Willingness to Pay for Sensory Properties in Washington State Red Wines

Abstract

In this article, we evaluate how sensory qualities of wine, such as astringency, bitterness, aroma, and flavor, affect consumers' willingness to pay for wine. In order to accomplish this objective, we utilize data collected from untrained consumers, a trained panel, and laboratory measurements of tannin intensity. From this data, a consumer-preference model, a consumer-intensity model, a trained-panel model, and an instrumental-measurement model are estimated and compared. Overall, the consumer-preference model is the most accurate in predicting consumers' willingness to pay. As expected, the closer a wine is to a consumer's ideal, the more they are willing to pay. Astringency has a mostly positive effect, and bitterness has a negative effect. Comparing the accuracy of the other models, the instrumental-measurement model is the next best, followed by trained-panel model, and the consumer-intensity model. This suggests that the instrumental measurements can be used as an effective alternative to trained panels. This is important because trained panels may be less practical to use on an ongoing basis. (JEL Classification: Q13, M31)