descriptions. C3
prefers prices around $19.99 and is
influenced somewhat by simple taste
descriptions and food pairing. Consumers
in C4 choose prices around
$25.99 for a gift or special occasion
and value elaborate taste descriptions
and history, but are negatively
influenced by ingredient labeling.
Overall, those clusters for which
price is the predominant and almost
only choice-driver represent about
half of the population (C1 and C3).
About one-third of frequent Australian
wine consumers (C2 and C4)
can be positively influenced by back
label information, especially history
and elaborate taste descriptions.
About one-third of frequent Australian
wine consumers are adversely
affected by stating ingredients on the
back label, with a small share (about
13%) of consumers (C5) refusing to
choose labels including them.
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