Market shaping through controversial innovation

Abstract

In this paper, we examine market-shaping literature that investigates how markets evolve over time. We focus on how controversial innovations gain acceptance as the result of the intentional strategies put into place by companies. We’ve carried a qualitative research based on secondary data collected from several online sources. Our study describes how a new packaging, can, had been introduced to the highly conservative market of wine in France. Our findings shed light on the opportunity for practitioners to implement controversial innovation in conservative markets and introduce a set of strategies to achieve such purpose.

Keywords

controversial innovation Gioia method market shaping qualitative research wine market

Introduction

“The bottle does not matter as much as the drunkenness,” wrote Alfred de Musset in 1831. However, when wine packaged in cans was first introduced in France in 2008, it was highly controversial and met with severe criticism. Developed in New Zealand, this new packaging for wine first gained a toehold in countries with a comparatively weak cultural legacy of wine consumption, such as in Japan.

Today, the highly conservative French wine market is increasingly receptive to this novel idea. In line with the literature, canned wine may be conceptualized as a controversial innovation (Delacour & Leca, 2017), which aims at breaking the codes of the wine market. This kind of innovation can trigger negative judgments and even revulsion.

Based on insights from qualitative research using a single case study design, we have identified three market-shaping strategies that can lead to the acceptance of controversial innovations: firstly, constructing problem/solution frames; secondly, targeting the fringes of the market, and lastly, aiming to achieve consecration.

Market shaping

From the perspective of emerging literature on market shaping, markets are viewed as socially constructed, malleable, and plastic systems that companies can shape or reconfigure, both individually and collectively (Nenonen et al., 2014). Scholars in marketing have shifted their attention toward studying the interactions between companies and the macro-level institutions of the market (Humphreys, Chaney, & Slimane, 2017). In broad terms, market institutions define the social meaning of consumption and marketing practices (Dolbec & Fischer, 2015). They also ground the basis for social judgment of market actors regarding the legitimacy, status, and reputation of products and brands in a market (Delmestri & Greenwood, 2016).

Central to market-shaping strategies are the efforts made by companies to influence the way consumers perceive, understand, and evaluate market products and consumption practices (Rosa, Porac, Runser-Spanjol, & Saxon, 1999). Consumer cognition is therefore determined by macro-structures or institutions, created in the market, and shaped by companies.

Market-shaping strategies may take several forms, such as market creation, widening, disruption, maintenance, and revival. According to Nenonen and Storbacka (2020), the comprehensive model of market-shaping strategies points to the centrality of the relationship between two major components. The first refers to the individual level of companies, which have to build capabilities and resources geared toward market shaping. The second strategy hinges on a market system that depicts the outcome of market-shaping strategies. Changes in market systems can be understood through three major processes: a significant level of economic activity, growth in the market system and changes in institutional logic in the market (Nenonen & Storbacka, 2020). A significant level of economic activity is achieved as new actors engage with market activity as sellers or as buyers. Such operationalization may be used as evidence in the process of creating, widening, or reviving declining markets.

Market innovation has been depicted as an important driver of market shaping (Storbacka & Nenonen, 2015). According to Vargo et al. (2015), market innovation is achieved when value propositions that bind firms and customers together are reconfigured and transformed.

Building on the hypothesis of market complexity, market-shaping literature espoused a processual perspective to address how markets are shaped. The literature can also identify who may shape the market and how several market actors collectively engage and collaborate to bring about innovation and change. However, there has been little interest in studying the more detailed specifics of innovations that may act as a contingency factor in the process of shaping the market. For instance, controversial or contested innovations (Ben-Slimane, Diridollou, & Hamadache, 2020; Delacour & Leca, 2017) raise moral concerns and challenge our understanding of market-shaping strategies.

Controversial innovations

Given that controversial innovations are perceived as transgressions on established codes, it is difficult to achieve a consensus on their moral values and norms (Delacour & Leca, 2017). They are therefore divisive (Roulet, 2020) and trigger polarizations within the market between opponents and enthusiasts. For instance, the emergence of legal cannabis was a source of controversy in the US, as a new market was created and thus the boundaries between medical and recreative cannabis were redrawn (Dioun, 2018). In their study of the launch of the cardboard coffin in the funeral service market in France, Ben-Slimane et al. (2020) showed how this innovation was met with severe criticism from both customers and suppliers in the market, who viewed it as “disrespect to the deceased.”

Controversial innovations are often tainted with negative social judgments, such as stigma and illegitimacy. Controversial innovations also trigger negative emotions such as disgust, fear, or shame (Almeling, 2007). In order to better understand how innovations can be divisive and trigger controversies, it is important to understand market structure (Delacour & Leca, 2017) and to what extent innovation challenges guarded institutions protected by the elites and other powerful actors (Claus & Tracey, 2020).

Markets with a clear core/periphery structure and stable boundaries are less open to accepting controversial innovation. Codes and norms that are supported by powerful actors and the elites are also more difficult to challenge and to disrupt through controversial innovation.

As with any innovation aimed at shaping the market, controversial innovation must first gain acceptance among a wide array of actors. However, it is challenging to be transgressive and divisive while gaining such wide acceptance, as the proponents of controversial innovation face conservatism and orthodoxy. Market shapers must act as cultural entrepreneurs (Lounsbury & Glynn, 2001) to gain moral acceptance. Broadly speaking, scholars seldom study the ways in which markets-shaping strategies may lead to controversy, and how companies are able to overcome this reaction. Extant research on market-shaping strategies outlines strategies such as changing a market actor’s perceptions about market products, refashioning a product (Dolbec & Fischer, 2015), and eliciting positive emotion toward a market product (Rao, 2004). Few have studied how market-shaping strategies unfold in a context where established market codes are challenged.

For these reasons, we argue that controversial innovation raises questions that are not answered by the existing literature on shaping markets. We therefore formulate the following research question: How do controversial innovations gain acceptance and shape markets?

Case study

This article draws on qualitative and longitudinal research using the case study of the emergence of canned wine in France since 2008. It is widely acknowledged that the wine market in France is highly conservative. There is a clear core/periphery distinction among actors and highly institutionalized market codes embedded in French culture and history relating to wine (Croidieu & Monin, 2010). Market codes are upheld by highly guarded institutions in France. For instance, a law issued in 1972 in Alsace, eastern France, dictates that its wine must be put into bottles whose shape is codified and strictly defined.

Despite the success of canned wine in the US, Japan, New Zealand, and other countries, it has faced severe criticism in France among consumers, wine producers, and wine distributors. The following terms have been used to describe canned wine: “heresy,” “sacrilege,” “capital crime,” and “a shame.” These terms show the controversial character of canned wine, since they reference social codes, rituals, and even the sacred.

Canned wine was viewed as a violation of the prestigious character and the high status of wine within the alcoholic beverages category because cans are mostly used as the packaging for beer. Prevalent in the criticism of canned wine was the emotion of disgust. Other criticisms raised the issue of abandoning well-preserved rituals in wine consumption, such as enjoying the color of wine, the process of opening a bottle using a corkscrew, or even the clinking of wine glasses. There were also concerns regarding the poor quality of canned wine, given that a can does not allow for the micro-oxygenation of wine; this process is indeed crucial to enhancing the aging qualities of a wine.

In the very fragmented and conservative French wine market, an increasing number of brands are working to break its codes by producing canned wine. Neoneon and Storbacka (2020) assume that market shaping occurs when a significant level of economic activity is noticed and/or there is growth in a market system. According to LSA (2021), canned wine can reach a growth rate of 170% per year. Similarly, according to an opinion poll conducted in 2021, more than 25% of the French say that are interested in trying canned wine.

Data description and methods

We have triangulated several types of data in order to identify market-shaping strategies that matter for controversial innovation. First of all, we collected 102 press articles from Factiva¹ using the keywords “wine in can” from national and regional newspapers in France. We also collected 25 pages of customer comments on canned wine products from several sources, such as newspaper websites, Facebook posts and comments on wine selling platforms such as Vivino. Our third source of data comes from 10 videos that showcase canned wine and their producers. We obtained subtitles from videos through the tool DownSub.

For the analysis of our data, we followed the Gioia method that gives a boilerplate for qualitative analysis. Named after Denis Gioia and his team (Gioia et al., 2013), the Gioia method is an inductive and interpretative method based on qualitative data collected from single case studies. The main assumption behind this method is that people we study are knowledgeable agents as they know what they do and can explain their actions and intentions. Gioia Method allows therefore the discovery and the construction of new concepts by giving a voice to agents at an early stage of the analysis by developing narratives based on their quotes and through a continuous iteration of the researcher between what the informants say about their reality and how this may resonate with theory. Thanks to its three stages of interpretation/iteration between data and literature, the Gioia method brings rigor to qualitative analysis and foster the process of crafting new constructs and concepts when using single case studies (Gioia et al., 2013).

We carried out a three-stage coding process, starting with open coding of our data to capture patterns in the actions and discourses used by proponents of canned wine in their market-shaping strategies. During the second stage, we started iterating between data and theory and carried out axial coding to determine how first order codes resonate with the theory on market shaping. The third stage allowed us to identify our three strategies of shaping controversial innovation through an abstraction work based on grouping our second order codes in labels geared toward generalization and decontextualization.

Findings

Our findings highlight three strategies: constructing problem/solution frames; targeting the fringes of the market; and looking for consecration.

Constructing problem/solution frames

This strategy relies mainly on discourse. The goal is to present canned wine as a solution to a problem in order to rationalize its adoption by customers. Three problem/solution frames have been produced in market discourse: the discourse of responsible drinking, on-the-go consumption, and environmentally conscious consumption.

The first consists of framing canned wine as the solution to the problem of alcohol abuse. A single can has the capacity of two glasses of wine (250 mL), equaling a third of a regular bottle of 750 mL. Reducing the volume of a wine container has been advocated by canned wine proponents to promote responsible drinking. A canned wine consumer can enjoy drinking the two glasses of wine permitted by the law for driving. Canned wine thus offers this possibility to easily control and restrict wine consumption.

Secondly, canned wine was deemed a solution to on-the-go consumption. A can is lighter and easier to carry than a bottle, so it is suited to wine consumption at specific events and in certain places. Cans are more convenient for picnics, on the beach and during sports events. Rosé and white wines are the wines that are most often put in a can, and these wines are commonly consumed during picnics, on the beach, or during barbecue parties. Handling bottles made from glass was therefore framed as inappropriate in the emerging trend of on-the-go wine consumption.

Thirdly, thanks to the recyclable properties of aluminum, canned wine could help solve issues related to shortages in glass supply. Aluminum can be recycled several times, which offers the wine industry a type of packaging that is more sustainable.

Targeting “fringes”

This strategy consists of engaging with both customers and winemakers that are at the periphery of the market. The main target customers were young people, thought to be less conservative than their parents and grandparents. These consumers also have more diversified tastes, and drink other alcoholic beverages such as beer, cocktails, and brandies. As customers, the young are less attached to the codes and norms of drinking culture, and more open to novelty and innovation. The design of the can has also been thought to convey the values of fun and simplicity.

The proponents of canned wine have also targeted wine producers who are either on the fringe of the field since they make a less reputed wine, or winemakers who stands against the conservatism of the wine industry and its inertia. French vineyards offer a wide variety of prestigious wine. Evidently, the more prestigious the vineyard, the more conservative the winemaker. What was deemed “impossible” in Bordeaux or Burgundy was a possibility in the vineyards of Beaujolais or Provence. Miss Vicky, a young winemaker who took over her father’s vineyard located in Beaujolais, declared that: “the legacy of the wine industry and the weight of its long history since the antiquity hindered the industry’s ability to challenge itself and to evolve […]. By replacing the bottle with a can, I aimed at making drinking wine simpler, more fun and less intellectual.” Another winemaker who has also produced canned wine confessed that: “I know that I’m breaking the rules; I’m having fun with this.”

Looking for consecration

Targeting the fringe of the market was not the only strategy implemented by proponents of canned wine. The strategy of Winestar, a start-up launched in 2013, was to put premium wine in a can. As concerns about the quality of canned wine have been voiced due to the risk of oxidation, Winestar marketed a new process that protects the wine from the aluminum and maintains its quality and taste. Building on this argument of maintaining the quality and taste of wine in a bottle and wine in a can, Winestar have worked on attracting winemakers from prestigious vineyards. Even though the majority of premium winemakers refused to join in, Winestar succeeded in improving the quality of its canned wine by recruiting some winemakers from Bordeaux. In doing so, they were able to dispel some of the negative images linked to the idea of canned wine. The company had also attended wine fairs and competitions to showcase the prize they won at the London Wine Competition. The wine by Winestar mainly comes from Bordeaux vineyards, among others, which conveys an image of quality and prestige to the consumer.

According to a winemaker from Bordeaux, Winestar offers the potential to increase revenues in a declining market, where sales decrease by 10% each year. Winestar wines are gaining a toehold in several international markets, such as UK and the US, where consumers are more focused on the quality of the wine itself and less attached to its codes and norms.

The increasingly fierce competition that French wine is facing and changes in consumer habits persuaded a few winemakers from Bordeaux and Languedoc to jump on the bandwagon of canned wine. These partnerships have increased the range of available canned wines, with more canned red wines being produced. This goes against the misconception that only cheap and poor-quality rosé wine can be put in a can.

Conclusion and implications for theory and practice

In this paper, we have addressed a central question regarding the market strategies used with regard to marketing controversial innovations: a question that has received scant attention in the literature. Controversial innovations are innovations that break the codes of the market and trigger emotional reactions, such as disgust or fear.

The findings from the case study of canned wine in the highly conservative French wine market highlight three strategies that make an important contribution to the literature on market shaping. In the first instance, our findings bring to the fore the idea of a specific type of discursive strategy that we term the construction of problem/solution frames. Such a strategy aims at rationalizing how consumers can adopt controversial innovation in a market. Whereas the literature emphasizes that the reactions to controversial innovations are often emotional, we show how invoking logical arguments may help market actors consider such innovations from a different perspective, removed from controversy and the idea of breaking codes.

The second strategy is in line with literature on disruptive innovation, which shows that actors on the fringes of a market are more prone to adopting controversial innovations (Ben-Slimane et al., 2020). We enrich our understanding of being on the fringes by shedding light on actors who consider themselves to be outliers or ground-breaking because they go against market codes. Being on the fringes of a market is more than just a position. Instead, it is driven by self-identification; it is the creation of identity by standing out.

Our third finding highlights the fact that controversial innovations should aim for market consecration defined as the recognition of quality and distinctiveness—in order to balance and overcome negative reactions. Product quality and market status are therefore factors that may help avoid a controversial innovation being rejected among market actors. Our findings show that such a strategy works mostly with dominant players in the field who may change their perception of the controversial innovation if there is evidence of its quality, and if this aligns with their interests.

In line with these theoretical contributions, we claim that practitioners may also learn from this study as we show that being divisive and a heretic innovator may be an efficient strategy to shape markets and to create value. Markets are moral orders where moral codes and rules transgression may lead to stigma and sanctions. Theses moral codes are so taken for granted by managers that they hinder them from spotting opportunities of bringing innovations that disrupt the moral status quo. Practitioners who are concerned with unleashing innovations in their organization should be aware of such blind spots. We advocate that managers are subject to moral blind spots in addition to the cognitive blind spots that have already been addressed in previous works.

Needless to say, that such maneuver is replete with risks. However, the three strategies of constructing problem/solution frames; targeting the fringes of the market; and looking for consecration that we provide in this paper may mitigate such risks and enhance the chances of implementing controversial innovations. Our aim is therefore to draw attention of managers on the benefits of being divisive and on how to implement transgressive strategies of breaking moral codes in the market.

Footnotes

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

ORCID iD

Karim Ben-Slimane

Note

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