10 trends for the chinese wine market in 2013

10 Trends in the Chinese Wine Market for 2013 www.chinawinesolutions.com

10 Trends for the Chinese Wine Industry in 2013


Introduction China Wine

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Now officially in the Chinese New Year, we take 5me to recap our predic5ons for

the Chinese Wine Industry in 2013.

In the following presenta;on we briefly outline 10 trends we believe will shape the

Chinese wine industry over the next 12 months.

To con;nue the discussion join us on TwiDer (ChinaWineViews) and LinkedIn

(China Wine Insight).


1. Market Consolidation China Wine

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The current number of wine sellers in the Chinese market is unsustainable. 2013 will see see hard

trading 5mes for most and many will exit the industry en5rely.

According to Radobank, there were 3,863 wine importers in 2011 (and that doesn’t account for the 100’s of unofficial

ones), up 73% from 2010 and up 200% in 5 years. Even in a market the size of China, this number is unsustainable.

Just in the last few weeks, Dynasty, one of China’s largest domes;c wine companies, posted a profit warning amongst

difficult trading condi;ons. The take away from writer Doug Young of the South China Morning Post was ‘A new profit

warning from Dynasty reflects a burs;ng bubble in China’s overheated wine industry, with a major consolida;on likely

to start in the second half of this year’.


2. Changing Expectations China Wine

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China will no longer be seen as a quick win market.

As compe;;on becomes increasingly fierce, the ;me for easy sales and high margins is rapidly becoming

a thing of the past. In recent years, China has been seen by many as the answer to falling margins in

more mature markets.

However, biDer experience is teaching many wineries that doing business here involves a significant

learning curve, high costs and o_en lower than expected volumes.


3. Increased Commitments China Wine

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As expecta5ons change and compe55on increases, wineries will move to take a more ac5ve approach

in the market.

ADemp;ng to beDer understand market trends, establishing a local presence and increasing ways in

which they can engage and influence key stakeholders are already becoming increasingly common.

As part of this, 2013 will see more foreign wineries move to create a presence on Chinese social media.

Companies across various industries are finding social media to be an effec;ve channel to find and

engage their target audience; the wine industry is no excep;on.


4. Online Coming of Age China Wine

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Online wine retailors will con5nue to increase their influence as a major sales channel.

According to Wine Intelligence, the two major online wine retailors are currently Yesmywine.com and

Tmall. They point to two reasons behind the growth of online sales; improving technology and the ability

for trusted online retailors to reduce concerns about fake wines.

We’d add a third; the closeness of the online world to consumers. The future wine market in China rests

with the younger popula;on, a popula;on whose day-‐to-‐day life is seamlessly integrated into the online

world. For these consumers, buying online not only allows for quick price comparison, access to

informa;on and user generated reviews but represents a natural and convenient solu;on that fits with

their busy lifestyles.


China Wine

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2013 will see con5nued diversifica5on in the tastes of consumers in core markets such as Beijing,

Shanghai and Guangzhou.

Last summer saw a surge in sales of white and sparkling wines fueled mainly by the increasingly

important female segment. 2013 will see this trend con;nue as well as increasing aDen;on paid to

bou;que wines from non-‐mainstream regions. The Chinese wine lover, especially those aged under 35,

love to experiment with wines and are increasingly looking to less mainstream op;ons.

5. A More Sophisticated Consumer


6. Tier 2 & 3 Cities China Wine

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Following the trend in Tier 1 ci5es, the wine market in China’s 5er 2 ci5es will begin to evolve.

Whilst the situa;on in regional ci;es is currently in a chao;c state, 2013 will see the first signs of an

increasingly professional industry emerge. Before that happens however, many sellers in these ci;es will

go bust before a more professional trade appears.

On the consumer front, more inhabitants in Tier 2 ci;es will start to move towards consuming wine

opposed to just gi_ing it. Wine Intelligence says there are currently around 20 million consumers of

imported wine in China – just 1.5% of the popula;on. They believe this will increase to around 80 million

by 2020, with consumers from Tier 2 ci;es making up the bulk.


Trends Continued

7. Trading Down

Streamlining of distribu;on models, increasing

wine knowledge, a changing demographic and

a more transparent pricing environment will

lead to an increasing willingness for

consumers to trade down.

8. Miniaturiza5on

As wine moves to become enjoyed on a more

regular basis, single serving boDles will

become increasingly popular. This will be

especially true in the city-‐based convenience

store format.

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9. A Focus on Fake 10. Chinese Wine to Go Global

While the focus of the Chinese wine industry

is firmly on imported wines into China, 2013

will see more Chinese wineries seek lis;ngs in

overseas markets, form strategic joint

ventures and purchase foreign wineries..

China Wine

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The Chinese government has iden;fied solving

the issue of fake wine as a priority for the

industry. 2013 will see increased pressure

from government, industry and consumers to

work together to improve this problem.

Furthermore, wineries that make an ac;ve

effort to employ ac;ve an;-‐counterfeit

measures will benefit from posi;ve consumer

sen;ment.

Trends Continued


Contact Us Contact us to discuss more about any of the points raised in this presenta;on or to inquire about how our flexible and cost effec;ve solu;ons to help wine business succeed in the Chinese market.

Contact Details

Winterless Center B-‐1201, 1 West Dawang Rd, Chaoyang District, Beijing,

China, 100026.

E: nick@chinawinesolu;ons.com M: +86 18210211487

W: www.chinawinesolu;ons.com

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10 trends for the chinese wine market in 2013

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