Status Games: Market Driving through Social Influence in the U.S. Wine Industry

Abstract

Research on market orientation finds that market-driven firms succeed by identifying and appealing to consumer needs. Yet many technologically innovative firms achieve remarkable success by taking a market-driving approach. The ways that firms drive markets without disruptive innovation, however, remain unclear. Adopting a market-systems perspective, the authors conduct an ethnographic analysis of producers, distributors, retailers, critics, and consumers in the U.S. wine market. They find that firms drive the market by playing a status game. Firms pursue a vision and advance that vision among influencers inside and outside the industry to gain recognition. Winners of the status game influence and drive social consensus by setting benchmarks and shaping consumer preferences to the firm's advantage. High status is difficult to imitate, creating an advantage that can endure for years or decades.

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