Abstract
We analyze price and product quality data differentiating producer brands within 27 global wine regions. Using a data set with 43,446 observations covering global production over five vintages, we define brand image based on the difference of a brand’s quality average relative to the associated regional average. We propose the hypothesis that prices based on a positive brand image should rely less on regional reputation indicators and vice versa. Our model largely confirms this hypothesis but also suggests that at least for some regions (e.g. Germany and New Zealand), brands performing above the regional quality average still rely more on regional reputation than regional competitors performing below average. That implies that these high quality brands must build a stronger quality reputation of their own such that outperforming their regional peers also pays a dividend in terms of higher prices.