The China Wine Barometer (CWB): A look into the future

Abstract

The China Wine Barometer provides a time-series tracking of the attitudes, perceptions and behaviours of multiple samples of Chinese wine consumers, who are socio-demographically representative in terms of age, gender and income of the upper-middle class urban population aged 18-49, who drink imported wine at least twice a year. Data were collected twice a year over the three-year period 2013-2015. The time-series nature of the project, combined with state-of-the-art marketing research techniques equips Wine Australia and its levy payers with the knowledge to make smarter marketing choices, so that they can grow their brands, and assist them in decision-making and strategic development in the Chinese wine market.

Summary

The China Wine Barometer is a three-year experimental tracking program executed by the Ehrenberg-Bass Institute for Marketing Science on behalf of Wine Australia for the benefit of the grape growers and wine makers of Australia, who are currently exporting or thinking of exporting to China. Data were collected twice yearly from 2013 to 2015, which provides six deep dives into the state of the China wine market, with an emphasis on the Australian category in the context of its competition.

Each wave of data collection has been analysed individually and prepared into a managerially-useful slide deck that is available as a PDF download from the Wine Australia website. These reports identify the ‘state of play’ in the China wine market in a sequential basis over three years.

The decks include a dot point executive summary highlighting the key insights, tabulation and visualisations of the data with more detailed explanations and concluding recommendations on how Australian wine brands and the Australian wine industry can use these insights to perform better in the China market. The reports explore the attitudes, perceptions and behaviours of multiple samples of Chinese imported wine consumers. In addition, reports 1, 3 and 5 focus on country-of-origin perceptions and the on-premise channel. Reports 2, 4 and 6 focus on brick-and-mortar, direct-sales from distributors and e-commerce. Finally, reports 5 and 6 also summarise the evolution of the wine market in China by extrapolating out trends and illustrating patterns of behaviour among regular imported wine drinkers.

The major findings are provided in this final report along with the key recommendations. Overall, Australia remains the second largest wine importer into China behind France. However, France and French wine regions stand out as being much more well known and have far greater associations with premium and luxury than Australia. As more and more countries and regions export into China, consumers have much more choice and therefore, awareness of Australia, Australian wine regions and Australian grape varieties and wine styles has barely changed over the last three years. Australia and Australian wineries should continue to work hard to promote a unified image to wine drinkers and potential wine drinkers in China.

More and more people are drinking wine in China, so wine has moved from a luxury good to a premium drink purchased for social and health reasons. Consumption occasions are moving more into the informal and ‘at home’ locations, which means sales are growing faster in the off-premise than on-premise channels. Major supermarket and hypermarket chains remain one of the key purchase locations, but wine specialty stores and online channels are gaining sales, while local shops and convenience store channels are decreasing. The same informal trends are occurring on-premise, with growth in wine bars and less formal restaurants, except for formal celebrations, gift giving and business meals.

There are limitations of scope in this project. The project only investigated the current heavy buyers of imported wine in China as per the request of the industry. Data collection initially was executed across six cities in China, but in Wave 3, the data collection was extended to nine cities after consultation with Wine Australia. Future tracking in China should explore more lower tier cities and also establish benchmarks of light buyers and alcohol category consumers, who are not yet wine buyers in addition to our current understanding of heavy buyers. This will provide more meaningful intelligence to generate brand growth strategies for the Australian category.