It's only plonk if you look at the price tag
According to the industry blog The Wine Economist, the wine retailing industry's "dirty little secret" is that we automatically lean towards dearer brands. On the hunt, we look at least for a mid-range bottle, irrespective of other dynamics, swayed by the brainwashed belief we should spend proper money. Nobody wants to look crass.
Our unease about buying plonk is exploited by supermarkets. Cheap brands are shelved near the floor, forcing anyone who feels moved to buy an everyday table wine to stoop - so demeaning.
The contrarian case for still taking the low-rent road and picking plonk is anchored in an anecdote about wine tycoon Ernest Gallo. The Wine Economist recounts how, during the 1930s, Gallo poured a customer two glasses of wine, saying that one sold for 5¢ and the other for double. Both were the same, but guess which the customer chose - the 10¢ one.
"Clearly, the customer wanted to buy an identity - the image of someone who wouldn't drink that 5¢ rotgut - even if he couldn't actually taste the difference," The Wine Economist says.
The mystery client's suspect belief that pricey wine has more class than its low-cost counterpart is widely shared, science shows.
In 2001, the cheeky University of Bordeaux researcher Frederic Brochet ran two experiments. In one, Brochet tested the impact of labelling, presenting the same Bordeaux superior wine to 54 volunteers in two different bottles: one fancy, one plain. Duly duped, although they were tasting the same wine, the volunteers ranked the wine from the "expensive" bottle higher than the wine from the "cheap" bottle. In the second humiliating test that underlined the depth of consumer naivety, Brochet had 54 volunteers taste white wine dyed red with food colouring. Incredibly, all failed to sense it was fake.
Further evidence that we are blind about wine comes from the California Institute of Technology (Caltech). In a 2008 Caltech study, 20 volunteers connected to brain scanners sampled a range of wines.
The Caltech study showed that our brains feel more pleasure when we think we are drinking a $45 wine instead of a $5 bottle - even when the vino is the same.
It gets worse. In 2011, a British psychologist devoted to exposing the frailties of human perception, Richard Wiseman, ran a double-blind wine test featuring stock ranging from a $5 Bordeaux to a $50 champagne.
The 578 experiment participants rightly identified pricey varieties only half the time - the same level as guesswork. Go for the plonk, Wiseman advised.
Wiseman's subversive findings spurred former Wired writer Jonah Lehrer to say that, if pricey wines taste no better, then the wine sector has no business model. "It's yellow tail all the way down," Lehrer wrote.
Clearly, the case for spurning that costly vintage fancifully linked with some chateau is strong - it might well taste like vinegar.
Worse, the pate that accompanies your fancy wine could be just as dubious. A 2006 study published by the American Association of Wine Economists found that most people cannot tell pate from dog food. Remember that the next time you seek a snack to go with your snobby grand cru.
Frequently Asked Questions about this Article…
Surprisingly, price often doesn't match taste. Multiple studies cited in the article — including Frederic Brochet's experiments (2001), a Caltech brain-scanner study (2008) and Richard Wiseman's large double‑blind test (2011) — found that people rated the same wine higher when told it was expensive and failed to reliably pick pricier bottles in blind tests. In short, perceived quality is strongly influenced by price labels, so price alone isn’t a guaranteed indicator of better taste.
Packaging and labeling have a big effect. Brochet's 2001 experiment presented the same Bordeaux in a fancy bottle and a plain bottle; volunteers ranked the 'expensive' bottle higher despite identical contents. The article also notes supermarket tactics and anecdotal stories (like Ernest Gallo's 1930s demonstration) showing people use labels and presentation to form identity and status impressions when buying wine.
Yes. The article points out that supermarkets exploit shoppers' unease about buying cheap wine by shelving low‑cost brands near the floor, which subtly discourages purchase and nudges buyers toward mid‑range or premium bottles. That kind of retail placement is part of how pricing and perception shape consumer choices.
For investors, the takeaway is that branding, marketing and retail strategy can create real pricing power independent of intrinsic product quality. The article highlights how identity and perception drive purchases — a strength for well‑marketed brands and a potential vulnerability for products relying only on quality. Critics (like Jonah Lehrer, quoted in the piece) even argue that if premium wines don’t taste better, the sector’s premium pricing model could be fragile.
Not reliably. The article cites several experiments showing people struggle: Brochet's participants were fooled by identical wines in different bottles and by white wine dyed red; Wiseman's 578‑person double‑blind test found participants identified pricey varieties only about half the time — essentially guessing.
The article makes a strong contrarian case for going cheap: if price often drives perception more than taste, choosing lower‑priced wine can be a sensible, value‑oriented choice for consumers. For investors, it signals that low‑cost brands can still meet demand and that value plays an important role in the market — though the article doesn't offer investment advice, just evidence that cheap wine can satisfy consumers.
A 2008 Caltech study mentioned in the article used brain scanners and found that people’s brains registered more pleasure when they thought they were drinking a $45 bottle versus a $5 bottle, even when the wine was identical. That shows price labels can literally change the brain’s experience of taste.
Yes — the piece also references a 2006 study published by the American Association of Wine Economists which found most people couldn't tell pâté from dog food, underscoring how unreliable our taste judgments can be. Together with the wine experiments, these studies highlight how perception, marketing and context often trump objective quality — a useful lens for evaluating consumer businesses.
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