New Zealand wineries must band together to break into China market

WELLINGTON (Xinhua) – New Zealand's wine industry must mount a united effort if it is to crack the Chinese market, an Australian consultant has told wine exporters.

Frank Gibson, an adviser to businesses entering China, told an Auckland workshop that New Zealand wine had enormous prospects, but was handicapped by a fragmented industry with many small players, the BusinessDay website reported Monday.

"This is one of the areas where you really could get some big numbers and where there's huge opportunity in my view," he said, according to the report.

Gibson said Chinese consumers only really began drinking wine 10 years ago and the market needed to be educated.

"The domestic grape wine industry has grown steadily from about 200 million liters in 2000 to ... about a billion liters today," he reportedly said.

Chinese wine commanded 90 percent of the wine market, and the other 10 percent was imported bottled wine, which accounted for a fifth of the market's value.

However, when young Chinese splashed out on imported wine it was generally French or Australian, because Australia had mounted a big campaign there, he said.

Gbson said Chinese enjoyed New Zealand white wines in blind tastings, but marketing wine categories was just as important as marketing brands.

"Nobody has told them that people in New York and London and Tokyo and Paris drink great New Zealand wines ... No-one has told them the New Zealand wine story.

"The big problem the New Zealand wine industry has got is 90 percent of your wineries produce less than 200,000 liters.

"So who is going to go there and tell the story ... and should any one wine company have that responsibility, when telling the category story is just as important as the brand story.

"So there's a crying out need here for collaboration in the industry."

Gibson, a member of the New Zealand Trade and Enterprise (NZTE) Beachheads program, said NZTE had a big team working on a wine strategy and its biggest challenge might be working with such a fragmented industry.

His advice to would-be wine and food exporters was to band together with others of similar size.

"The more leverage you have going into China, the more effective you're likely to be and the more choices you're likely to have. Doing it on your own is very, very tough and anybody with less than a million cases I think is going to find it very, very hard."