Dominant business model in the Prosecco industry: a resource-based analysis

Abstract

Purpose This study aims to explore the emergence of the dominant business model in the Prosecco realm and its long-term viability. Using the resource-based view, the authors investigate the distinctive characteristics of the dominant business model, identifying the strategic resources combination that drive superior performance. Design/methodology/approach The authors collected a panel data set of Prosecco producers, accounting for more than 70% of the total Prosecco production, encompassing production volumes and financial statements over eight years, from 2014 to 2021. Using a multivariate regression analysis, the authors tested whether being a trader is associated with better performance and thus represents a dominant business model. Findings This study’s analyses indicate that being a trader is associated with superior revenue growth and a more robust return on invested capital. The authors showed that being a trader constitutes a dominant BM, and they identified the role of strategic resources, both tangible and intangible resources, in shaping the success of the dominant BM. The company’s scale and the proportion of profits attributed to Prosecco sales are also influential. Practical implications Empirical analyses reveal that traders favourable performance can be attributed to their efficiency in exploiting tangible fixed assets investments and ability in leveraging investments in intangible fixed assets, effectively harnessing the advantages of brand identity and advertising expenditure. Originality/value Though dominant, the traders’ model in Prosecco faces long-term risks: product standardization, reduced innovation because of price competition and growing threats from imitators, which could gain ground with better industry coordination. Integrated producers, focused on quality and product differentiation, can play a pivotal role in defining the innovation path, sustaining product positioning and retail prices.