How Many Latours Is Too Many? Measuring Brand Name Congestion in Bordeaux Wine

Abstract

AbstractFirms rely on brand names to market goods to consumers, and consumers rely on brand names to locate goods that satisfy their preferences. If multiple firms are using the same or similar names, consumers may be confused about which product to buy, and firms may not obtain the benefits of their investments in quality. Recently, both firms and scholars in a number of industries have expressed concern about brand name congestion—too many firms clustering around too few terms. This paper applies computational linguistic analysis to chateau names in the Bordeaux wine region to study the degree of brand congestion within a mature, traditional, and high-value market. We find that Bordeaux producers have highly similar names to one another, far more than in comparable wine regions such as California and Alsace. More than a quarter of all Bordeaux producers have a name that is identical or nearly so to at least one other producer, and many terms are claimed by dozens of different producers. Interestingly, however, we find that the most famous and renowned producers have names that tend to be more distinctive than their less famous brethren. (JEL Classifications: C88, D83, L66, O34)