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An Innovation in the Wine Closure Industry: Screw Caps Threaten the Dominance of Cork

Mortensen, Wayne and Marks, Brian (2002) An Innovation in the Wine Closure Industry: Screw Caps Threaten the Dominance of Cork. Working Paper. Victoria University, Melbourne, Australia.

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Abstract

Cork stoppers became the industry standard for wine bottle seals probably going as far back as the 1600s. Manufacturers of alternative wine bottle seals have made several attempts to wrest market away from cork manufacturers, particularly over the last thirty years. In spite of these efforts, cork remains the dominant wine bottle seal, with a market share of around 90 per cent. This paper examines the threat to cork manufacturers of one innovative product, the screw or twist top wine seal. Developed in the late 1950s and thoroughly piloted and tested in the market in Australia in the 1970s, the screw top seal was largely a failure, despite the commitment of a group of Australian winemakers to what they believed was a technically superior product. While Australian wine makers abandoned the screw top experiment in the early 1980s, a second attempt by a small number of wine makers from the mid 1990s has captured the attention of the wine industry internationally due to its initial success. What unfolds in this paper is a fascinating story of a product that on many performance attributes outperforms the cork seal, but has so far failed to gain mainstream market acceptance from retailers and end consumers. Although there have been scores of articles in wine and food magazines that have discussed the merits of cork versus alternative seals, we are not aware of any literature that has evaluated the contest through the lenses of innovation theory. In so doing this paper analyses why the initial product launch of the screw top was unsuccessful and why the recent second attempt may indeed be a turning point for the screw top wine bottle seal. The paper is divided into five sections. Section one provides a brief overview of the nature and history of cork as a wine seal. The growing dissatisfaction with cork as a wine seal is outlined in section two. Section three provides the background to the development of the screw top wine seal and its launch in Australia. In section four we explore with the aid of technology adoption innovation theory why the launch was a failure. We then outline in section five the second recent attempt by Australian wine makers to gain market acceptance for the screw top. We will see in this section there are a number of factors that have changed between the first launch and the second launch. Section six focuses on the question as to whether the second attack on the industry standard will be successful. We conclude that innovation theory can both explain why the first launch failed and why the second launch may indeed be successful in the long run. In particular, Moore's (2001) adaptation of the technology adoption life cycle model, although originally developed from experience in hi-tech industries, aided in understanding the key reasons for the initial failure of the screw cap and also in predicting the early success of the screw cap's second attack.

Item Type: Monograph (Working Paper)
Uncontrolled Keywords: wine closure industry; screw caps; cork
Subjects: Faculty/School/Research Centre/Department > School of Management and Information Systems
RFCD Classification > 350000 Commerce, Management, Tourism and Services
Depositing User: Mr Angeera Sidaya
Date Deposited: 04 Jun 2007
Last Modified: 23 May 2013 16:37
URI: http://vuir.vu.edu.au/id/eprint/180
DOI: 18
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