Off-premise driving Australian wine sales in China

Wine purchases made online and via retail stores and supermarkets made up the majority of Australian wine consumption in China over the last three years, a study has found.

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A three-year study by the University of South Australia’s Ehrenberg-Bass Institute for Marketing Science funded by Wine Australia has found the number of people buying imported wine in China and frequency of consumption had sharply increased over the course of the project.

The Professor of wine marketing at Ehrenberg-Bass Larry Lockshin, also commented that there was a “surprising” off-premise trend which was fuelling the increase in sales.

“It was assumed that on-premise, especially western restaurants in China, would be the driving force behind wine consumption,” he said. “But what we’ve seen over the survey is that more wine is being consumed off-premise, which means people are buying it online, in wine shops and to some degree grocery stores than the last few years.

“People are moving from wine as purely a drink for formal occasions where eight or 10 people would share a bottle by having a “little teeny glass” each at a special occasion like a wedding or business function. Then the occasions started to become less formal.”

Lockshin also stated that the results presented “an excellent opportunity” for the Australian wine industry but producers need to approach the China market carefully.

“Build your brand, build it slowly, sustainably, know who you are selling to, pay attention to your labeling and pricing, spend some time to make it work,” he said.

The Wine Australia Export Report December 2015 revealed that the value of Australian wine exports jumped 14% to AUS$2.1 billion in 2015, reaching its highest growth in value since October 2007.

The strongest growth was in China, Australia’s third biggest export market behind the United States and United Kingdom, which grew 66% to AUS$370 million.