Cellar Door: An Industry Paper

Here's a little article that appeared in Grapegrower and Winemaker Magazine a month in November which you can get to at  http://www.winebiz.com.au/gwm/backissues/index.asp?ID=81. The University's Faculty of the Professions has agreed to fund Teagan on a PhD in this area, and she's just enrolled. A simple little start with this one.

Winery Cellar Door Servicescape: A Visual Content Analysis

Teagan Altschwager¹  - teagan.altschwager@student.adelaide.edu.au

Dr Steve Goodman¹ – steve.goodman@adelaide.edu.au

Dr Cullen Habel¹ – cullen.habel@adelaide.edu.au

The University of Adelaide Business School

This article presents the first results from research examining the servicescape of winery cellar doors and consumer purchase behaviour.  In this paper we present the results from the researcher analysis of the cellar door and staff reports of consumer behaviour.  In following articles we will present the results of data collected from customers of the wineries.  If you are interested in further information and updates in this area please contact the authors above.

Introduction

Servicescape, the physical environment surrounding the consumption of a service, is identified as being of paramount importance in terms of eliciting favourable consumer responses (Baker, Levy, and Grewal, 1992; Bitner, 1992; Gilboa and Rafaeli, 2003; McDonnell and Hall, 2008; Tombs and McColl-Kennedy, 2003). Servicescape, described by Baker (1987) and Bitner (1992), comprises Ambient Factors, Design factors, and Social Factors. A positively perceived servicescape is proposed to lead to ‘approach behaviours’. This may cause the consumer to display high levels of attraction, increase the time spent within the service space, enhance their propensity to spend, increase their likelihood to revisit, and ensure that the intended purpose of which they entered the service space is carried out (Mehrabian and Russell, 1974); conversely, if a servicescape is perceived negatively, opposing ‘avoidance behaviours’ may be elicited. Servicescape is known to have a heightened effect in hedonic services, as the physical surrounds aid in creating an ‘experience’ for the consumer (Hightower, Brady, and Baker, 2002). An identified gap within servicescape literature is the potential for moderators within the primary relationship (Bhardwaj, Palaparthy, and Agrawal, 2008), suggesting that an individual’s characteristics could be of particular relevance. This paper discusses a recent study conducted within five wineries located in the McLaren Vale wine region, South Australia. Each was evaluated on the quality of servicescape within their cellar door by Visual Content Analysis, a structured observational technique, using an evaluative tool devised by McDonnell and Hall (2008).

McDonnell and Hall’s “Winery Cellar Door Servicescape Scoresheet”

McDonnell and Hall’s (2008) “Winery Cellar Door Servicescape Scoresheet” was used to collect data, due to its specificity to cellar doors, and face validity of being a comprehensive analysis of servicescape.  The scoresheet contains six sections, and displays major commonalities with Bitner’s (1987) servicescape dimensions, as outlined in Figure 1. Although Sections E and F were not identified by Baker (1987), they have particular relevance to cellar doors and were thus included to ensure a comprehensive evaluation.

Figure 1: Servicescape Dimensions Examined  

Adapted from Baker (1987), Bitner (1992) and McDonnell and Hall (2008)

The scoresheet was adapted to overcome limitations of the tool. Firstly, the scoresheet was a 10 point marking system; marks from 4-10 are considered satisfactory, and only 1-3 express unsatisfactory servicescape; this skews the evaluation towards a positive mark, and was thus changed to a nine point system. In addition, a number of measurement items were included and excluded from the scoresheet, outlined in figure 1. This ensured that the scoresheet was comprehensive but did not include items irrelevant to directly measuring servicescape.

Research Method

The study was conducted by Visual Content Analysis (VCA), and was isolated to a single wine region to exclude extraneous variables, such as perceptions about a wine region, from influencing the results. The five wineries were chosen through non-probability judgment sampling which allowed for selection on the basis of style of cellar door and descriptive statistics; namely crush range, export percentage, vineyard area and case production range, outlined in table 1. This is expected to result in a diverse selection of wineries, which aids in obtaining higher levels of generalisability within the data set.

Table 1: Wineries in the Study         Source: Wine Industry Directory, (Winetitles, 2010).

Winery	Crush Range (Tonnes)	Export Percentage	Vineyard Area (ha)	Case Production
A	100-249	51-75	44	5000-9999
B	1000-2499	1-25	60	100000-249999
C	500-999	1-25	30	20000-49999
D	500-999	26-50	60	20000-49999
E	500-999	51-75	250	20000-49999

 The purpose of the VCA is to obtain an objective indication of servicescape within the participating cellar doors. Data can be used to accurately reflect the level of servicescape, and compare between each of the cellar doors to indicate divergence in servicescape quality. Data concerning visitor behaviour can be compared to infer the effect that servicescape may have on consumer response. The results may also suggest potential causes for discrepancy in the primary relationship, and will thus help identify potential moderators to be further investigated. The observational analysis was conducted by two observers, the primary researcher and a research assistant, in order to minimise subjectivity bias. Consistency of results was ensured by conducting pre- and post-observation debriefing; pre-observation debriefing ensured common understanding between the researchers by explaining key terms and the observation process. Post-observation debriefing was conducted to resolve any inconsistent findings. With one exception, the total scores obtained by each of the observers for each winery was very similar, which we take to represent reliability in the evaluation method. Winery D, however, received divergent observer scores; it was concluded that this difference may have resulted from the observers being new to the process, as winery D was the first to be observed. Reassessed scores were then determined. The final ‘servicescape score’ for each winery was derived by calculating the mean of the two observers’ scores. Observers made informal notes to supplement the numeric scores, and cellar door staff were asked three questions at the conclusion of the observation; firstly, for an estimated number of visitors daily, on a normal weekend; secondly, the estimated percentage of those visitors who would purchase wine; and thirdly, the average number of wine bottles they would purchase.

Results and Analysis

The VCA findings will be presented through individual winery discussion, followed by overall findings. The servicescape score and visitor information are outlined in Table 2.

Table 2: Comparative Ranking of Wineries

 

Individual Winery Discussion

Research by Orth, Heinrich and Limon (2010) indicates that wineries vary in terms of store personality dimensions and design. These attributes are reflected in the individual wineries currently under study. Winery A is considered to be a ‘boutique’ winery, not only for its small production size as indicated in Table 1, but also for its differentiated, niche strategy in terms of cellar door design. The cellar door displays a mixture of ‘modern’ and a raw, ‘shed’ style, and is highly successful in achieving both individualism and perceptions of high quality. This was evident from the consistently high marks obtained for ‘Internal-, and External-Presentation’, with a score of 7 and 7.8 for each section respectively. It displays ‘low content design’ due to the ‘open, contemporary’ feel, with an ‘enthusiastic’ store personality (Orth, Heinrich, and Limon, 2010). Winery A ranked first for servicescape (291), third for visitor numbers, and last for both percentage of visitors who purchase and amount purchased.

Winery B is considered a well known, large scale, commercialised winery, due to its age and production size as outlined in Table 1.  The cellar door ranked second for servicescape (285), and displayed a ‘rustic’ style cellar door. The cellar door had an air of elegance and prestige, while maintaining a feeling of heritage with its wooden coverings, and prominent, antique displays portraying its history. This is reflected in the ‘Internal Presentation’ mean score of 8.5, including an 8.5 for artifacts specifically. This classifies Winery B as having a ‘complex-shell design’ of ‘natural, elaborate, and harmonious’ style, with a ‘sophisticated’ store personality (Orth, Heinrich, and Limon, 2010). The winery ranked first for number of visitors, and fourth for both percentage of visitors who purchase and number of bottles purchased.

Winery C’s cosy cellar door displays a mixture of ‘cottage’ and ‘rustic’ style; the cellar door, conjoined restaurant and garden area that “nestle into the hill”, and stone features create a quaint, homely and traditional feel. As a result, this winery is considered a combination of ‘complex-shell and low content design’ as it is ‘natural and harmonious’, yet ‘open, airy and delicate’, with a ‘genuine’ store personality (Orth, Heinrich, and Limon, 2010). The winery ranked third for servicescape (222), second for both number of visitors and percentage of visitors who purchase, and third in terms of bottles purchased.

Winery D, although the most recently established in the sample, was evaluated as an ‘aged’ cellar door. The cellar door is situated inside an old homestead, with majority of the original structure maintained; the cellar door and tasting counter are located in the refurbished kitchen which emphasises the ‘cottage style’ theme, however has been evaluated as somewhat impractical in terms of having a serviceable, spacious cellar door area. These comments are supported by the average scores for External and Internal Presentation, with a mean of 5.2 and 4.5 respectively. This relates to Orth, Heinrich and Limon’s (2010) ‘moderate shell design’ and displays ‘genuineness’ in terms of store personality, due to its ‘honest and true’ image. Winery D ranked fourth for servicescape (191), fourth for daily number of visitors, third for percentage of visitors who purchase, and second in terms of bottles purchased.

Winery E was considerably divergent from others in the study; there seemed to be no particular attention paid to cellar door design, with no recognisable theme. The space gave a feeling of “being in an actual cellar”, and was evaluated as cold and unwelcoming upon approach. However, this winery received the highest evaluation for ‘Staff Presentation’ with a mean score of 7.6. This winery relates to Orth, Heinrich and Limon’s (2010) ‘minimal shell design’, due to its ‘industrial’ feel, and has ‘solidity’ in terms of store personality, conveying a ‘solid, hardy, reputable’ image. Winery E, ranking last in terms of servicescape (179), and number of visitors, ranked first for percentage who purchase and amount purchased.

Diversity of the wineries

Results show significant differences between the wineries in all aspects of evaluation, as intended by the judgement sampling technique. This confirms previous works by Orth, Heinrich, and Limon (2010) that indicate significant variation in wine cellar door styles.

This aids in generalisability and also allows for greater comparison between the divergent wineries. The difference in response behaviour elicited by consumers is more easily identifiable when divergent wineries in terms of servicescape evaluation are compared.

 

Relationship between servicescape and visitor purchase behaviour

Results indicate a negative and significant relationship between servicescape evaluation and reported consumer purchase behaviour, with Spearman’s Rho of -0.9 (sig 0.037) and -.949 (sig 0.014) for percentage of visitors who purchase and amount purchased respectively. This is evident from winery E that, although receiving the lowest score for servicescape quality, ranked first for both percentage of visitors who purchase, and the amount purchased. This relationship is very interesting, and is initially perceived as demonstrating the relationship between servicescape and response behaviour to be invalid. However, as literature suggests (Bhardwaj, Palaparthy, and Agrawal, 2008), this result may in fact identify a moderating variable between servicescape and response behaviour. This finding indicates a need for further research into moderating variables that influence the primary relationship.

 Conclusions and Further Research

In conclusion, this study implemented McDonnell and Hall’s (2008) data collection tool to conduct visual content analysis on five McLaren Vale wineries. Findings show significant differences between the wineries in terms of descriptive statistics, evaluated servicescape, and visitor behaviour. A negative relationship between servicescape score and visitor behaviour was found. It is proposed that the negative relationship between servicescape and visitor behaviour, concluded from the study, identifies the presence of a moderating variable. A predicted moderator is an individual’s characteristics; a particular facet that has been identified within servicescape literature, but has barely been researched (Bhardwaj, Palaparthy, and Agrawal, 2008). Based on further literature reviews we suggest that Product Engagement is likely to play a key moderating role and will be investigated in the next step of this research. If consumers visiting Winery E possess high levels of product engagement, they will be more loyal consumer and may have more favourable purchase behaviour regardless of cellar door servicescape. Obvious study limitations are inherent in the small sample size and isolation of the wineries; however these findings are believed to form the basis from which further research can develop. Continued research on servicescape, including potential moderating variables, aids in creating a comprehensive image of the construct which will prove invaluable for implementing servicescape strategies effectively within wineries. Further studies will pay particular attention to cellar door consumers; their level of product engagement, perceptions of servicescape, and response behaviour. We look forward to reporting the results of the consumer perceptions of cellar door servicescape in a future issue.

Teagan Altschwager is an Honours Candidate at the University of Adelaide Business School, conducting research on Cellar Door Servicescape and Consumer Behaviour, Dr Steve Goodman is Senior Lecturer in Marketing and Program Director  Higher Degrees by Research; Dr Cullen Habel is Lecturer in Marketing, both at the University of Adelaide Business School. Their research involves wine choice (consumer and supply chain), social media and market modelling in both domestic and international wine markets.



 

References

Baker, J. 1987. The role of the environment in marketing services: the consumer perspective. The Services Challenge: Integrating for Competitive Advantage, American Marketing Association, Chicago, IL: 79-84.

Baker, J., Levy, M., & Grewal, D. 1992. An Experimental Approach to Making Retail Store Environmental Decisions. Journal of Retailing, 68(4): 445.

Bhardwaj, S., Palaparthy, I., & Agrawal, A. 2008. Exploration of Environmental Dimensions of Servicescapes: A Literature Review. ICFAI Journal of Marketing Management, 7(1): 37-48.

Bitner, M. J. 1992. Servicescapes: The Impact of Physical Surroundings on Customers and Employees. Journal of Marketing, 56(2): 57-71.

Gilboa, S., & Rafaeli, A. 2003. Store environment, emotions and approach behaviour: applying environmental aesthetics to retailing. The International Review of Retail, Distribution and Consumer Research, 13(2): 195-211.

Hightower, R., Brady, M. K., & Baker, T. L. 2002. Investigating the role of the physical environment in hedonic service consumption: an exploratory study of sporting events* 1. Journal of Business Research, 55(9): 697-707.

McDonnell, A., & Hall, C. 2008. A framework for the evaluation of winery servicescapes: A New Zealand case. Pasos, 6: 231.

Mehrabian, A., & Russell, J. A. 1974. An approach to environmental psychology: Cambidge, MA: The MIT Press.

Orth, U., Heinrich, F., & Limon, Y. 2010. Designing Wine Retail Interiors to Elicit Desirable Consumer Impressions.  , 5th International Academy of Wine Business Research Conference. Auckland (NZ).

Tombs, A., & McColl-Kennedy, J. R. 2003. Social-Servicescape Conceptual Model. Marketing Theory, 3(4): 447-475.

Winetitles. 2010. Australian and New Zealand Wine Industry Directory

Establishing a Presence in Social Media - Facebook

From Australia's Grapegrower and Winemaker Magazine, August 2010. Just a basic little article, and many of my readers know all this stuff, but we were simply introducing this stuff to winemakes - a very diverse audience.

In the following three part series Steve Goodman and Cullen Habel explore commonsense ways to get amongst the “Facebook Generation” with your brands and your people. They argue that these days, having a presence in the world of social networking is as important as having a sign off the main road that points to your cellar door. Over the next few issues, methods for Facebook, Twitter, Google Maps/Foursquare will be explored. It’s not that hard – and the chances are some of your younger employees would LOVE to set it up for you.

Once it was the Piazza, now it’s Facebook, the PC and the iPhone

First, let’s recognise the similarities. People love to hang out; watch each other, share their opinions and advice and sometimes argue. A hundred years ago one would walk out to the Piazza – or the market square – just sit, chat, and watch the world go by.  It happens now, but it happens on a bus, on a train, walking up the street, sometimes at home, and often at work. Rather than a market square, there’s a place called Facebook. Rather than walking or driving, a person will flick on their web-enabled phone or open up a browser window on their computer. If you were allowed to put up a sign in the market square – at no charge – wouldn’t you consider it? You CAN put such a sign up in the virtual Piazza, and it’s not hard. Many Australian and Global wine companies already have – but not that many, leaving a space you can begin to see benefits from your activity

So how does it work? Facebook – for one – lets anybody in. All you need is an email address (a Hotmail one will do), fill in a few online forms, and you’re in. You can do a quick search for people you know, hit the ‘add friend’ button and once they do the same you’re away. Before you know it you’ll have “friend requests” from all areas of your past life – for better or worse. On average, people seem to have around 150 friends.

Most people take a few months to get used to the world of Facebook and many never bother – they simply let it sit there. Even that’s a plus – at least then you own that Facebook identity. Increasingly in the world of social media identities the term “you snooze you lose” applies. Ask Penny Wong, Bronwyn Bishop and Andrew Bolt – all of whom have been beaten in the race to snap up their names (in this case on Twitter, which we will discuss next issue).

From there Facebook has an array of communication methods; a wall, notes, messaging, chat, status updates. People use these to communicate as privately or as publicly as they like.

So as a business, what’s Facebook to me?

If one simply wants to advertise – in the old sense – then Facebook can help you. Most users list their likes and dislikes; if you say you like golf then the banner ads you see will be all about golf gear. As a marketer you pay your money, get your ads and – often – get them ignored. But that’s the small side of social networking. We’re here to meet the customer in their own space.

Winery Personalities

No, not the personality of your winery but of the people within it. Think of Kevin Rudd’s hugely successful 2007 campaign – his personal friends list topped out at 5000 friends two weeks after it was opened. Many people choose to restrict their friends list to only close friends but others – some politicians and University lecturers – allow it to be public.

The winemaker can be the face of the winery, look at Rebecca and Lucy Willson of Bremerton, or Chester Osborne of d’Arenberg. Winemakers are often urged to make connections; out in the press, at functions, events, tastings and general goings on in the region and – of course – the overseas trips.  Facebook could help here – and increase your reach.  In simple terms, your winemaker, viticulturist or even character cellar door manager opens up a Facebook account – it’s easy.

As a winery personality, it’s important to keep content “on message” rather than one’s own personal trivia. Imagine:

·         ‘been in the vineyards and noticed the first budburst down near the creek’…

·         ‘just been in the winery hand-plunging – looks inky’

·         ‘opened up a bottle of the 1995 for some visiting overseas journalists yesterday – they were impressed, I was blown away’

·         ‘had the CabSauv last night with slow roasted lamb shanks. Wow! – recipe and photo attached here’

With an approach like this the winery can have one-on-one communication with literally thousands of people. It’s like sitting in the piazza in the 1800s and swapping stories, especially when those ‘friends’ (customers) are then posting notes back to let you know what and where they enjoyed and had with your wine.  Market research, relationships and customer feedback – for a nominal cost of about a few hours each week!

• What to do.  Get your winemaker, owner, cellar door manager (or someone else you trust) to use their profile expressly for the purpose of business use. Allow them to become the face of the winery. Use it at least weekly as an interactive journal – vineyard goings on…winemaking…tasting…food they’ve enjoyed.  Not too much, not the same day everyweek, but regular and ON-MESSAGE. It’s your first foray into social media.

A Winery Page and Forum (Wall)

You may not find someone who wishes to be the face of the winery – no bother. Your winery can have its own page. You can build the personality of the winery there – many people prefer to.

Everyone that ‘likes’ your winery can click a simple tab to say they ‘like’ you – which is then broadcast into the Facebook world and spreads throughout their network – working like direct mail to bring customers into your winery facebook page – and spreading your brand.  On that, people can make a posting to ‘your wall’ – similar to graffiti but usually welcomed!  If they’ve enjoyed one of your wines with a food type they can let the world know (if they’re your friend) – you’d be amazed at how much time some people will put into this activity – with photos of food and places, recipes and the like. A little bit of effort, prodding and your winery site can come to life – and it is friends (customers) that effectively do 99% of the work

Duplin Winery of North Carolina has over 11,000 fans. On this winery page they can very simply (and quickly) upload photos, update on the vineyard, talk about recent tastings – any number of things. EVERY one of those 11,000+ fans will have Duplin’s announcements in their daily feed.

Set this up for yourself and suddenly your winery springs to life.  It takes on a shape of its own; people are interacting with it, photos are seen and commented on. You have become a part of your customer’s daily life. Again this may cost possibly an hour a week.

There is a chance it will be a small to moderate success, but there is also the chance that with the right effort in the right areas it could spread virally. This can bring people to visit your physical cellar door as well as choosing your wines in a bottle shop or restaurant. Having friends on a Facebook site is great, but getting talked about, shared and commented on is what will really assist.  Keep that in mind when you are establishing your objectives.

• What to do.  Get onto Facebook and establish a page for your winery.  Sit down and think about what you might like to achieve with it.  Look at some other business pages on Facebook – then look again at your own objectives.  Start putting comments, photos and the like to your site – and let people know it is there.  Get it onto your website, letterheads, labels – maybe even onto a tear off on your back label.

Winery Events

The wine loving loves events – for the aesthetic beauty of the surroundings, the opportunity to learn about wine or even the plain old fashioned reason of having a few drinks and a good day out.  Before Facebook, a winery would need to promote their event using their own databases, direct mail and advertising. These days your existing events promotions can be supplemented with a Facebook feed – at no charge.

A Maryland (US) winery – Terrapin – is shown above with three events in their listing. As soon as they “publish” the event a notification will appear in the news feed of all the winery’s fans – and the page includes photos, comments and the like. Even better, when a fan chooses to RSVP, all of their friends are made aware of it. The word of your event can spread virally and suddenly that ‘little’ new release tasting complete with tapas you had planned has a life of its own.

If your 250 strong fan list has had 25% RSVP, it’s likely that 10,000 people will have the chance to see your event on Facebook. What did it cost you to advertise and promote this event – probably about 30 minutes!

• What to do.  Think of something that’d give people the incentive to come to your cellar door – tasting of the new vintage, museum stock, budburst or maybe even a restaurant ‘cellar door’ dinner in the metro area. Build it as an event in Facebook, share it, even RSVP yourself. Let people know the event is there, and give it a lead time to allow for planning and sharing of the information. Take some photos and upload them after…and use it to promote the next event.

Applications

People spend  an amazing amount of time on Facebook, and it’s not always just talking to each other. Any number of games and activities have made their way onto Facebook; people play Scrabble, Texas Hold ‘em, plus a whole new range of games such as “Farmville” and “Cafe World”. In Facebook world these are referred to as “Applications” and they can be used to do more than simply play games.

Wine related applications include “Wine word of the Day”, “Wine logs from Logabottle” and “My Vineyard” – yes, a game where people build virtual vineyards

 Building applications is beyond the abilities of many of us, but your web designer can help you with this. The opportunities for this are endless – a regional cellar door finder, regional tasting notes, competitions or games. This probably won’t come at no charge, but it’s well within your reach.

Get in the game

So if you have a sign out the front of your winery then our challenge to you is: “Why don’t you at least have a presence in Facebook?”

There are huge demands on the time of winemakers and wine marketers. Exporting winemakers are urged to “get on a plane” and visit distributors around the world. Winery staff are pulled in all directions. It’s not surprising, then, that the complaint is that “I simply don’t have time for another thing” but done right it can make you more efficient. If maintaining a Facebook presence can save one overseas trip, fill one 120 person function or create an unexpected cult following for one of your brands isn’t it worth that few hours a week for someone in your business to do it?

Your young staff members live in this world – they set up fan pages and events every day of their life, on their PC, their mobile phone. Ask them to set up an event for you and they can have it done before they leave work today. Or you can do it yourself.

Over the next two months we will discuss how you might use “Twitter” – a broadcast micro blog – and “Foursquare” – a location based social network – to further engage with your customers and meet them in their place.

About a year ago a guy in California ran a blog that gives a great “how to” guide for even the newest new user. Check out http://fb4wineries.wordpress.com/ for  a more comprehensive guide, and Bakas Media writes a great blog on social media and wine, too.

Steve Goodman is Senior Lecturer and Program Director  Higher Degrees by Research; Cullen Habel is Lecturer in Marketing, both at the University of Adelaide Business School. Their research involves wine choice, virtual communities and market modelling in both domestic and international wine markets.