Future Trend for China Fine Wine Market in the Coming 3 Years
photo credit：internet
Years before, fine wines are the forerunner in China wine market exploration. Fascinating brand stories and delicate taste made it the catalyst for upgrade of domestic wine consumption.
However, fine wine went down under the restriction of public funds and economic recession three years ago, fierce price war committing by E-commerce companies resulted in the squeeze of profit margin and reduce of wine merchants in traditional channels. Fine wine changed its role from hot pursuit to be left out in the cold, fine wine sales became dormant in China wine market for a long time, which also happened to OEM, VDF and VCE wines after a short period of boom.
Imports value in mainland China reached CNY 2.03 billion (€279 million) in 2015, whereas Hong kong reached CNY1.39 billion (€191.3 million ) in the same year, it’s easy for insiders to detect that most consumption in HK is done by mainland consumers. Domestic fine wine market value are estimated to be CNY 1 billion (€137.6 million) or more.
So who is going to pay for fine wine now?
If post-70s used to be a tower of fine wine purchasing strength, post-80s are the fresh purchasing power for sure. Compared these two age groups, post-70s believed in brands and paid for famous brand like DBR (Lafite) or Penfolds directly, while post-80s concerned more about drinking content inside, choosing wines with wonderful back stories or advocated by the well-known wine critic Robert Parker, such wines are also regarded as the long tail consumption products.
Then what should wine companies do?
I summarize different channels performance through my own perspective, KA market and traditional channels are the best ways in which fine wine like Penfolds series, DBR Lafite series and some Cru Bourgeois are on sold, and it is also the home for wines priced from CNY 50 to 90 (€ 6.88- 12.38).
On the other hand, fine wines selling in the group purchasing channel should mainly focus on their professional service capabilities and keep away from products similarity provided by KA market and E-commerce companies.
Take France for example, in the minds of Chinese consumers, French fine wines are dominated by Bordeaux and Bourgogne, therefore fine wine merchant especially for those group purchases should stick out outstanding diversity and advantage in depth, whilst on-trend products like Napa and Italian wine should be promoted in breadth.
Service capability is the key to build differences and unique characteristics.
First of all, service is especially important in selling wines which were not necessity, obeying no rating system while promising high profits.
so it‘’s a must for traditional wine merchant to sustain an everlasting service capability with professional supports and quality products.Consumers are getting mature day by day, never rely on selling wine by connections. A big step for fine wine merchants is to sell their wines to strangers.
The emerge and thriving of vertical wine E-commerce lies in three reasons, maturity of online purchase habit, rise of post-85s wine business insiders and a new upsurge in wine shop APPs.
photo credit：internet
Far-reaching influence will be seen in fine wine business brought by post-85s, who are equipped with professional skills, smart in learning new things and attached great importance to consumption experience.They are going to mark a new era of E-commerce with mass online buyers at hand, broadening personal relationship with social media.
In fact, post-85s are the participants of consumption upgrade, they are both sellers and buyers, making it possible to buy higher valued wine, enjoy better and choose wider. Distinguished quality, value return, splendid brand stories, long tail and abundant features are all jumped in one moment when you buy such bottles.