The state of wine retail in Beijing
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La Cava |
Jim Boyce
Grasping the wine retail market in China – with its fuzzy numbers and
dizzying range of importers, producers and distributors – is akin to
holding a greased Jeroboam. With one hand. While riding a roller
coaster. Just surveying the thousands of companies that have imported
wine this year alone, or the equally daunting number of emerging retail
outlets, is enough to drive a person to drink.
While the market is a bit cloudy, it is also going
through an exciting evolution. A two-year government austerity campaign
has shredded orders from officials and state-owned companies – a
significant portion of overall sales – and thus forced a greater focus
on consumers at large. Add rising personal income, a soaring e-commerce
sector, and increasingly savvy smart-phone-armed buyers and you get a
billion-bottle market on the rebound, with plenty of potential.
One of the most dynamic sectors of the market is online
retail; many importers and distributors have websites that sell direct
to consumers.
The Wine Republic
Since its founding in 2008, wine-importing company The
Wine Republic has gravitated toward a ‘cool climate’ theme, with over
two-thirds of the current portfolio consisting of such labels. They hail
from over a dozen places, ranging from Kamptal, Kremstal and Vienna in
Austria to Yarra Valley, Coonawarra and Tasmania in Australia, with
additional brands from France, Germany, Italy and New Zealand.
“Yering Station from the Yarra Valley is a good example
of what we’re about,” says co-owner Campbell Thompson. “Elegant wines
from a family-owned producer.” Other leading brands include Loimer,
Wieninger, Maison Champy and Mt Difficulty.
Consumers can buy the wines via the company website
(thewinerepublic.com), with free delivery in Beijing, Shanghai and
Shenzhen, or a small fee to other cities. Wines are also sold online via
FirstCellars.com and TRB (trb-wine.com) and in shops like Pudao in
Shanghai and Beijing.
“There is a noticeable shift away from the big
‘supermarket’ wine brands, as information-enabled Chinese consumers
expand their horizons,” says Thompson. “Many of our retail customers
have also traveled to Australia, New Zealand, Burgundy or Germany, and
developed an interest in these wines.”
Pasion
Pasion has increasingly gained a place in the hearts of
Spanish wine fans since it launched in 2012. The portfolio has grown
from 15 labels from four wineries – including two from co-owner Alberto
Pascual’s home region of Ribera del Duero – to 90 labels from around
Spain. Pasion supplies a number of retailers such as Taste Spain and La
Cava de Laoma.
However, consumers can buy wine directly from Pasion’s
website (pasionbj.com), from their showroom in Beijing, and from the
company's soon-to-relaunch online shop. Co-owner Andrea Skubinn says
buyers tend to already know what they want. “Many lovers of those kind
of wines do know the wines, maybe from trying them in other countries,”
she says. “Some really ‘search’ for them or have tried them in the
restaurants or hotels with which we are working.”
She notes that while region, grape variety and
uniqueness are key when adding new wines, price has become increasingly
important. “Clients in China are becoming more and more price sensitive
and know how to check prices elsewhere via the Internet,” says Skubinn.
Pinotage
Few people in China have introduced as many consumers to
South African wine as Toby Cao. He has been importing wine since 2005
and carries over 100 labels from 20 producers, including Rooiberg,
Simonsvlei, Dornier and Van Loveren. Sales come via two
restaurant-and-retail venues called Pinotage – one in central Beijing
and one in the suburbs – where customers can also enjoy South African
fare like biltong, boerewors and ostrich burgers. Pinotage has promoted
its wines by pitting them in tastings against other nations, hosting
visiting winemakers, and organising South Africa-style barbecues known
as brai.
Pinotage developed a mobile app last year that allows
consumers to both learn about South Africa’s key regions and to order
wine. Cao says that he delivers his wines throughout the country and
most buyers still prefer to order by phone or email, but that he expects
sales via the app to quickly grow this year.
CruItaly
Xiaofu Ecommerce Group set its sights on diversifying
beyond IT three years ago and saw an opportunity in promoting Italian
lifestyle products, including wine. The result is CruItaly
(cruitaly.com), a project with the added benefit of savings on the
company's annual rmb10m ($1.6m) corporate wine budget.
“Our main purpose is to develop an online sales platform
supported by our retail outlets,” says managing director Rory Quirk.
“We have a mobile application, an e-commerce store, a WeChat store, and
soon will be opening a Tmall flagship store.” (Tmall, or Taobao Mall, is
a business-to-consumer site, while Taobao is a customer-to-customer
one. WeChat, or weixin, is a wildly popular social media app.)
The retail outlets include an Italian Cultural Centre in
downtown Beijing, with similar centres under construction in Shanghai,
Guangzhou and Chongqing, slated to open by year’s end, says Quirk. The
centre partners CruItaly with a cafe called Al Bar Italia, as well as
the Embassy of Italy, which runs a visa centre one floor up.
CruItaly’s portfolio includes brands like San Leonardo,
Feudi di San Gregorio and Tasi, and Quirk notes that more lower-priced
options are on the way from Puglia and Sicily, the result of a
promotional project being funded by the European Union.
“For private clients, personal service is more important
considering they purchase higher-end wines, so having the shop is very
helpful,” he says. Quirk also says it’s crucial to link the wines with
other Italian products such as coffee, kitchenware and fashion. “We know
if we promote wine on its own, it will be tough,” he says. “This is our
way of differentiating ourselves.”
La Cava de Laoma
This Chilean wine shop opened two years ago in a Beijing
mall with low foot traffic and some wondered how long it would remain
standing. A steadily growing number of regulars, a reputation for fun
events, and a portfolio since rounded out with a few Spanish, French,
Portuguese and Chinese options have helped it beat the odds.
Key brands include Maquis and Calcu, with owner Mariano
Larrain having family connections to both, as well as Villard and Domus
Aurea. The portfolio appeals to budget shoppers, with bottles from
rmb50, and those seeking something beyond the Cabernet and Carmenere
typically associated with Chile, such as Syrah and Pinot Noir options.
Consumers can buy via the shop, the La Cava store on weixin, or online
retailers such as TRB.
Larrain says that the gifting market is still
significant, and French wines remain the first choice, making it hard to
convince customers to pay for better-quality Chilean wines, although he
does see growing curiosity. His target customers at the shop are young
professionals comfortable with spending rmb80 to rmb200 per bottle and,
once trust is established, exploring from there.
Online sales are more price sensitive, he says. “My plan
in the coming months is something like rmb100 for two bottles of good
quality wine.”
CHEERS
Since evolving from a business-to-business distributor
in 2012, this wine shop chain has grown to 13 outlets in Beijing,
inspiring several imitators. This year it expanded to Chengdu, with
Shanghai to follow soon. What makes CHEERS special is not that it offers
wines at low prices by China standards, starting from rmb50 per bottle,
but that it also serves its fairly young clientele with fun. That
ranges from its cheerful decor and quirky videos to events such as
comedy shows, live music and Sangria-making classes.
“We are more than just a wine store,” says co-owner
Claudia Masueger. “We interact with our customers. We introduce our
products through wine-tasting parties, shows, and many other
activities.” Masueger also says she notices that more customers are
finding their entry point to wine through bubbly. “For new wine
drinkers, it’s an easy entrance to the complex wine world,” she says.
“They develop the taste after a while and then start to try the rest.”
CHEERS stores stock up to 85 wines, half of them priced
at less than rmb100 per bottle, and sales are projected to top 500,000
bottles this year. The chain also sells its wines and spirits via a
Tmall store.
Everwines
Everwines, the retail branch of Torres China, is not a
specialty retailer per se but is somewhat special in using every retail
route possible to connect buyers to its 75 brands. Drawn from 13
countries, these include Taittinger, M. Chapoutier, Henschke, Chateau
Ste. Michelle, Salentein and well-regarded local producers Grace and
Silver Heights.
Torres has opened Everwines bars and shops in a dozen
cities, including Beijing, Changsha, Chengdu, Foshan, Guangzhou,
Hangzhou, Nanjing, Nanning, Shanghai, Shenzhen, Xiʼan, and Wuhan, as
well as wine counters in Hola stores around the nation. It has paired
these with an online Everwines shop. Sales from these outlets represent
7% of total turnover, says managing partner Alberto Fernandez.
Torres has also partnered with major retailers. On one
hand, that means selling via hypermarkets such as Metro, Wal-Mart and
Sam’s Club, and high-end supermarkets such as Olé, among others. On the
other, it means leveraging e-commerce platforms, from huge online
players like yesmywine.com to shopping channels like Hunan TV to a
flagship store on Tmall.
Torres also signed a deal with COFCO, the massive
state-owned company best-known for the Great Wall Wine brand and less so
for niche producers Junding, Yunmo and Sun God. COFCO will use its
extensive network to sell Torres’ Coronas and Gran Coronas brands, as
well as select products from Baron Philippe de Rothschild. “We hope to
be part of their massive retail expansion in China,” says Fernandez. “As
producers it is an honor to dig deeper and faster in the China market
through their vast networks.”
Others of note
This just scratches the surface of retail wine in China.
Plenty of niche importers are finding avenues for their products,
either online or in shops, whether it is Australian Natural with its
organic wines, La Seine Belle wines with its growers’ Champagne, or DS
Wines with its largely Spanish portfolio. As the China scene continues
to diversify, we can expect to see more companies focus on wines of a
certain country, region, style or grape variety. This only goes to
underscore what people in the wine trade have long known, namely, that
China is best seen not as one market, but as many, and that there are
many possible routes to retail success.
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