China’s premium Fine Wine & Liquor Magazine published an interesting article on how the Spanish wine industry is approaching the Chinese market. Much of that is also true for South Africa and I thought to have a look at how Spain is taking on these challenges.
The Spanish wineries that have had success in the Chinese market followed strategies of diversity, specialisation or niche markets. While these strategies would be more or less the same for anyone, the article mentions the importance of being innovative when entering China, with a focus on collaboration.
In my opinion, collaboration is of the utmost importance when dealing in China. The Chinese culture is so far from what we know in the West – especially the approach to food and wine. Trying to sell wine in China using the same principles that we do in the West, will never work. You need to understand the customs, the tastes, the etiquette.
We have been hard at work in China for more than five years, with Chinese colleagues working exclusively for us, and still we are not confident that we know enough of the culture of China to do the job well without collaborating with a Chinese partner. For us, the success lies in a close bond with someone who knows the market, who understands the language and culture and in someone with the same goals in mind – someone we can trust.
The article suggests that Spain gets involved in the planned City of Wine in Yantai, in the Shandogn region. Perhaps they should invest and open tapas restaurants, perhaps plant some vineyards of Spanish cultivars like Tempranillo and Grenache – try to bring some Spanish culture to China. Perhaps not a bad idea!
What we are doing is to run an incentive programme through which the best performers of our distribution company are brought to South Africa. Here we can introduce them to the culture of the Western Cape and South Africa in order for them to be better at selling the wine, but also from a tourist perspective to turn them into ambassadors selling the concept of South Africa.
Regardless of what you are planning, it is very important to invest in this market.
Finding a partner and investing in the Chinese market are two difficult and expensive exercises – something that you should only get involved in when you are really convinced of the importance of the market. For Spain, China seems to be quite important – although they are listed fourth in value for 2012, they were the second biggest wine exporter into China (after France).
When you are convinced that you should be in China, then you should commit now. It is still a difficult market and it is a foreign culture, but the Chinese are getting more and more familiar with wine. They have planted many vineyards, they are investing in wine estates in Europe (and now also South Africa!) and they are eager to learn.Do the hard work now, introduce them to your brand and wine – it will not get easier, competition from both other wine producers and Chinese wine producers themselves will only increase.
It will take time and patience and it requires working together. Introducing a foreign culture into China with its age-old traditions will never be easy and trying to do that as a single producer is unrealistic. Spain has to work together and so has South Africa – we need to market the country with its special attributes and wine as a whole.
The top five wine exporters to China are France, Spain, Chile and Australia. In another blog, I will have a look at why they are so successful.
