Does innovation propensity influence wineries' distribution channel decisions?

Purpose Wine SMEs are probably averse and powerless to produce low-cost, standardised and large quantities of wine, with the sales supported by heavy marketing campaigns. This means that the ability to develop effective distribution strategies represents for these firms a competitive driver to achieve unique and sustainable levels of competitiveness over time. At the same time, this is possible only if those wineries are able to be innovative. The aim of this paper is to analyses possible relationships between distribution strategies and innovation propensity. More precisely, the purpose of this study is to identify the existence of possible patterns around the way winemakers innovate and the way distribution channels are used. These determinants can support or constrain the winery’s behavior in the choice of strategy or for a specific distribution channel. Design/methodology/approach We focus on a sample of 191 Italian wine SMEs testing several hypotheses. Firstly a two-steps cluster analysis was used to identify 5 clusters of wineries in terms of level of innovation propensity and 3 clusters related to the choice of different distribution channels strategies. Secondly the research model has been evaluated using Multinomial Logit Regression (MLR) Findings The results of the Two-Step Cluster analysis revealed the existence of five well defined taxonomies of innovation propensity varying from “no propensity to innovate” to “propensity for radical innovation”. In addition, distribution channels were also categorized into three unique clusters. Findings also revealed a negative relationship between innovation propensity and distribution channels clusters. This means that the greater is the propensity to innovate and the greater is the winemaker freedom to opt for the most feasible distribution channels strategy. Research limitations/implications One possible limitation of this study is that the sample is from only one country. Practical implications Practical implication that emerges from this study is the encourage for entrepreneur and manager of wine firms to consider not only the type of strategies related to distribution channels but also the importance to invest in innovation. Conclusions suggest several theoretical and practical implications as well as some limitations. The main conclusion is that at the increasing levels of innovation propensity the choice for either wine-expert and/or direct channels of distribution is much greater than a general wholesaler Originality/value From literature it emerges a lack of research table to connect and measure the possible relationship between distribution strategies and innovation propensity. The value of this work is beginning to cover this area not yet covered in the literature, as well as it is detected in the practical implications for decision makers of little and micro wine firm.