A Hedonic Analysis of Wine Menu Pricing in Canada: A Study of Toronto Restaurants

Abstract

Consumer demand for wine in Canada is changing. Wine sales in licenced establishments are increasing relative to direct purchases from retail stores, and consumer preference may be changing toward domestically produced product. These changes have not yet been examined. In this study, a hedonic analysis of restaurant pricing of by-the-glass white wine in Toronto, Canada is used to understand current trends and inform emerging Canadian producers. Data on wine level and restaurant level characteristics for 396 by-the-glass offerings from 66 Toronto restaurants were collected. Results indicate that region, varietal, restaurant capacity, affiliation/ownership structure, online restaurant rating, and neighbourhood significantly determine prices in this market. The results of this study will be of use to Canadian restaurateurs and members of the wine industry, particularly producers looking to expand sales in urban markets.