In China, the world’s fastest-growing wine market, New Zealand varietals are expensive and need to prove they are worth the price.
Sales have been growing about $5 million a year since the free trade agreement was signed in 2008, reaching almost $30m last year.
Gains are expected to continue with the amount of wine Chinese drink predicted to grow by 15 per cent in the next five years while Western markets stay steady or make slight declines.
In China, French wine is considered the high class wine. Australian wines have a strong retail presence, and cheaper Chilean wines are frequently served at banquet dinners.
Banquets are anecdotally as much as 80 per cent of China’s wine consumption but new premier Li Keqiang is reported to be cracking down and insisting only domestic wine be supplied, so that market could shrink for foreign brands.
A lot of wine sold in China is for gifts, bought by corporations to give to clients, but Kiwi wine companies doubt if that creates repeat custom. Marriage agencies in China often have a couple’s picture printed on bottles of red wine with the wedding date as gifts for wedding guests but usually use locally produced plonk.
Shanghai native Haiying Shi said drinking wine was not a “hobby” of Chinese people as it was with Kiwis and Europeans.
So far, New Zealand wine seems positioned as an elite product in China. In Shanghai’s stylish French Quarter, New York Times-recommended Citizen Bar which describes itself as “a stylish restaurant, a civilised speakeasy, a sophisticated coffee house, and a sexy lounge” charges more than NZ$70 for a bottle of Matua Valley sauvignon blanc and upwards of NZ$90 for Kim Crawford pinot noir.
At uber-trendy Temple restaurant in Beijing, owned in part by Belgian chef Ignace Lecleir, where typical menu items are pigeon with smoked ventreche and shallot confit or roasted lobster with black yunnan truffle, Roaring Meg pinot noir from Central Otago will set you back NZ$130.
Kiwi wines make up only half a per cent of the world’s wine production but 2 per cent of wine on the market in China. Although the free trade agreement helps New Zealand wine enter the market, as an alcoholic product it is still subject to more than 34 per cent tax.
Some Beijing supermarkets specialising in imported food stock New Zealand wine. At the Blt Supermarket in an upscale mall where brands such as Gucci are tenants, Cooper’s Creek 2007 Hawkes Bay merlot is about NZ$65 and Oyster Bay sauvignon blanc sells for NZ$60.
At Beijing branches of French-owned supermarkets Carrefour, Kim Crawford sauvignon blanc, at NZ$42, is one of only a couple of kiwi brands on the shelves. Villa Maria’s 2010 sauvignon blanc sells for about NZ$40 at family-owned imported grocery chain Jenny Lou.
Locally produced Chinese wine retails for about NZ$5 a bottle.
New Zealand’s most successful wine brand in China is arguably Villa Maria, sold there since 2000 and known as “New” Marie Vineyard in Mandarin.
The 50-year-old brand is on wine lists at Chinese Starwood chain hotels such as the Westin and Sheraton, and sold by the glass at Pizza Marzano, China’s version of UK brand Pizza Express.
Villa Maria Asia market manager Charlotte Read educates Chinese about New Zealand wine by teaching them first about the country, giving video presentations.
Villa Maria pays a social media company run by a Chinese woman who once studied in New Zealand to promote it online on Weibo, the country’s version of Twitter to which, like Facebook, the ruling Communist Party has blocked internet access.
There are 390 million users on Weibo.
“We give her a messaging plan of the types of things we want to talk about. If you just talk about how wonderful wine is people tune out easily but she will talk about Rotorua geysers, Trelise Cooper’s latest fashion launch to keep the conversation about New Zealand going.”
Industry body NZ Winegrowers and New Zealand Trade & Enterprise have a Wine High Impact Programme focusing on Asian markets. To boost the reputation of Kiwi wines in China, it is sending popular bloggers who represent themselves online as everyman gourmands to travel to New Zealand next week.
“It’s influencing the influencers,” Read said. Two will be hosted at Villa Maria’s vineyard accommodation in Marlborough to spend a week blogging to their 100,000 followers apiece about the harvest.
“They write about wine like the average man on the street . . . it is a way for us to talk about wine in a way that resonates with people who don’t know much about wine.”
Chinese consumers are active internet shoppers, especially for groceries, which are cumbersome to carry home on a crowded subway. Online retailer TMall sells Cloudy Bay sauvignon blanc for NZ$47 and competitor YesMyWine had it on special for NZ$42 at the time of writing.
Alex Worker, whose father, Carl, is New Zealand’s ambassador in China, started Marianas Group last year with Ollie Farnsworth and Auckland-based Jack Vermunt to help Kiwi gourmet companies get in to the Chinese market. Winery Rabbit Ranch is one of its first clients. “There is a lot of wine being sold now online, you’re dealing with an increasingly sophisticated customer base, particularly medium to high earners researching and actively wanting to buy it online.”
Read agreed, saying the online wine retail market in China could get very competitive.
“There are a lot of applications now that allow people to price compare in China. They are very aware of what’s happening around the world and can see global prices online so you have to make sure your pricing strategy in China is consistent,” Read said.
Mahon China investment management director David Mahon is a Kiwi who has been working in China since the 1980s. He believed New Zealand wine should be sold in China but winemakers had to be disciplined to take a meaningful approach.
Asia NZ Foundation funded Jazial Crossley’s travel to China.