Speculation and analysis has surrounded the Chinese wine consumer, and as a booming but young market, contradictory opinions have flourished as experts, in a rush to seize market share.
Consumption has grown by 136% in the last six years, reaching 155 million 9-litre cases in 2013. While there was a 3.8% dip in year-on-year sales from 2013 to 2012 (roughly 1.7 billion litres), and domestic wines suffered a 4.9% fall in consumption in the same period, China still ranks as fifth largest consumer of wine in the world, fifth largest producer, and crucially, fourth when measured by value of wine being purchased.
The questions are who is drinking wine in China and how?
Average profile of wine consumer in China
The average wine consumer in China is between 25 and 45 years old, prefers red wine with a sweet (berries, fruits) and woodsy flavour (pine, oak). While the per capita consumption rate is 1.5 litres, most Chinese will drink it only a few times a year; urban residents tend to spend more on wine, either in quantity or quality. Women are starting to prefer lighter and sweeter white wines. Usually, wine is drunk on important occasions, such as holidays or Chinese New Year, when the red colour is particularly auspicious. Most food experts recommend white wine for Chinese cuisine, but reds still comprise between 70-90% of wine sales every year, and the consumer tends not to take this into account. A significant amount of wine, perhaps as much as half of all sales in China, were purchased online in the last six months; however, since Chinese consumers overwhelmingly prefer to buy vintages they’ve already tasted at a shop or a wine-tasting event, these were almost certainly previously known to the shoppers.
Broadly, Chinese wine-consumers can fall into three categories; the rich, younger socialites concerned with image, the businessmen and government functionaries, and the small but growing number of wine connoisseurs. These categories are by no means exhaustive, nor are they mutually-exclusive, but they represent the primary attributes appreciated by Chinese consumers: price, prestige, culture significance and quality.
The fashion socialites
The socialites typically buy wine as a means of displaying their sophistication and high status. Usually between the ages of 25 and 30, they’re likely to choose expensive wines for the prestige during their night-life, and don’t necessarily have a sophisticated palette. They prefer imported vintages, often American or French for the reputation associated with Western products. They sometimes mix wine with other spirits or mixers, and often drink in a competitive manner with their friends. Other alcohol appears to be overtaking wine in these circles; the last five years have seen nearly 55% growth in the sales of beer and spirits in Asia.
The businessman
The businessmen and government officials, usually between 35-55 years old, tend to drink wine at official dinners and banquets, where the positive connotations associated with red make it an ideal drink for toasts and celebrations. Having a contract to supply for banquets was beneficial for wine producers but Xi Jinping’s recent high-profile crackdown on gift-giving and lavish banquets has resulted in a slight decreased in these sales. Government officials and businessmen still remain valuable high-end customers. While they do not necessarily consume wine or have a developed appreciation for it, they are experienced drinkers and consider wine to be an appropriate gift.
The connoisseur
The connoisseur consumer group is a small but growing number of wine enthusiasts. They are typically wealthy, usually business elites in their 30 or 40s, often come from a very developed tea-tasting culture, who have taken up wine as a hobby. These individuals are able to have an in-depth discussion about vintage, grape types, different vineyards and so on. They are the focus of select, high-end vineyards, and while they represent a small portion of the overall market, they often spend a lot of money on their interest.
Overall, China’s wine consumer may not be as developed as they are in the West, but they have already shown huge progress since even 2007 when many consumers didn’t know what white wine was or that Australia produced it. It will continue to grow and mature, and the Chinese vineyards can be expected to play an even larger role in global wine culture and markets in coming years.
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