The Use of Social Media by Wineries: A Case Study on Facebook Use in Sicily

Social media is more or less taking over (or running?) the world at this point! Well, while that statement might not be EXACTLY true, it is certainly a highly effective communication tool used by individuals and businesses all over the globe.

In addition to keeping up with family and friends, social media has become a low-cost way to promote one’s business, which has been shown in many studies to be an effective method for improving customer relations and sales when used in addition to more traditional marketing approaches.

Facebook is the biggest of the social media companies out there in terms of active users, with the service surpassing the 2 billion user mark just this past June. With over 2 billion users, Facebook is ripe with potential new customers, so it would be considered foolish for a

Photo courtesy Flickr user Hamza Butt

business not to be on the social media network.

According to one source (the paper I will describe in this post, actually), 94% of wineries in the United States has a Facebook page, while in other wine-producing regions, the number of wineries with Facebook pages is much less (as low as 53% in France).

There has been a lot of research into how and why companies use social media. First and foremost, research has found that companies/brands use social media to increase awareness about their products, by posting content and encouraging users to engage with them and each other in discussion of these products. With wine, studies have found that social media can improve wine sales by allowing users to post about and discuss a particular wine, which ultimately leads to others reading these reviews then subsequently going out and buying the wines themselves.

Other studies have shown that using social media as part of their marketing approach helps reduce the costs of advertising, as using social media can be very low cost for a potentially high return (technically it’s free if you don’t promote your page or posts online, though you still must consider the man-hours an employee has to put in to actually run the page).

In terms of economics and the return on investment of social media, research is somewhat limited.  However, those studies that do exist have found that there is positive correlation between the number of users talking about a company or product on Facebook and the company’s net revenue and number of employees.  Net revenue was not necessarily associated with other stats like number of followers, page views, etc. Basically, the way to increase the number of users talking about a company or product was to post high quality content with pictures and videos.

A new study, published in the journal Wine Economic and Policy, aimed to explore the use of social media (particularly, Facebook) by Sicilian wineries by looking at the social media behavior of the wineries and comparing that behavior with some company characteristics such as total revenue, size (i.e. number of employees), etc. The following are methods and results from that short study.

Brief Methods

This study focused on wineries in Sicily. While the researchers attempted to include 208 wineries, after filtering out who actually used Facebook and those wineries that did not provide responses to a questionnaire that was sent out, a grand total of 45 wineries were analyzed for this study.

To determine the effort wineries put into social media/Facebook, the researchers looked at three things:

  • Intensity: Quantifying Facebook activity. Calculated by dividing the number of posts and comments on the winery’s Facebook page with the number of followers of that page.
  • Richness: Qualitative analysis of a winery’s Facebook activity. Calculated as the ratio of the number of posts with videos, photos, or links and the total number of posts on a page.
  • Photo courtesy Flickr user Jason Howie

    Responsiveness: Qualitative measure of the interactions between the winery’s Facebook page and followers. Calculated by dividing the number of comments/replies made by the winery’s Facebook page and the total number of comments/replies by all users on that winery’s Facebook page.

The researchers then used statistical software to find similar groups or clusters of wineries for further evaluation.

Brief Results

  • The average number of posts per day by Sicilian wineries on Facebook was 0.244, with a max of 1.485.
  • Wineries received on average 22.85 (max of 185) likes and 2 comments (range 1 to 7) on posts.
  • Wineries had on average 3,690 followers (range 150 to 46,000).
  • Wineries preferred to use photos to share information with followers, with an average of 0.688 photos per post (range 0.364 to 1).
  • Links for more info were in 17.6% of posts.
  • 8% posted videos.
  • Intensity values were low on average for all wineries at 0.145.
  • Richness values were higher, as 90% of posts contained photos for greater interaction.
  • Responsiveness was relatively high, as 61% of total posts came from the same winery on the average winery Facebook page.
  • Cluster analysis revealed four distinct groups of wineries:
    • Cluster 1:
      • 15 wineries
      • Low values of intensity (avg 0.102): Limited effort on Facebook.
      • Low values of responsiveness (avg 0.386): Poor interaction with followers.
      • High values of richness (avg 0.921).: High numbers of photo and/or video-rich posts.
      • These wineries had the highest numbers of fixed employees (avg 7.6).
      • These wineries had the second highest average annual sales volumes compared with the other clusters (€2million).
    • Cluster 2:
      • 2 wineries
      • Low values of intensity (avg 0.006): Limited effort on Facebook.
      • Low values of richness (avg 0.477): Not as many higher quality posts with photos or videos.
      • These wineries had the highest average annual sales volumes compared with the other clusters (955,000 bottles, €1million).
      • Managers of wineries in this cluster were younger and less experienced than other managers.
    • Cluster 3:
      • 12 wineries
      • Highest values for intensity (avg 0.238): High effort on Facebook.
      • Highest values for responsiveness (avg 0.866): Most interaction with followers.
      • Highest values for richness (avg 0.938): High quality posts with photos and/or videos.
      • This group had mostly small wineries in terms of employees, bottles produced, and annual sales volume (avg 2.3 fixed employees, 111,800 bottles produced annually, €0million sales volume).
      • These wineries had the lowest participation in international wine conferences/fairs.
    • Cluster 4:
      • 16 wineries.
      • Mid- values for intensity (avg 0.134): Moderate effort on Facebook.
      • High values for richness (avg 0.913): High quality posts with photos and/or videos.
      • Mid- to high vales for responsiveness (avg 0.662): Good interaction with followers.
      • This group had mostly wineries that had been around for some time (avg 43 years).
      • The wineries in this group were mostly managed by people with the longest experience working in the industry (avg 25 years).
      • Employees in this group had the highest education and knowledge of many different languages.
      • This group had the third lowest annual sales volumes and did not spend much money on marketing.

Conclusions

This study provides a glimpse into the use of Facebook by wineries, with a specific focus on wineries in Sicily.  While it was interesting to see how the different wineries behaved on Facebook in regard to their efforts and how that relates to sales and other company statistics, the small sample size and limited geographical focus does not lend itself to generalizing over the wine industry as a whole.

The results of this study suggested that overall, Sicilian wineries don’t put a lot of effort into Facebook.  For those that do, it doesn’t look like the effort paid off much in terms of sales volumes.  Those wineries putting in the most effort had the lowest values in regard to sales volumes, though it is important to note that these wineries also didn’t make as much wine to begin with!  Therefore, can it really be said that social media doesn’t work for these folks?  Not quite.  For these folks, there isn’t a lot of money to allocate toward marketing or trade shows to begin with, so social media may very well give them the most bang for their buck in terms of marketing their wines.  A better comparison would be to find a winery with similar production volumes who doesn’t use social media to see how their overall sales volumes compare.  Of course, there are other factors that could influence sales volumes, but that comparison would be a good start.

One thing that may have been interesting would have been to compare the sales volumes of the wineries that actually used Facebook with the wineries on the list that did not use the social media site.  While this still doesn’t completely answer the question of whether social media use by wineries improves sales, it certainly answers it better than simply comparing only the small number of wineries that actually participated in the study.

Super briefly, other things that would have been nice to see (either in this study or a follow up): 1) how is social media used in other wine producing regions and how does that affect the bottom line?; 2) which social media network seems to be most effective for the wine industry?; 3) ?? your thoughts??.

I had other issues with this study as well, but in lieu of space (and time), I won’t bother to write about them now.  Feel free to share what you think about the study in the comments to discuss any issues you had (or positive thoughts!) further.

Overall, I thought this was a “meh” study, but seeing as how it is relatively easy to have a social media page these days and how it costs very little to do so (compared with other marketing strategies), I’d say the take-away from this for wineries is to make sure have a Facebook page (and possibly other social media accounts as well), post on a regular basis, and provide content-rich posts preferably with pictures and videos.

Source:

Galati, A., Crescimanno, M., Tinervia, S., and Fagnani, F. 2017. Social media as a strategic marketing tool in the Sicilian wine industry: Evidence from Facebook. Wine Economics and Policy 6: 40-47.

1 comment for “The Use of Social Media by Wineries: A Case Study on Facebook Use in Sicily

  1. August 24, 2017 at 5:03 pm

    Hi Becca:

    Coincidentally, I posted an article – “Does Social Media Help Me Sell Wine?” today on my website, and with a summary conclusions similar to yours.

    My opinion is that Social Media is simply another marketing channel and should be integrated with other DTC activities. Wineries that have the right expectations for results will get back what they put into it. And that means eventually selling wine as a result. Here’s the article: https://carlgiavanticonsulting.com/2017/08/24/does-social-media-help-me-sell-wine/

    Cheers, Carl

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