The Continued Expansion of Italian Wines Throughout China and Hong Kong

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Over the course of the last couple of years, the Asian markets have opened up as some of the largest potential importers of Italian wine in the world. Though traditionally fairly reserved when it comes to wine, markets like China and Hong are fats beginning to purchase more and more of the drink from all over the world, especially as more people in those countries gain affluence and start to see wine as something of a status symbol. Of course, this has already started paving the way for more accessible wines as well, creating an early wine culture in the country that is rapidly evolving.

In all honesty, the Italian industry was a little behind the curve when it comes to China at the beginning of 2016. However, by the end of the year, it had started to develop its reputation and make some rather impressive gains.

Here we will look at how the industry started the year and some of the key events that led to it gaining some market share by the end of 2016.

The Early Months

Though the Italian industry had started to develop a foothold in China and Hong Kong prior to the start of 2016, it still lagged behind a number of other countries. In truth, it was a distant fifth place, behind the likes of Chile, France and the United States.

The strange thing here is that Italian cuisine is the most popular European food, especially in Hong Kong. It outstrips French and Spanish restaurants by an impressive amount, which surely offered a platform for Italian wines to be introduced and for more people to be made aware of various vintages through the restaurants.

Another surprising issue is that the collectible Italian wines, such as the Super Tuscans and the rarer Barolos, etc. also gained little traction in the market. In China, in particular, red wine has been seen as a symbol of good fortune, which has led to some of the most affluent customers buying bottles that would look at home in a collector’s cellar.

If anything, the pervading opinion appeared to be that Italian wines belonged in Italian restaurants and nowhere else. That was a viewpoint that the industry needed to change.

Italian Wine Day

The change began in April of 2016, which is when an official Italian Wine Day was announced in China. Held in September, the event was a joint effort from Vinitaly and the Alibaba group, which is one of the largest e-commerce platforms in the world and is particularly popular in China.

Even Prime Minister Matteo Renzi understood the potential impact this day would have on the industry, stating: “The future of Italy and of Alibaba are interconnected. As the world’s biggest e-commerce platform, Alibaba can radically transform our society. If we don’t maximize technology, we have no future.”

Again, it appears that the Internet was to play a crucial role in the continued expansion of the Italian wine industry. While products had obviously been available online before, the partnership with the Alibaba group was particularly important as now they were available on an e-commerce platform that the Chinese market both trusts and uses regularly.

Promotional Efforts Carry On

As the year progressed, it seemed this Italian Wine Day sparked the beginning of a race towards increased marketing in an effort to up the profile of the Italian wine industry in China. Still playing catch up, but slowly closing the gap, a number of other initiatives sprang forth, such as the Top Italian Wine & Spirit event that was held in the Chinese capital of Shanghai and achieved industry backing from the likes of Federvini, Enoteca Italiana, Rete Diplomatica, Unione Italiana Vini and a number of other important industry groups.

Increases in sales were also celebrated, with total Chinese imports from the Italian market rising by 36% in the first six months of 2016, while the sales of Italian still wines in the sector went up by 32% as well.

Slowly but surely, the Italian wine industry was beginning to gather a stronger foothold. However, impending news of China’s efforts to add traceability to the wines imported into the country, so that consumers can understand exactly where their wines come from, have the potential to slow things down a little. As yet, the methods the government will use to introduce this traceability are still unknown, but in the Italians case, it seems likely that the DOC will play a larger part in the future.

The End Of The Year

So where did the Italian wine industry sit in China by the end of 2016? Well, we’ll get the bad news out of the way first. Despite all of these substantial gains, the Italian market share still only stood at a total of 5.5%, leaving it still in fifth place.

However, looking at that stat alone ignores all of the good work that was done throughout 2016. Not only did Italy become the largest producer of wine in the world during 2016, but the figures quoted above actually show that Italian wine exports to China outperformed the overall market by over 6 points.

This is seen by the overall figures for the first eight months of the year, when China imported 1.4 billion Euros of wine into the country. This was an overall increase of 24% from the same period in 2015, but the important thing to note is that digging into that data from Nomisma’s Wine Monitor shows Italian imports grew by 30.4%.

The Final Word

So what does this actually mean? Well, it shows that the Italian import market is growing at a faster rate than the overall wine market, which means that slowly but surely the Italians are catching up to the countries that were a little ahead of them in terms of gaining access to the Chinese market.

Some important foundations were also set in 2016. The industry began changing the perceptions of Italian wine in the Chinese markets and its presence is more prominent than ever before. We see continued expansion on the horizon in 2017 and perhaps even a push towards 4th place.

 

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