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Chinese sip stronger taste for imported wines

Editor: Li Kun 丨CCTV.com

11-13-2015 17:12 BJT

By Tom McGregor, CNTV Commentator

The Chinese, especially the youth are growing richer, more consumer-oriented and cosmopolitan. With rising discretionary incomes, they shop for more fashionable clothes and accessories, travel overseas and stay in tune with Western customs.

 

Imported wines are getting trendy, particularly for the Chinese Middle Class, who mainly reside in metropolitan areas. French wines are the most popular, but Italian, Spanish, German, Australian and Chilean wines are grabbing a larger share of the market.

Wine importers and leading experts in Asia have gathered at the one-day ‘Wine in China Conference’ in Shanghai, hosted by Debra Meiburg, founder of Meiburg Wine Media and organized by Shanghai-based Wine Contor, a boutique B2B (busines-to-business) importer.

Luring Middle Class drinkers

Simon Zhou, founder of Ruby Red Fine Wine, recounted China’s boom days before the 2008 Financial Crisis erupted. “A few wealthy patrons would look at our stocks and then buy over $US50,000 worth of wine in one trip,” Zhou told CNTV. “We gave them VIP treatment.”

However times have changed. Zhou noted Middle Class customers are beginning to dominate the market. “They are simply looking for the wine experience for status,” he said. “They want more diversity of brands and are more price conscious.”

Wineries should consider targeting them with mid-priced wines, selling in a 51-120 RMB price range, while those living in the Top 1 Tier cities - Beijing, Shanghai, Shenzhen and Chengdu - are willing to pay more.

But, Zhou said supermarket chains in China are not offering a wider selection of wines with more competitive pricing for Middle Class consumers. “Supermarkets only work with one or two importers and ignore everyone else,” he said.

Shenzhen: The Hot Zone

Many wine importers are hailing Shenzhen as a premier city for operations. It’s located near Hong Kong, recognized as the wine market hub of Asia, due to no tariffs or taxes imposed on imported wines.

Yet, Hong Kong importers face an over-capacity crunch. Shipping the glut to Shenzhen appears the best option, making deliveries via cargo shipping, vehicles, rail and air freight. After Customs’ clearance, numerous distribution channels are available to transport bulk wine to anywhere in mainland China.

Nevertheless, the Chinese government has recently enforced tougher regulations on imports. “The Customs-inspections-quarantine (QIR) documentation is much more difficult and time-consuming,” said Jacky Shao, director of IT and Supply Chain - ASC Wines.

He added, “To receive certification for distribution, more detailed information on received goods are required, while tax registration has gotten more complicated.”

Wines trending in China

Before imported wines became popular in China, many Chinese drink home-grown wine. “But Chinese wine usually has a sweet taste,” Julie Chongli Liu of QuQu International said. “Drinking Italian wine is a different experience for them.”

And as their taste buds turned more towards imports, they first bought French wines, but later got more educated. Many participated in wine-tastings, visiting wineries at home and abroad, and signing up for WSET (Wine & Spirit Education Trust) certification programs.

Wines from other nations, such as - Germany’s Hattenheim Schutzenhaus Rhengau Riesling Kabinett and the Chilean Calcu Gran Reserva Cabernet Sauvignon, Colchagua - have captured the hearts of more connoisseurs.

Spain wineries have witnessed rapid growth in the China market in recent years as well, while those who still prefer a sweet taste can select the Canadian Bacco ice wines.

Getting the word out

The wine business can be lucrative in China, but Thilo Fuchs, co-founder of Shanghai-based Bottlesxo, said, “Wine importers must get more tech savvy. They have to use WeChat and other Social media platforms to connect with Chinese clientele.”

The quality of imported wines and prices are declining; more Middle Class families mean more volume buying nationwide, but it’s a more competitive market. It’s essential to conduct promotions to entice new customers, including wine-tastings and education forums.

Accordingly, as more Chinese learn the value of drinking fine wine, they will become more loyal to certain brands or the countries they originate from.

Tmcgregorchina@yahoo.com

 

( The opinions expressed here do not necessarily reflect the opinions of Panview or CCTV.com. )

 

 

Panview offers a new window of understanding the world as well as China through the views, opinions, and analysis of experts. We also welcome outside submissions, so feel free to send in your own editorials to "globalopinion@vip.cntv.cn" for consideration.

Panview offers an alternative angle on China and the rest of the world through the analyses and opinions of experts. We also welcome outside submissions, so feel free to send in your own editorials to "globalopinion@vip.cntv.cn" for consideration.

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