Forecasting the development of wine tourism: a case study in Chile

Purpose - The number of wine tourists in Chile is still small even though investment in infrastructure, like cellars and wine routes, has been made in the last five years. A question is important to be answered at this point: is there a market for wine tourism in Chile, did the industry overestimate its potential? The lack of historical data impedes an evaluation of these questions. The purpose of this paper is to forecast the size of the local wine tourists market in Chile and provide with recommendations to its development. Design/methodology/approach - The paper consists of the application of a diffusion model to forecast development paths for Chilean wine tourism market. The model is populated with information obtained through surveys to those demographic segments identified as more closely involved with wine tourism based in Charters and Ali-Knight. Findings - Chilean wine industry has been developing its infrastructure in wine tourism for a number of years, but the number of wine tourists is still very low. Behavioral factors like local consumers' behavior, especially the high level of forgetting (an average wine visitor will perform only one visit to a winery) that reduces the effect of word-of-mouth, hinders the development of wine tourists. Wineries should aim to maintain a constant level of awareness among wine tourists in order to obtain repeated visits and encourage word-of-mouth as suggested in Dodd. Research limitations/implications - Forecasting models depend on the variables employed. Consequently the results are affected by the certainty of the values of the variables, as well as their level of exactness. Even though surveys are employed to obtain the values of the variables for the model, there are no historical data to validate the results. Originality/value - The paper presents a forecasting model to identify the development of wine tourism instead of only reporting actual or past results. Therefore, the paper adopts a forward-looking perspective for analyzing wine tourism market size differently than previous approaches (see Mitchell and Hall for a review). The model also supports policy recommendations.