Smaller Wineries need Branding if they Want to Find Distributors in China
While demand for foreign wine imports in China is booming, there is more to building a wine brand in China than just finding the right importer or distributor. As Western winemakers are finding out, there is a lot that goes into ensuring that your bottle of wine is the one that Chinese consumers select. On average a hypermart in Beijing or Shanghai customers can find 500 or more types of wines to choose from. So, the main question is: how do you stand out in this crowded market?
Understand Chinese Wine Consumers
The first step to building a wine brand in China is to understand the behaviors, preferences, and habits of Chinese consumers. The main factor that determines how attractive your wine is to Chinese consumers is its prestige and reputation.
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Chinese Wine Consumers highly value a prestigious brand, the overall factors :
- Including country or region of origin
- Grape variety
- Quality
The reason is that many Chinese consumers are “buying into a lifestyle” when they buy a wine bottle. For Chinese customers having the ability to afford an expensive and prestigious bottle of wine is a social indicator, it’s social proof that a consumer has achieved a certain level of success in life. Moreover, since bottles of wine are often exchanged as gifts or given to mark special occasions, the overall prestige of the brand matters more than in other cultures.
Chinese consumers are becoming more and more educated about the subject of wine, especially when it comes to food and their pairings, however, they still tend to buy based on an instantly recognizable brand that reduces the effort required to understand all the factors that help to determine the wine’s value.
French winemakers, for example, have embarked on extensive efforts to build a recognizable brand around the Champagne region of France. From this perspective, “Champagne” has become a brand and not just the name of a region, it is particularly appreciated by Chinese consumers, indeed they like to enjoy Champagne on the most important and festive occasions. Other wine famous wine regions such as Bordeaux have managed to establish themselves as brands in the mind of the average Chinese consumer.
A specific Target: Wine consumption varies greatly in the country
Not all wines come from famous and reputed wine regions, and that has forced winemakers to become much more creative about how to build recognition for their brands. The aim is to raise the brand’s online presence and interact with Chinese customers, if Chinese consumers often encounter certain wine brands at their favorite restaurants, bars, or hotels, they will be more likely to pick up a bottle of that wine the next time they go to a retail location.
However, there is another step that wine brands can take to have a greater impact on overall sales, which is targeting the internet wine sector. If you take a look at the overall structure of the Chinese wine market, you can see why this is such an important approach to take indeed only 18% of all wine sales take place in on-trade establishments. Moreover, supermarkets and convenience stores account for only another 30% of all wine sales. The other 52% of wine sales come from online sales and specialty wine stores.
It is important to go to where the consumers are online and spend time creating unique experiences that appeal to Chinese consumers. There is plenty of opportunities to brand a website on popular e-commerce platforms such as Tmall or Taobao or to create unique social media pages on Chinese social media sites, these websites are very useful as they help convert users into customers.
Market Research: a first step to entering the Chinese wine market
The Chinese wine market is extremely diverse, with almost 1 million different types of wines available for sale within the country.
Understanding the market and defining your goals is a must, you will need a reliable marketing strategy to make your spot in China. The competition is intense, and you will definitely need to make a serious effort to set yourself apart from your competitors, create and build your online presence and also get the attention of distributors, retailers, and consumers.
There are a number of reasons why wine producers should conduct market research before entering the Chinese market.
- First, it is important to understand the Chinese consumer’s attitudes and behaviors toward wine. What are their consumption habits? What do they look for in a good bottle of wine?
- Second, it is essential to have a clear understanding of the competitive landscape in China. Who are the major players? How do their wines compare to yours in terms of quality and price?
- Third, it is critical to developing an effective distribution strategy. How will you get your wine into the hands of Chinese consumers?
- Fourth, you need to create a strong brand identity that resonates with Chinese shoppers. What images and messages will resonate with them?
In China Branding is Vital for Small Wineries
There are many reasons why wine producers absolutely need the branding to succeed in the Chinese market. First and foremost, due to the sheer size of China and its population, it is a very competitive market. If producers want to stand out and be successful, they need to have a strong and recognizable brand.
Additionally, the Chinese consumer is becoming more and more discerning, and they are willing to pay premium prices for quality products that are well-branded. Therefore, producers who create a strong brand identity will be able to charge higher prices and command a larger share of the market.
It is very important to pay attention to branding. At the very minimum, you need to make sure that you have a distinct name and a recognizable logo or symbol that is protected and personalized. Otherwise, you run the risk of copycat winemakers using similar trademarks or logos. An unsophisticated consumer might reach for a bottle of “Pinfolds,” not realizing that it is a cheap copycat of a “Penfolds”.
Tips to market your Winery in China :
- Sponsor events and activities that are popular among Chinese wine drinkers. This could be anything from food and wine festivals to cultural and sporting events.
- Develop relationships with key opinion leaders (KOLs) in the Chinese wine industry who have a large following among consumers. Work with them to create content about your wines that is relevant and interesting to their audience.
- Invest in marketing initiatives that target younger drinkers who are just starting to explore different types of wines. Create content and campaigns that spark their interest and get them excited about trying new things.
- Make use of social media platforms such as WeChat, Weibo, and Tencent Video to reach out to wine drinkers in China.
What are the channels wine producers needs to invest in?
One would think that the answer depends on your goal: distribution or direct selling but truth be told, whatever way you wanna go, you’ll have to invest heavily in Chinese online channels. If you are looking at distribution, it’s going to be a tool to convince distributors to work with you instead of other wineries, if you want to sell directly to Chinese consumers, it’s going to be a way to convince them of your wines are superior.
Here are a few channels every winery serious about exporting their wines in china should put the effort in:
- WeChat Marketing: From WeChat group sharing to a WeChat (mini-program) store to an official account and on H5 Brochure that can easily be shared with distributors.
- Chinese Social Media: Promote your brand on Weibo with the contest, share videos about wines etiquettes on lifestyle apps, and so on
- Kols: Collaborate with Chinese wines’ big and smaller names. This will help your wineries make a name inside China’s wine connoisseurs market.
- Get yourself a website or webpage in China to gain more visibility on Chinese search engine (keep in mind that 80% of online research initiated in China are done through Baidu).
Selling your Wine Online in China
Chinese eCommerce platforms offer brands a large, engaged audience of online shoppers looking for wine.
Chinese e-commerce platforms are also known for their strict quality control measures, so buyers can trust that they are getting a good product.
Working on your reputation and online presence will make your Chinese eCommerce Journey significantly easier. From finding a Tmall partner to entering the platforms of your choice and to having a decent conversion rate from the get-go.
The main online wine shopping sites are as follows, it might be useful to sell your items on the following sites :
Consumers also buy wines on bigger platforms such as Tmall & JD. Truth be told, the platform you chose depends on your target audience as well as your budget.
The downside with eCommerce is that the main platform is still rather expensive for smaller wineries. However, there are alternatives (listed earlier in this part) that are more affordable.
Pinduoduo is a good eCommerce platform if you want to reach out to a price-savvy target audience and want to enjoy the benefit of C2M; (Consumers to manufacturer) which enable producers and manufacturers to sell at reduced prices directly to consumers with group buying. Pinduoduo is also a lot more affordable and is incredibly popular in China.
The main players also offer more and more options for smaller size company most notably through their online supermarkets both on local platforms and cross-border. However, not every brand will be able to make it, and wine with no online presence in china will struggle getting an entry ticket.
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