The Sideways Effect - A Test for Changes in the Demand for Merlot and Pinot Noir Wines

The movie Sideways (trailer here) was mentioned several times during the first week of class in reference to its impact on US wine consumption. Specifically there is a wide held belief that the movie resulted in a boom in Pinot Noir sales at the expense of Merlot.

I've heard a similar story from a number of local winemakers and I wanted to see whether there was any hard research which supported this belief. It turns out there is.

A research paper published by the Sonoma State University in 2009 looked at The Sideways Effect (link). I've included a couple of interesting conclusions from the paper below. It seems that the impact on the Merlot market may be slightly exaggerated, but that the positive impact in Pinot Noir was very real indeed.

"Our results suggest that Sideways did have a small negative impact on the consumption of Merlot while increasing the consumption of Pinot Noir. However, far from having a “devastating” affect, the positive impact on Pinot Noir appears greater than the negative impact on Merlot"

"We observe a similar effect with respect to price. Following Sideways, the price of Merlot continues an already decreasing trend, while the price of Pinot Noir reverses a decreasing trend and increases following the movie"

"Our results show that the negative effects of the movie on Merlot were confined mostly to the lower priced segment, under $10 per bottle, while at the higher price points, the movie may have had a positive impact or at least slowed the rate of decline. The effects on Pinot Noir, on the other hand, were positive across all price points, with the largest impact being on the highest price point of $20–$40 per bottle."