Wine export in China: Chinese consumers profiles
Treating the Chinese market as a monolithic and homogeneous block is not an effective strategy for building a successful brand in the country, especially within a sector that is itself differentiated, as the wine business. This is one of the first things you need to know if you decide to export your wine to China.
To clarify the main differentiating factors we need to be aware of, let’s take a cue from the contribution of Fongyee Walker MW to the 2021 edition of the wine2wine Business Forum. The Master of Wine spoke about the main characteristics that differentiate the groups of wine consumers in China, within the country but also looking to the West: let’s see them together.
Context or cultural contexts?
Anyone who has already had experience with foreign markets knows that it is essential to know the cultural context towards which one is aiming to export one’s business. This is especially true for a market like the Chinese one, full of peculiarities and different purchasing dynamics, which we talked about in this article on the 5 secrets to know to sell wine in China.
However, knowing the culture of the country may not be enough. In fact, with its 1.402 billion inhabitants, the Chinese population is full of differences related to geography, shopping habits, age, and social context. Analyzing different Chinese consumer segments is important to create a targeted targeting strategy. Let’s explore the three macro areas of differentiation that Fongyee Walker MW has identified to refine its strategy.
In China there have been many changes regarding how people drink and are interested in wine: if in Italy wine is mainly identified as a consumer product, in China it is rather appreciated as a luxury good, linked above all to important occasions of celebration, or to the contests in which it is donated to deepen one’s social status. For this reason, most consumers do not buy the product for themselves: even if there has been an increase in personal consumption in recent years, this type of purchase is not particularly characteristic. At this point we can identify two macro-categories of consumers:
- Regular consumers: their purchasing power is quite high, they consume wine almost with the same frequency as Western consumers precisely because, being people with a certain economic availability, they await many important occasions.
- Occasional consumers: it is a very large segment of the population which, although more difficult to conquer due to the reduced consumption of alcohol, represents a business opportunity that should not be underestimated. They are people interested in consuming wine as a value product, linked to a specific lifestyle.
The target age
Wine consumers also differ by age group: the generation gap in China is very narrow, turnover is fast and the differences between old and new generations are therefore more pronounced. Young people belonging to GenZ and Millennials know immediately what it means to consume: they receive different media influences from both older generations and Western peers and communicate in a different way both among themselves and with brands.
This is precisely the segment of the population on which Fongyee Walker MW advises to focus: young people in China have very high purchasing capacities, as shown by the fact that 79% of luxury purchases are made by the under 40, and they are more likely to buy luxury and lifestyle products, such as wine.
The geographical area
It is also necessary to pay attention to the location in which you want to position your product because each area is linked to differences in consumption of the inhabitants and to different disposable income. Cities in the third, fourth tier and throughout the rural area, for example, are increasingly digitally connected and eager to buy, and are therefore an opportunity for international business.
Localizing the product itself doesn’t make much sense, however, since wine in China has value as an international and not local product. It is more useful to think of locating the service: you need to create a presence in the reference area, getting in touch with the population through different strategies based on the city of your target.
Wineries wishing to carry their own brand or build a new one on a foreign market must first thoroughly study the characteristics of their target. In the case of the Chinese market, this means becoming aware that the target is not just one: as we have said, China is in fact a multi-faceted country.
Therefore, to reach Chinese consumers, a winery cannot underestimate the differentiation factors related to their age, their specific area of origin, specific purchasing habits. Once these elements have been clarified, the company will then have to develop an ad hoc strategy for each segment.
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