Thu 31 May 2012
Getting in on the action: After France's success, California and Australia are eying up the Chinese wine market.
China's interest in French wine is undeniable. Since duty on imported wine was abolished in 2008, Hong Kong has been ordering Bordeaux wine in droves.
Last year, the country imported 117.9 million litres of wine from France, a rise of 73.9 per cent year-on-year. But is it now the turn of other wine regions to tap into the ever-growing Chinese wine market?
Evidence shows that there is plenty to go around. Hong Kong's secretary for commerce and economic development Gregory SO Kam-leung recently told The Drinks Business that Hong Kong recorded wine sales of $1.2 billion (£77 million) last year and brings in the most value from wine auctions than any other country (totalling $229 million in 2011).
"China is now the fifth largest wine consumer in the world, and it is believed it will increase by 54 per cent in 2013," he said.
After France, Australia is the next biggest exporter of wine to China. Figures from the Australian Bureau of Agricultural and Resource Economics and Sciences show that the market reached AU$181 million (£113 million) in 2010-11.
However, it has somewhat of a bad perception from Chinese consumers that Australian winegrowers will want to change. That is, that Australian wine is cheap and of lesser quality.
Speaking recently to news.com.au, Professor Zhangyue Zhou, director for the Centre for AusAsia Business Studies at James Cook University, said Australian winegrowers should promote expensive wines in China to improve its image and take advantage of the growing market.
"As a country we are not doing a good job of promoting our wine to the Chinese market," he told the news provider.
The country's neighbours New Zealand are also hoping to get in on the act, but financial services provider Rabobank has warned local vineyards that they should target the Chinese market differently, namely catch younger, more affluent consumers in Asia.
And with the rush of brands coming to market, the company recommends that winemakers promote themselves together as a New Zealand brand.
Indeed, this is something that France is doing as well. Despite its dominance in the Chinese wine market, newly elected French president Francois Hollande has announced he will promote French wine in China beyond traditional Bordeaux, but by incorporating 400 different wines from 12 regions across France, in order to encourage consumers to expand their horizons and try something new.
The task could be difficult. Chinese consumers are developing their own tastes for new wines, with California also competing to grab a share of the market.
Again targeting the high-end consumer, Californian winemakers are marketing their top quality vintages, although sales are getting stronger for mid-level brands as well.
"We try to be in all of the same places as all of the other important wines of the world and right now China is attracting so much attention," Don Weaver from Napa Valley's Harlan Estates told the Associated Press.
"Trying to solve the China puzzle is the most exciting part of my job right now."
Marketing campaigns have been run in China by the Californian wine industry and to boost their efforts even further, the California Wine Institute has recently set up an office in China, which will run wine promotional activities in the country and even target the Californian lifestyle to consumers.
If the importance of China to the global wine industry was not clear enough, the Vinexpo wine and spirit trade event, which was held in Hong Kong from May 29th-31st, should be.
Visitor numbers from the first day were 38 per cent higher than its last event in 2010 and it is expected that as many as 15,000 people could walk through its doors over the three days.
It saw over 1,000 companies, producers and exporters from 28 countries vie for space in the Chinese market hoping to take home just a slice of France's success.
