Thirst for Wine - Inside China's Wine Industry: The Success Factors of Marketing Wine in China

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Chapter 4, Market Entry Strategies:
This chapter focuses on possible marketing strategies for new entrants to China's wine market, foreign as well as domestic entrants but with a focus on foreign ones. It is structured as follows: First, there will be a short overview of the current market environment and second, the well-known marketing variables will be examined closely in order to give a framework for the marketing management.
4.1. The Driving Forces of the Market:
As in every emerging market, there are many opportunities for new entrants in the wine market. The following discusses the five driving forces that shape the Chinese wine market.
4.1.1. Competition:
'If every Chinese person was to drink half a bottle per year, the European wine industry would dry in the blink of an eye,' market analyst Jeannie Cho Lee observes , 'But that's unlikely to happen because, as demand increases, so does domestic production.'
New entrants to the Chinese wine market have to face fierce competition from domestic wineries. Not only has China become one of the leading wine producers in the world quantity-wise, but also the majority of Chinese consumers prefers domestic wines: According to a recent survey, in 2009 Chinese wine consumers drank 1,2 billion bottles of wine, of which only 8,5 % was imported bottled wine .
Although there are only a few top players in the domestic market, consumers have a wide variety of different wines and brands to choose from. Due to the considerably low level of wine knowledge, consumers tend to be overwhelmed about the wide range. Consumer orientation is key, hence domestic wineries have began to introduce brand management and POS marketing by launching bold brands, label designs and marketing campaigns to increase their brands' identification . For example, in retail stores domestic wine bottles are offered in wooden boxes including necessary equipment such as cork screws or fancy bottle caps.
But are domestic wines really a

Melanie Bobik, MBA, M.A., is an awarded PR- and Marketing expert with comprehensive work experience in the consumer sector. Born in Salzburg, Austria, the author studied International Management and Communications in Berlin, Hong Kong and Vienna. With her expertise as well as proven intercultural competence she successfully works for international clients in Europe and Asia, mainly Germany and China. Further, she guest-lectured at various universities, i.a. Berlin and Zhuhai.