Vinexpo 2012 Raises Its Glasses in Hong Kong

With wine exports to Asia slowing, the burning question running through Vinexpo Asia-Pacific 2012, held May 29 to 31 in Hong Kong, was how best to uncork the vast and expanding Chinese market. Hong Kong’s secretary for commerce and economic development, Gregory So, opened the wine trade show by quoting Vinexpo's chief executive, Robert Beynat—“Every producer is now thinking, China, China, China.” Greeting 1,050 exhibitors from 28 countries, So said, "bonjour," but it sounded more like “bon jeu,” or “good game,” something that comes naturally to a hall full of Bordeaux négociants, Sonoma exporters, Burgundian winemakers and Italian middle men.

The fair took place in the city’s soaring Convention & Exhibition Centre, which juts into Victoria Harbor, looking like the prow of a container ship loaded with pallets, trying to head up river toward China’s newly minted wealth.

Despite the international flavor of the wines on display, Vinexpo remains a French show, and the classified growths from Bordeaux were doing their best to remain the status symbol of choice among Chinese wine drinkers. Nevertheless, throughout the three-day fair and multiple Vinexpo Academy seminars and tastings on the side, an updated profile of China’s wine-drinking class emerged.

Although year-on-year wine exports to China are down 20 percent, consumption figures speak of a continuing boom. China now ranks fifth in wine consumption, ahead of the U.K., and a Vinexpo study forecasts a further 54 percent increase in consumption between 2011 and 2015. And the cliché of Château Lafite Rothschild being the wine of choice is growing dated—the study found that the average cost of a bottle is about $31, which does not buy a lot of first-growth. Most Chinese consumers stick to low-cost domestic wines.

Several seminars were devoted to profiling mainland wine drinkers. Market researchers reported that the reasons the average customer buys or drinks wine are primarily for health, as a gift, or to bask in its symbolic status. Only rarely do they buy wine to enjoy it in the company of a friend.

Nor does alcohol in China have many regulations. The Chinese can buy wine from vending machines, gas stations, online, at work, in restaurants, from their friends, in Walmart or Costco, or from a houseboat moored in Shanghai harbor. Only occasionally do they buy it from small wine shops.

"China is a red country" was the familiar joke among panelists over the three days. Bordeaux remains the party line for important clients or diplomatic dinners, though many wine professionals mentioned that Riesling often paired best with the sauces that dominate Chinese cooking. Only with meat dishes cooked with dark soy did Bordeaux show its lush colors.

Several exporters and négociants told Wine Spectator that they are targeting China’s growing middle classes, hoping to pull consumption to the next level. In the past, they have not been drinking wine, because they could not afford it.

Sales of mid-range Chilean and Australian wines are growing in China, better than wines from California, which a number of local buyers said were expensive and hard to understand, at least for entry-level drinkers. Spanish and Italian wines are also making some inroads.

Many of the Vinexpo seminars discussed the best labels to access the Chinese market. One marketing study shows that wine buyers in China prefer “prestige” or “stately” labels, although they love “eclectic” brands featuring flowers, gold, animals, dragons or even cartoon characters. Among the more popular stands at Vinexpo was that of Poupille, a Bordeaux from the Côtes de Castillon that is promoting itself in China through the characters of a Japanese graphic novel.

Despite the enthusiasm toward China, some experts insisted that the industry still needs to do its homework, cautioning that the nation's vast size and diversity will require specialization when it comes to maximizing the potential of China's many individual markets.