Whilst our main focus remains on the South African domestic wine market, Anneke and I had the privilege of participating in the recent VinExpo Asia wine show in Hong Kong. We have previously done 2 Hong Kong International Wine & Spirits Shows plus 2 wine shows in Guangzhou, as well as an IWC special tasting in Shanghai. We were on the Wines of South Africa booth (pictured below).
What do we have to show for our efforts thus far? Not much really. A number of smaller orders of a few palettes here and there. Our Boet Erasmus and Viognier wines are most popular. It is a very tough market to break into due to the head start enjoyed by the French, plus free-trade agreements between China and the likes of Chile, New Zealand and I believe Australia.
Why do we keep trying? The Chinese wine market last year consumed more than 150 million 9L cases of wine, nearly half of that consumed by the largest market for wine in the world – the USA. The Chinese market for wine is growing really fast (imports up more than 70% last year) and the market is still in its infancy. The European markets are slow and local producers get a lot of EU help, making it tougher for imported wines. So we have to go to China, learn and update our plans for such an important market going forward.
To put yourself into the typical Chinese consumer’s shoes, and understand exactly why it is so tough, I took this photo of a spirits section in a Chinese shop. On the top row there are some imported brands and I could figure out what was on offer. Below them it becomes impossible to figure out unless you can read Chinese! How do you decide what to buy?
It is critical to realize that to the vast majority of Chinese wine buyers, our wines look exactly the same to them. Apart from images, colours and numbers, they cannot read anything also on the labels or packaging! Can’t read the wine names, the cultivars, country nor region of origin, nor competition name on any medals.
That makes it extremely difficult to communicate with the local wine buyers. It is just as hard to try follow up by email or phone call without the translator present. So much for most of the leads that cost so much to generate.
We are now working on Version 3 of the Vrede en Lust China plan. I can’t really disclose too much in a public space like this, given that competitors also read the blog, but I will say that less is more. We will go to a 1 wine strategy for the Chinese market and focus on 1 of the 22 provinces. We don’t have enough wine for the whole of China anyway, nor enough money to try and market to the whole country.
In addition we will employ a full time person fluent in Cantonese, Mandarin and English on the ground in China, store the selected wine in a bonded warehouse so that we can supply the wine on a CIF basis (the Chinese buyers prefer CIF to FOB Cape Town!), And if that does not word we will work on Version of the Vrede en Lust China Plan. I do feel good about this version though!