Read Between the (Wine) Lines

Written by: Joanne Sieljes

During the last decade, wine has become increasingly popular in the United States. Online wine retailers have made drinking wine become more accessible and affordable regardless of where consumers reside. Additionally, wine makers in the United States have started to produce more domestically, which has had a great impact on the industry. This goes hand in hand with the desire of people to shop more locally.

Nevertheless, old-world wine still has a great reputation when it comes to the quality that consistently generates high demand around the world. But, what if those desired wines are not actually as good as people believe? It all depends on whether wine can be considered as a luxury good. It is about the perception of price-quality, and the willingness to pay for a so-called “higher quality” product. It could be a very similar discussion to whether it is worth paying humongous premiums for fashion designer items of which the quality and the origin of the fabrics may not live up to the expectations. Would people rather have a good price-to-value wine, or would they rather show up at a dinner party with a limited-edition Burgundy Chardonnay? The key difference between a glass of wine and a designer bag is the method of consumption.

According to an article on MEREHEAD, tens of thousands of deaths annually are caused consuming low-quality counterfeit products. Moreover, people are becoming increasingly more health conscious. Blockchain technology can digitally eliminate fraud, which could in the future avoid such disasters. Even though wine is often sold at a premium due to its origin or exclusivity, research states 70 percent of consumers are willing to pay extra money for a wine of which the right quality can be ensured — this means, bottles that contain exactly what the label claims. These technological developments can geolocate when and where wines are being enjoyed, and the status and condition of the bottle during transportation (which is often where quality is affected). The birth of the wine is registered, how its grown, harvested and bottled. Then, when the bottle is opened, a QR code scan can see whether the bottle has been tampered with. Not only can Blockchain prevent manipulation with the process, it can also ensure authenticity and integrity of each bottle of wine. In short, wine can reach the customer with the taste the winemaker intended.

During the years, the interest in wine courses has risen, and it seems to have some degree of status to have a certain level of wine knowledge at a dinner table. Many people use an app such as Vivino, which is merely based on subjective consumer opinions. Blockchain makes it easier for people to understand the characteristics of the specific wine. Another benefit is that brands can diversify their product better. These days, people are very aware of certain profiles. All chardonnays are round and full, and a Gruner Veltliner is tart and fresh-tasting. With accessibility to more knowledge about the specific wine, pricing of wines can be set according to characteristics. It brings opportunities for upcoming producers that do not have the fortune to own a vineyard in a prestigious wine-making area, even though their fixed cost might increase from administrative tasks. It will also wake up well-established wine makers to continuously aim for the highest quality.

Blockchain will disturb the wine industry if all stakeholders participate and contribute their part in the product development process, from harvesting to consuming and everything in between.

This blog post was awarded Second Place in the Fall 2022 HFTP/MS Global Hospitality Business Graduate Student Blog Competition presented by the HFTP Foundation. Participants are students earning their HFTP-UH Global Masters Certificate, a program with candidates of the Master of Science in Global Hospitality Business. This program is a partnership between the CN Hilton College at the University of Houston, the School of Hotel and Tourism Management at Hong Kong Polytechnic University and EHL. The three blog posts that received the top scores will be published on HFTP Connect through February 2022. Read the first place blog post here.

Joanne Sieljes is a graduate student currently pursuing the Master of Science in Global Hospitality Business program, which is in partnership of three schools: EHL, the Hong Kong Polytechnic University, and University of Houston.

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