FACULTY FOCUS
5 Questions for Miguel Gomez

By Amanda Garris

Assistant professor of applied economics and management Miguel Gómez specializes in marketing, price analysis, and industrial organization. Since his arrival at Cornell in 2008, he has initiated several projects with New York's grape and wine industry as part of a broader program to enhance the market opportunities for horticultural products and benefit producers, processors, distributors, and consumers.

How and when did you become interested in working with the grape and wine industry?

I am an applied economist with a primary focus on food marketing and distribution. My goal is to conduct timely, problem-driven research combining quantitative marketing and microeconomic tools. I became interested in working with the grape and wine industry when I arrived at Cornell back in 2008. The grape-wine value chain is a fascinating, high-value supply chain that generates many economic benefits for the New York state economy. In the wine industry, one is able to explore all topics relevant to economics and marketing, from seeking business models that minimize production costs to elaborating smart brand strategies (e.g., price, product, promotions and distribution) tailored to specific consumer segments.

What big questions are you trying to answer through your research, and what small questions have you answered?

The large scale questions include what are the determinants of success for wineries located in growing wine regions, what are the drivers of customer satisfaction in wine tasting rooms, and does higher customer satisfaction lead to increased sales performance?

We were able to answer some of these questions in a study of Finger Lakes wineries. We found that among all aspects of the tasting room experience and environment, excellent service and a suitable tasting room protocol have the largest positive impacts on customer satisfaction. In addition, converting a visitor from 'satisfied' to 'highly satisfied' pays off: this visitor is likely to buy one additional bottle of wine, spend additional $10 on wine purchases, and has a very high probability (92%) of purchasing wine again.

How will your research benefit the grape and wine industry?

My research is intended to help grape growers and wineries make appropriate business and marketing decisions, from designing superior contracts between grape growers and wine makers to selecting profit-maximizing distribution channel strategies.

Most of your research is on crops other than grapes. Are there results that could be of interest to the grape and wine industry?

Yes! An important aspect of my research program is to help food producers and distributors select profit-enhancing distribution strategies. For example, in the case of wineries, a critical question today is: What is the optimal combination of distribution channels in terms of the share of wine sold through the tasting room, distributors, restaurants, direct shipping, liquor stores, and special events? What is the long-term profitability of each distribution channel?

What is your favorite part of your job?

My favorite part of this job is interacting with grape growers, as well as wine makers, marketers and distributors.