Burgundian wines flourished internationally in 2018, but why it has not influenced too much in China?Part1Burgundian wines flourished worldwide in 2018, but why it has not influenced too much in China?Liv-ex (London International Wine Exchange) recently published the 10 wines with the highest price increase in 2018, which are from the same production region-Burgundy.Liv-ex pointed out that due to the scarcity of high-end wines and the increasing demand, the prices of Armand Rousseau and Romani Conti DRC were pushed up, by an average of 42.% and 33.5%. Respectively, the prices of various vintages of these brands have doubled this year.In addition, Burgundy is also the highlight in this year’s Liv-ex 100, released cooperated with <The Drinks Business>. Burgundian brands on the list counted from 24 last year to 29. 14 from the top 20 are from Burgundy.The ranking of the wines traded in Liv-ex in the past year is reported based on four elements: price performance, transaction value, diversity of the products and vintages, and average price.
Part2Burgundy is far less popular in China than in the International marketLiv-ex data reflects the excellent performance of Burgundy on the international market. Xianghua Wu, a senior CEO of the fine wine supply chain company, understood Burgundy as a unique style and no substitutions. The limited capacity causes the demand excesses the supply. Increased demand this year is obvious. In particular, the price of Grand Crus has increased more than Bordeaux.Yet it is interesting that Burgundy is not as hot in China as it is in the international market. Yuangang Yan of Beijing Guangtianhe Culture Media observed they are mainly sold well in Europe, and perform indistinctively in China.Speaking of the reasons, Yuangang Yan believes the taste habits are different. “Compare to the natural and light Burgundian wines, Chinese prefer intensive styles. The intensity of Bordeaux wine is fair enough among Chinese. In the past two years, the South French wines that have sprung up in China are highly valued and also full bodied. Australian and Chilean wines are like-wise. It is not hard to find that the popular wine regions in Chinese market are strong flavored.” He said, “Even Chinese wine lovers can hardly appreciate Burgundy wines.”Part3Threshold in taste and priceShaoliang Sun, chairman of Zhuhai Quanda Industrial Co., Ltd., has been dealing with fine wine for many years, also pointed out that Chinese people, who are used to Baijiu and beer, are not easy to accept Pinot Noir, which is the main grape variety in Burgundy’s red wines. In contrast, Western consumers with high wine acceptance treated Burgundy differently.Meanwhile, Shaoliang Sun also believes that the high price of Burgundy wines restrained the development in China.“There is comparably great price difference in Burgundy. A good entry-level Grand Cru from a small appellation is about 200 Euros, which is too much to afford in China. Consumers would pay more on a good burgundy wine than Bordeaux first class wines.” Said him.Graduated from ESC Dijon Bourgogne, majored in wine business, Shuai Xu, the founder of Burgundy fine wine importer Puxiang, shared the same view that the price obstacle makes it hard to promote and sell Burgundy wines in China. At the same regional level, a bottle of Burgundy is far more expensive than Bordeaux.
Part4Low production capacity and insufficient official promotional activitiesIn addition, Yuangang Yan mentioned the low capacity of Burgundy production. Besides Romane Conti and Henry Jayer winery, what other famous wineries can you think of? Even few in the Chinese wine industry could answer this question, which undoubtedly further limits the promotion.Yi Fang, general manager of Changsha Portuguese wine industry, illustrated that low acceptance of Burgundy wines in China accounts to the small production.He continued: small production limits the budget a winery could use on marketing and branding like Bordeaux wineries. Wineries are too tiny for Chinese consumers to pursue a certain brand. Regardless in some cases even wine merchants don’t understand the winery, then how could them get the selling point? Originally promotion would take some time. Therefore, many Burgundy wines have not been stably promoted and sold in China for a long time.Shuai Xu explained Burgundy Wine Association has made less official promotion in major cities in China, which is not Association’s responsibility, instead, it is attributed to the low production of Burgundy. A winery has a few hectares of land. If you are not close enough with the winery, you don’t even get a share. Under such circumstances, there is no need for wine growers to promote at all.
Part5Niche wine everywhere, even a smaller market in ChinaNevertheless, Yi Fang said: every mature market can find Burgundy fans, but definitely a small group. It is unlikely to sell all over the world. It’s merely that the proportion of people who drink Burgundy in mature markets is higher than that of developing markets like China.Shuai Xu holds the same view. She said: Burgundy is highly respected in Beijing, Shanghai, Shenzhen and Guangzhou. However it seems not so optimistic in inland China. For example, cities like Chengdu still has a long way to have the budget of “wine as everyday beverage”. Part6Promotion should target to connoisseursSpeaking of how to promote Burgundy wines, Shuai Xu agrees that although people will take price factor into consideration, there will be no lack of customers pay the bill if the winery and the production region are famous enough. Therefore, the wine courses, theme dinners and advertisements of Burgundy wines are crucially important for insiders and consumers to understand the value of Burgundy from the theoretical knowledge and tasting experience. This procedure may take some time and professional guidance is required.This year, Fulong Wines has promoted a series of wines from a Burgundy winery. Yi Zhang, marketing director of the company told Jetek China Digital’s: “The promotion will only be effective if target groups are who understand wines and even are knowledgeable in Burgundy. Otherwise, even if rich people will not be acknowledged. Unless the brand is very famous, the taste cannot be well understood due to the intimate nature of the Burgundy wine.”“The promotion of Burgundy should also be professional. Burgundy is such fragile that the serving, catering, glasses, food pairing, and even room temperature are important. When we host a Burgundy tasting dinner, the wine glasses must be manually selected. Otherwise it is difficult to show the delicacy of Burgundy.” Yi Zhang supplemented.