Media Does Consumers’ Attention Influence the Price of Wine?

Does Consumers’ Attention Influence the Price of Wine?

uploaded July 18, 2023 Views: 67 Comments: 0 Favorite: 0 CPD
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The aim of this paper is to analyze the influence of wine consumers’ attention on the price of wine. We collect Google searches related to wine to capture consumers’ attention to wine and then analyze their relationship to wine prices measure through different wine indexes which represents the evolution of the price of wine in the market. The analysis realized in this paper requires data from Liv-ex Fine Wine 100 and Liv-ex Bordeaux 500 and Google trends. The dataset covers the period between January 2004 and March 2021 at a monthly basis.  We perform different models to analyze the relationship between both variables and the results indicate that there is a direct and significant relationship between them. We perform different robustness tests to check whether the apparent direct relationship between consumers’ attention and price wine indexes remains. Namely, we employ different proxies for the price of wine and we also perform a regional analysis for those indexes belonging to the Bordeaux region. The results clearly indicate the existence of a positive impact of wine consumers’ attention on all the indexes and indicators that measure the price of wine. Moreover, this finding remains regardless the indicator we use to proxy the price of wine and it persists significant irrespective the keywords and even the language or the Google Trends category from which we extracted the data. Hence, an increase in wine consumers’ attention leads to a surge in the price of wine. This is in line with previous studies that have shown the impact of Google searches on other traded commodities such as corn and, of course, oil or gold. Furthermore, we have shown that this relationship continues even at national or regional level. Thus, given the fact that Google data are evolving towards a more disaggregated level, even local in the US, these kinds of data can provide a very useful tool to wine producers’ to anticipate and monitor the wine consumers’ behavior and attention to their wines. 

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