The Italian wine maker Antinori, which plays a leading role in the home country for both red and white wine products, has signed an agreement with the Chinese giant Cofco, already partner of global wine exporters, concerning the development, the production and the packaging of Italian wine in the Chinese market.
ITALIAN WINES TO CONQUER THE “VALUE FOR MONEY” MARKET SHARE – Indeed, Cofco is the China’s second largest wine maker and it operates through its subsidiary China Foods which is also actively involved in importing wines, both bulk and bottled. For example last year, Cofco imported total 167,654 cases of bottled wine, mainly of French (43.1%) and Chilean (17.8%) origins. French wine is present along the entire spectrum of prices and dominates the “icon” wines with over 70% of the market share. Italian and Chilean wines are in direct competition at the core price segment with Australian wines, especially in the mid-range to high-end price range. US wine price points are on average lower. Generally speaking, Italian wine has a favourable reputation in China and is considered ‘approachable’ and ‘good value for money’. Although Chinese consumers are searching for perceived ‘premium’ products when selecting a wine, the ‘value for money’ proposition of Italian wine gives it a distinct advantage among the majority of Chinese consumers. ‘Wine has always been part of Italian diet, not a luxury out of reach’, said Antinori. Brought with them their 6 star products – Cervaro, Villa Antinori Rosso, Marchese Antinori Chianti Classico Riserva, Pian delle Vigne, Tignanello and Guado al Tasso, Antinori tried to pair these wines with Chinese dishes.
EXTENDING AND STRENGHTENING DISTRIBUTION CHANNELS – China is the world’s fastest growing market for alcoholic beverages in general and wine in particular. Over the past five years, China’s demand for alcoholic beverages has expanded of about 17 percent. However, in order to gain a foothold as an individual exporter in a vast market like China where reliance on a distributor is necessary, selecting the right partner is as critical as the localisation of product packaging and marketing. Country-of-origin branding is also an influential decision factor for wine consumers in China, and coordination between industry and government efforts plays a key role in this respect. The penetration of imported wines into China, about 80 percent of which is sold through on-trade channels, is largely concentrated in few cities, representing over half of the volume of imported bottles. With 60 percent of wine sales in China taking place during two Chinese festivals, it comes as no surprise that a localised strategy for marketing and packaging are key to driving sales. In line with the Chinese government’s policies to boost economic development in the interior regions, wine exporters are focused on finding the right strategic approach to reach China’s growing middle class. Therefore, selecting the right distributor who can develop and execute a local strategy is critical to capturing the growth.
