1. 1/5/2016 ESC Dijon : Where Old World meets New | vitisphere
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ESC Dijon : Where Old World meets New
Monday January 04 2016 by Sharon Nagel
In 2015, Burgundy School of Business made its debut in the Financial Times'
international ranking of the best Masters in Management. The school’s global
ambitions were further confirmed with the arrival of Australian academic
Professor Roberta Crouch as the new director of the MSc in Wine Business last
October. Professor Crouch joined the SWSB from the University of Adelaide
where she was Director of the Masters of Wine Business and the Chair of the
Wine Future Research Cluster. Specialising in consumer behaviour and country
of origin effect, she brings to the school her experience as a lecturer and
researcher, but will also take advantage of her stay in France to improve her
understanding of a country whose name is synonymous with world­class wines.
What are your plans for the Wine Business
department in Dijon?
My area of work is in wine business and I think in the past, many people have
thought only in terms of wine marketing. Wine business is much more than that:
it’s about product development, distribution channels, finance, cross­cultural
issues, and all of the things around the business of making and selling wine.
This translates to the whole value chain, from vine to glass. In the past, people
in the wine industry, especially in medium to smaller sized entities, tended to
think that the business side just comes along naturally. Of course, it doesn’t. The

2. 1/5/2016 ESC Dijon : Where Old World meets New | vitisphere
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industry is really waking up to this, certainly the larger organisations – they
have expertise in all areas because they are first and foremost successful
business, and they just happen to be in wine. They share many common
attributes with all successful industries. In the wine industry, where we tend to
have a lot of family businesses and smaller to medium sized entities, there is
now an understanding in this hyper competitive global industry that specific
expertise in business is needed too.
You have a fairly unique vision of Australian/New
World versus French/Old World wine marketing.
What would you say were the major differences
between the two?
It’s probably a bit early for me to assert expertise on the French wine industry.
Certainly, I think that France, Spain, Italy and the other Old World countries
have been the leaders of producing and selling wines, particularly premium
wines, around the world. I’ve just finished a seven­country study for Wine
Australia on country of origin and consistently, from New York to London, to
Beijing to Ho Chi Minh city, the opinion is that the best wines in the world
come from these Old World countries. This is due to their heritage, which you
can’t buy – they own the heritage position. They’re seen to be artisans and
steeped in something they’ve been doing since forever. Whereas the New World
producers have a different attitude towards time and they’re a bit edgier, more
willing to try new things. Possibly, there is a kind of inferiority complex with
New World producers, maybe they go in assuming people won’t think their
wines are as good as they could be or as good as they are. It’s difficult when,
like Australia, you’ve been perceived as being the producer of “the bloody good
wine for the money” – you assume you’ll have to take a back seat to the Italians
or the French, although that’s not so much the case any more, some great wines
are being produced in Australia. The only frustration is that they struggle to gain
acknowledgement for producing these wines.
The research project you mention revealed that
international consumers find Australian wines and
winemakers “authentic and exciting”. Can you
elaborate on the research?
It’s a three­year project funded by Wine Australia. Nobody has ever done it
before. We looked to established markets in the USA and the UK and then five
Asian markets ­ India, Vietnam, Korea, China and Indonesia ­ at different levels
of maturity or entry into wine consumption. The study is qualitative and
quantitative, consumer and trade­based. We used local research companies to
conduct the interviews, surveys and focus groups because we didn’t want to
taint the results, obviously. It was the first time anybody had asked the
international consumer of Australian and other wines – including French and
South American ­ what kind of attributes they looked for in different wines, the
country of origin images. This was the first time the Australian wine industry
had held the mirror up and looked to see what other people saw in it: what sorts

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of emotions, what aspects of premiumisation, what were their impressions of
foods from Australia and other countries, etc. One of the best quotes that came
out of the study was from a premium consumer in the United States who said:
“People who cannot produce fine food cannot produce fine wine”. That’s a
logical comment and was reflected very strongly in the UK as well, but not so
much in the Asian countries because wine and food consumption are not so
strongly associated, although there was still a connection. In terms of attributes
that came spontaneously to consumers mind when asked what they thought of
Australian wine, there was exciting, authentic and consistent for example.
Authentic and exciting have not been descriptors
particularly associated with Australian wines in
recent years. How do you explain the turnaround in
perception?
I don’t recall anybody ever asking consumers what they thought of Australian
wines. I think we’ve been listening to what wine writers and other industry
sources say. It’s also fair to say that brands like Yellow Tail and Jacob’s Creek
in the United States have positioned Australian wines for many people,
especially in the industry. The positioning statement – “bloody good wine for
the money” – is often used for Australia. Consumers of Australian wines think
this too, but they also think it about Chilean and other wines. But nobody had
ever asked them, when you think about Australia, what kind of images come to
mind? Consumers tend to halo the products countries produce.
Australia was at one time seen as a role model by
European producers. More recently, Australian wines
have struggled in the global wine market. Where did
they go wrong?
I’m not sure wrong is the word. I think that globally, the wine industry is under
a lot of pressure. There are a lot of people producing a lot of wine. Australians
were probably riding a bit of a wave and why not? There have been a lot of new
entrants into the global wine market and some of them have put a squeeze on
Australian producers. In regions such as South America, the costs are so much
lower and they often can produce a lot of wine, a lot of which is also very good.
So the position that Australia enjoyed on its own for quite a while, is now a very
hotly competitive space. There are also large consumer markets that drink their
own wines, such as China, and will consume even more of it. The industry is
now very aware of the fact that it’s not just a case of selling the wine you
produce, but of selling it at the price you need to get. That’s where the emphasis
is right now and that’s why studies like the ones I’m involved with are
commissioned.
What is the main focus of Australian wine marketing
today?

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It’s about premiumisation but not about giving up the value­priced drop – we
don’t want to give up that space. Especially in countries that are open to
Australia and have very positive images of Australia, it’s about telling
consumers that not all premium wines come from the Old World; we make
some too, and they’re worth the money. There was never a problem with our
better wines – people always said they were good. The problem was you had to
have people thinking they were worth paying for. In countries like the UK,
where there’s huge consumption of wine but also the world at its doorstep and
it’s part of the EU, trying to secure that premium price point is challenging.
Through the study, we saw that Chile was very prominent in all the countries we
looked at and their costs are so much lower, particularly than Australia where
wages are very high and water is very expensive. There is a lot of pressure on
wine growers not to use water – people are asking whether it’s right to put all
this water on grapes when we could be growing something else that has a better
return.
Are you currently working on other research projects?
I’m involved with a project led by the school of agriculture, food and wine at
the University of Adelaide and funded by the Australian Research Council, into
wine products. I also have a PhD student working on acceptance of lower
alcohol levels in wine. We’re testing and investigating a wine­based product
with no alcohol in three countries – China, France and Australia. We’re looking
at the degree to which a very traditional product like wine would be accepted at
lower levels, or indeed no alcohol at all. If so, what would people be willing to
pay for it? What would be the perception of its authenticity – is it still ‘wine’ at
3%? And what varietals, styles and flavours would be the most acceptable? I’m
also working on the influence of a family brand: one of the things that is not
unique to wine, but prevalent in the industry, is the family business, with the
notion of heritage and tradition. We’re studying Germany, Australia and
Singapore, for family brands from different countries. I’m also interested in
wine tourism and look at how critical place of consumption is and the influence
of the tourism experience. I did a study a couple of years ago that showed you
can mimic and recreate a tourism experience on line. So, you don’t even
necessarily have to bring people to your typical location but you can still create
interaction with a brand and build engagement. It’s interesting to see how
people approach the hedonistic aspect of wine and this goes hand in hand with
travel, experience and memories and what you associate with those memories.
Wine tourism is therefore really important.
France has many advantages over other countries
when it comes to wine tourism. Do you think it has
fully realised its potential?
I think the industry is becoming more and more aware of this. There is still an
assumption that the wine will sell itself and I think that’s an assumption made
by all great producers of wines. It’s also true of Australians. France is one of the
most favoured destinations in the world and that’s not going to change but I do
think there’s still a lot of potential, especially for the domaines and cellar doors.

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The big estates obviously get it and visits to them are wonderful. One of the
things I’ve consistently discovered in many countries I’ve studied is that
consumers of premium wines don’t want a mainstream experience. Anybody
can do that. They want something a bit special, they like to have a bit of an
inside edge. A lot of expensive wines are produced on a small scale, they’re not
available to everyone and consumers of them want to have a unique and, in the
case of France, a uniquely French experience. People pay for that ­ that’s not my
discovery, it’s years old. There’s so much that could be done at cellar doors and
tastings in France. I think they’re waking up to it but in terms of investing in
talking to people about brand, values and what you want people take away in
their hearts when they leave you or when they see your label, that costs money
and not everybody knows how to do it.
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