The Role of Sustainability in Enhancing Place Performance Through an Identity-Based Approach to Place Branding

Abstract

Preventing the environmental impacts of economic growth is an important goal in today’s marketplace. This concern for a sustainable future incentivises marketing based around sustainability. The food and beverage industry had its fair share of criticism as its production uses more natural resources than most industries. One industry that has been ahead of other food processors in adopting environmental practices is the wine industry. The close relationship between wine and places is undisputable and so strong that people frequently visit places of wine production in the form of wine tourism contributing significantly to regional economies. For wine to be associated with sustainability, regional stakeholders would be required to represent similar values. The branding of places is far more intricate than branding of products and needs the support of those stakeholders involved. Such support is often discussed as a shared place identity. Only limited previous research has addressed whether the communication of sustainability enhances business performance. No research to date has empirically tested whether a shared stakeholder identity influences the relationship between sustainability branding and business success. To close this gap, a sequential mixed methods procedure was specified using quantitative questionnaires with 420 subjects and 20 qualitative interviews. A model with consequences of sustainability branding and a shared place identity was established using extant research. Mostly existing scales were adapted to fit this research context and tested with a structural modelling approach among Australian and German wineries. It was found that practicing and communicating sustainability significantly influences performance on an individual winery and regional destination level. Furthermore, a shared place identity has been established as a critical success factor in the relationship between sustainability branding and place performance. Both theoretical and practical implications can be drawn from this research. The results have provided empirical evidence on the direct relationship between sustainability and performance, in addition to the moderating role of a shared place identity. These findings extend the tourism literature which states that businesses practicing sustainably, enhance their own performance as well as the overall regional performance. It also extends stakeholder theory by establishing that a shared place identity strengthens this relationship even further, highlighting the need for regional management to initiate a shared sense of identification. Practically, regional managers who are eager to enhance economic performance should be actively involved in developing relationships between the individual wineries and the regional management in order to foster a shared place identity. Furthermore, it is of major importance to establish positive attitudes toward sustainability among winery owners. This can be done by building the confidence of winery owners by offering infrastructures for learning and support about sustainability.