Asian business environment : a market survey of wine in China

Résumé du document

The idea of choosing this particular market for our study is of course mainly due to the long history and passion for Wine in France. As a matter of fact, we wanted to have a better understanding of the Wine Market in China so as to study the opportunity of creating a Business there. Through this essay, we are going to present a quick but comprehensive overview of the Wine Market in China. That means we will not only focus on the Wine produced in China, but also on the foreign competitors. The structure of this essay is quite simple. In the first part we will analyze the market, for example in terms of size using relevant figures in order to have a better understanding of the market, and see what trends come out of it. In a second part, we will look at the question "Who are the key actors and distributors?" Vs. the Rest of the World: In the Third part we will focus on the question "How to market and distribute wine? And fourth and last part we are going to do a SWOT analysis since it is a very useful marketing tool when it comes to summarizing a complex situation such as the Wine Industry in China. This market is facing numerous issues it also presents a lot of opportunities and should rise sharply in the next few years.

Extraits

[...] Thus import does not seem to have a noticeable impact on Chinese brands. Third part : how to market and distribute wine As China is now definitely a mass consumption society, the wine market has to face new issues: how can brands promote and defend their own identities so as to size all opportunities? China is more and more sensitive to advertisement The Chinese advertising market has considerably grown during the last 20 years, thanks to a growing younger generation attracted by more sophisticated brand products. [...]

[...] A booming market Having an estimation of the total wine size's market in China is quite problematical. Taxes on wine are indeed very strong which spurs some retailers to understate their sales and many other alcoholic beverages are put under the world as for example the rice alcohol. But, if we add total imports and domestic production, and subtract total exports the Chinese wine consumption is estimated to 861.53 m liters in 2008. The value of the total Chinese wine market grew by 136% between 2003 and 2008 to reach a total of RMB 54 millions. [...]

[...] Alcoholic drinks have reached a growing percentage of 17% year per year (Source: Nielsen Media Research). Chinese people are more attractive by foreign brands but shows interest for local brands too A good factor for the wine industry, is that foreign brands tend to become more and more popular among young urban consumers and young professionals. Their purchase power is stronger and this urban working population on coastal cities tend to become a rising important Middle Class in China. The discrepancy one can observe between urban and rural regions in other sectors is also true for the wine consumption. [...]

[...] The wine industry in China In 1998 Chinese wine companies went through a consolidation. That means that the number of firms has decreased by approximately 50 percent. This important change improved the wine's quality in China and allowed wineries to produce more. By the time of that structural change, Chinese people seemed to be more and more interested in wine consumption. This change implied a significant rise of sales. In 2005, wine industry net profit increased by almost 60 percent (twice as much as the increase of spirituous market and beer market). [...]

[...] However there is a differentiation to make between red and white wine. Red wine sales' are the best with a total value of RMB 20 million in 2009 (compare with 8 million in 2003). This increase is mainly due to the growth in the market for eating out, especially in western restaurants. White wines' increase (from RMB 1.5 to 5 million between 2003 and 2008) is due to the fact that the society evolved and turned to more western way of life: women drink more often and prefer white wine, sometimes mixed with other soft drinks. [...]