Ep. 911 Emerging Consumer Differentiation In China | wine2wine Business Forum 2021
Episode 911

Ep. 911 Emerging Consumer Differentiation In China | wine2wine Business Forum 2021

wine2wine Business Forum 2021

May 18, 2022
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Emerging Consumer Differentiation In China
Business
wine
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Episode Summary

Content Analysis Key Themes and Main Ideas 1. Differentiating Chinese Wine Consumers: Understanding the unique characteristics of wine consumers in China, contrasting them with Western counterparts, and categorizing them as ""engaged"" vs. ""occasional"" buyers. 2. The Chinese Digital Ecosystem: Highlighting the critical role of platforms like WeChat, QR codes, and live streaming in marketing and sales, and the irrelevance of traditional Western digital tools like email and computer-based websites. 3. Age Demographics and Consumer Behavior: Analyzing the distinct generational gaps in China (post-70s, 80s, 90s, 95s, 00s) and their differing consumer attitudes, purchasing power, and brand interactions. 4. Localization Strategies: Debating the effectiveness of localizing wine products versus localizing service in the Chinese market to appeal to consumers' desire for ""otherness"" and sophistication. 5. Drivers of Wine Purchase Decisions: Emphasizing that occasion, prestige, and ""face"" (reputation) are paramount decision-making factors for Chinese wine consumers, often outweighing taste preference. 6. Co-Branding and Offline-to-Online Integration: Showcasing successful co-branding examples (e.g., Yellow Tail Moscato and hot pot) as a method to engage a broader consumer base and link online promotion with offline experiences. 7. Brand Loyalty and Political Sensitivity: Discussing the nature of brand loyalty in China, which can be strong but is highly susceptible to political backlash or perceived anti-Chinese sentiment. 8. Retail Market Dynamics and City Tiers: Explaining the importance of understanding China's city tier system for targeted marketing and identifying emerging opportunities in Tier 1.5 cities. 9. The Role of Consumer Online Leaders (COLs): Introducing influential non-trade individuals who can significantly impact brand perception and sales through their trusted social networks. Summary In this episode, Fongyee Walker, a Master of Wine and co-founder of Dragon Phoenix Wine Consulting, provides a deep dive into the unique landscape of wine consumer differentiation in China. She begins by outlining the fundamental differences between Chinese and Western wine consumers, categorizing the former into ""engaged"" (urban, educated, affluent, often with international experience) and ""occasional"" buyers. Walker stresses the absolute dominance of the Chinese digital ecosystem, particularly WeChat, QR codes, and live streaming, asserting the irrelevance of email and non-mobile-optimized websites. She details China's distinct generational divides, noting how post-90s and post-95s consumers, despite their youth, possess significant luxury purchasing power due to cultural wealth transfer. Walker strongly advocates against localizing wine products (e.g., altering taste or labels) as Chinese consumers seek the ""otherness"" and sophistication of international wine. Instead, she promotes localizing service through effective digital engagement and strategic co-branding, citing Yellow Tail Moscato's successful campaign with hot pot as an example of linking online sales with offline experiences. She highlights that purchase decisions are driven primarily by occasion, prestige, and ""face"" rather than taste preference, and warns that brand loyalty, while strong, can quickly erode due to perceived political incorrectness. Finally, Walker discusses the varying retail market opportunities across China's city tiers and introduces the concept of Consumer Online Leaders (COLs) as powerful, non-trade influencers for effective brand building. Takeaways * Chinese wine consumer behavior is fundamentally different from Western consumer behavior, driven by unique cultural and digital factors. * Mastering WeChat, QR codes, and live streaming is essential for any wine brand looking to succeed in China, as traditional marketing methods are largely ineffective. * Younger Chinese generations (post-90s, post-95s) are a highly influential and affluent demographic for luxury wine brands. * Wineries should prioritize localizing their marketing and service strategies (e.g., through digital platforms and co-branding) rather than attempting to localize the wine product itself. * Occasion and the desire to gain ""face"" or prestige are often more critical drivers for wine purchases in China than personal taste preference. * Co-branding with popular local industries (like hot pot) can significantly boost sales and introduce wine to occasional consumers. * Brands must be acutely aware of political sensitivities in their messaging and materials, as missteps can lead to rapid and severe consumer backlash. * Tier 1.5 cities represent a significant growth opportunity for wine brands seeking to engage active consumers outside the crowded Tier 1 markets. * Cultivating relationships with Consumer Online Leaders (COLs) can be a highly effective, cost-efficient strategy for smaller wine brands to reach large, trusting audiences. Notable Quotes * ""Nobody communicates by email. Forget all email marketing, all email communication. There is no point to it in China."

About This Episode

The Italian wine podcast host introduces a hybrid edition of the wine to wine business forum where attendees will be in touch with wine experts and other wine industry experts. The speakers discuss the impact of COVID-19 on wine consumption in China, highlighting that millennials and Gen Z consumers are more likely to buy wine. They also discuss the challenges of engaging with younger consumers in China, particularly in branding and promoting the brand. The importance of researching tier cities and the use of QR codes is emphasized. The speakers emphasize the importance of building brand loyalty and creating a strong brand through live streaming. The importance of case preference and reputation in decision making for customers is also emphasized. The speakers emphasize the importance of brand trustworthiness and the use of live streaming platforms for sharing wine opinions. They also discuss the importance of consumer service and the importance of investing in online platforms for sharing wine opinions.

Transcript

Welcome to the Italian wine podcast. This episode has been brought to you by the wine to wine business forum twenty twenty two. This year, we'll mark the ninth edition of the forum to be held on November seventh and eighth of twenty twenty two in Verona Italy. This year will be an exclusively in person edition. The main theme of the event will be all around wine communication. Tickets are on sale now. So for more information, please visit us at wine to wine dot net. Italian wine podcast, a wine to wine business forum twenty twenty one media partner, is proud to present a series of sessions highlighting the key themes and ideas from the two day event held on October the eighteenth and nineteenth twenty twenty one. This hybrid edition of the business forum was jam packed with the most informed speakers discussing some of the hottest topics in the wine industry today. For more information, please visit wine to wine dot net and tune in every Thursday at two pm central European time for more episodes recorded during this latest edition of wine to wine business forum. Hello, everyone. Thanks for attending this section. About emerging customer differentiation in China. We phone you welcome. My name is Stabiler, an Italian wine ambassador, and also a wine educator in Hong Kong. And I will be the host for this action. Our speaker Fongi Walker has an extensive experience in wine, not only wine knowledge, but also the wine industry as a whole. Fongi Woka is a master of wine and a co founder with Eric Rick of Dragon Phoenix wine called Southin, Beijing's first and fully independent wine called Southin, and why service educational service since two thousand and seven. She became the first month of wine, resident in Mainland China in July sixteen. And she has also, she is also a wine judge, and she has been judging numerous wine competitions, including international wine challenge, Hong Kong International wine and spirit competition, Royal Melbourne wine show, Old Mutual trophy, South Africa wine show, Qantas, Western Australia wine show, and a lot more. Sony has also written articles for Decenta magazines, wine review, IVF, China, and wine in China. Her profile can be found in wine to wine websites. So let us work on Fongi Locur to the stage. Hello, everyone. It's lovely I guess it's lovely not to sort of see you. Everything's gone virtual. I'm very glad to have joined you today because, I have joined at sort of the last minute because I got caught by COVID regulations in China. So I'm speaking to you from a random office in Landzhou near the airport about to catch emergency flight. But I will try and make it as informative as possible for all of you. Okay. Thank you very much. So, we're getting into that topic. I usually hear about, like, why China wine consumer. And however, this term may be sometimes like, monoliving. So what is your insights? Well, what I want to do is have a little bit of fun and see ideas about how people consume wine here, and how they've been changing? I myself. I've been teaching wine in China since two thousand and seven. And I've seen massive changes and really, really quite big shifts in the way people deal with wine. What's been really interesting for me is to see how different segments of the population are consuming wine and what they are doing. Now I must add that I am not a professional wine survey consumer person. These are just my personal ideas, my personal insights. I travel around China an awful lot. I miss my home very much. And what I do is a lot is talk with people about how they can sume wine. So this, I was basically like, do millennials in China eat avocado toast? I mean, this is something that we sort of think of as a cliche and stuff, but it's important because we use these many of these words, z generation. And the problem is is what we think is that people around the world, if their own millennials are going to act similarly. So the question is do millennials in China eat avocado toast? And really, very few of them do. So this talk is about how Consumers in China may be the same. It's similar practice ones in West, and where they differ. Where they differ? So the one main thing about, I think, where they differ, and, sure you you've seen this state as well in Hong Kong is the the groups of consumers are pretty different from how they are in the west. Can we have the next slide, please? I'm sorry about my connection as, I am in a random office tower in Lanzhou. I'm not even sure where I am, but someone found me it. So this is, what I find in China is that there are two groups of people who really do buy wine. And the biggest group the group by far I engaged with are the engaged wine consumers. And these are really, you know, they consume wine almost on the rate of a Western consumer wine. In other words, they will consume, you know, a bottle every couple of weeks, I would say. And having those bottles is either through hospitality. But they don't often buy them through hospitality. They consume them in hospitality. Bring your own bottle of wine is a very, very, very strong culture in China. And, of course, they're purchasing most of this through a retail environment. So it's interesting that a lot of the wines here sold through retail are actually finally consumed in a house reality setting. They tend to be urban. They tend to be quite educated. A lot of them have studied abroad, and abroad, they have picked up habits. Maybe they've studied abroad or they've worked abroad. And they tend to be the richest people in China. Of course, China has so many very, very rich people, but they do tend to be, the people who have available income to spend on wine. And then there's the other group of people who buy wine who do buy it incredibly infrequently. This group of occasional wine consumers can can include people who only purchase one bottle a year. You know, one bottle a month would be considered a high purchasing rate for these people. And these people are very different. They are not necessarily affluent. They are not necessarily they, engaged the tool in wine education or anything. They were highly affected by COVID because most of the time they drink wine, it is in the company of large groups of people for celebrations the engaged wine consumers are wine consumers are beginning to just a little bit to drink at home. And, I mean, that's the one percent of the one percent. Occasional wine consumers though don't overlook them because if you can engage them in branding, whether that's a soft branding of region or style, or whether that's a hard branding of your own winery, You can actually engage them quite a lot, and you can achieve very good brand building with those occasional wine consumers. So don't necessarily look down on them, even though their their, consumption amount is not great. There's enough of them in China to make a really big difference, to a winery or to a region. So let's continue on to the next slide. And so this is just generally I just wanted to say just remember your target from your your matrix for target consumers in China is very similar to they are in the west. So we can think of them in terms of location in terms of their economic value. Of course, age, age is very interesting. This is where I'm gonna talk about how they differ between the west and the east, particularly in China, social, social media. Finally, education level. So firstly, I want to really talk about the age The next slide is, just the next slide is about the age gap. Now this a different age gap to those in the west. What it is is that in the west, we talk about we have the very clear gen x, you know, baby boomers, gen x, millennials, and gen z. I would say that the gap in China occurs a lot faster, particularly in the last thirty years. So what we have in China, instead of having generation x, we have the post seventies generation. Now you've gotta remember that this generation grew up going to primary school with the shadow of the Cultural Revolution with the fact that China was a very poor country, rationing of grain oil and other essential, you know, nutrients, was ongoing until they were of an age, you know, where they realized it until the eighties. So they grew up in a very, very, a totally different background. This is not like the baby boomers versus Gen X. The standard of living between baby boomers and Gen X is not great. The standard of living between a post seventy kid and a post eighty person is absolutely huge. The post eighties grow up with no memory. Of that really, really, really non affluent, non consumer culture. And what's happened is after the eighties, particularly for the past nineties, the consumer culture, rapid intake really affects the way that these people react to things. Essentially, anyone in China who's a post seventies generation, has had to learn in a quite old age how to be a consumer. And that really affects the way you consume and look at brands, whereas someone who's a post ninety five and a post lingling, zero zero post two thousands, they have grown up knowing what advertising is. And if you grow up being surrounded by advertising, the way that you react, the bad brand building is very different from someone who grew up with absolutely no advertising around them until they were fifteen, sixteen years old. So this is a really, really crucial thing to remember. That you've got a much faster turnover because the five year gaps in China have produced a very different growing up environment for people. And the other thing is is that It's a very different dynamic between older and younger generations. You know, the baby boomers made their name as a rebellion generation. But in China, there really has been no rebellion generation. People keep on thinking that the, perhaps the, o fives afterwards, the two thousand five afterwards might be that, but I really don't see that happening because for that generation, their their education, their goal has been so, controlled that it's actually very difficult to imagine them rebelling. So in China, there's never been that that generation gap where you turn around and you say to the older gap, you know, the older generation. Oh, you suck. Your value sucks. You haven't got that. Ethos of people doing that. And that's important to remember if you want to engage younger consumers that they you don't necessarily want to feed into this message of this ain't my grandma's riesling or something like that. Because it there is no connection with that. Anyways, let's continue with the young people. So let's, if we go on with the other host, particularly the young consumers, because the young consumers is where you really see this engaged group of wine consumers. Very much that the engaged wine consumers are generally late eighties. I would say, eighty five afterwards, ninety afterwards, and post ninety fives. Now in interesting in the west, A lot of winery people almost overlook these people because even though they drive trends like millennial avocoded hosts, they don't actually purchase, like, maybe premium wine. This is where it's very different in China. These kids well, if that shows my age, doesn't it calling them kids? I shouldn't call them kids. These younger vibrant people in the prime of their life are they have purchasing power beyond what millennials and gen zeds have in the west. In fact, almost eighty percent of luxury purchasing is done by this group. If you are ninety five or nine post ninety or post ninety five kid, You have been you know what it is to be a consumer. You want to consume, and that's why eighty percent of luxury purchasing is by this group. They are really the group to understand it. They are the group that traveled They're the group that are exploring. And why because they get money from the people who are sixties and seventies who save the money? Those people save the money so that their younger kids can spend the money. Why? Because in Asian culture, whatever money your parents have is your money. So it which is very nice. It flows down very much more directly. So if you are in a luxury wine group, this really for you is a key target market to engage with. So don't forget that. Don't think because they are young, that you can't engage with it. So let's look and see what kind of ecosystems e exist that you can engage with these younger people who have lots of money and are obviously spending it. So if we can go to the next slide, You have to understand if you want to build your brand, be it soft brand or hard brand in China, with why you have to understand that our internet ecosystem is very different from the West. First of all, you guys use email. That that's just weird. I'm sorry. I don't know a single Chinese person who communicates by email. I don't know. David Dean. I I I I Some sometimes. Sometimes. We they'd have to be really old and I think. Nobody. Nobody communicates by email. Forget all email marketing, all email communication. There is no point to it in China. The ecosystem is foam and it's WeChat. Your main way of dealing with engaging with consumers is the ecosystem, miss WeChat, and not websites. And, oh, god forbid, if your website looks bad on a mobile phone, Forget it. You're done. Nobody who is an engaged wine consumer will waste their time looking at an intran a website that is not engineered to be viewed on a mobile phone. Because people in China do not look at mobile phone do not look at websites on computers. Okay? The other thing you have to realize is people here communicate by QR codes. The more QR codes you can do, the happier people are. So if the QR code links to a mobile friendly site or a WeChat public account, that's how you're going to engage people, not by any other means, really. And you've gotta realize that this works into the purchasing ecosystem. We used to, you know, when we teach a class, students love the wines we show. They immediately say, Hey, where can we buy these? I really wanna buy some. We because I'm old, I used to put, like, website information on our wine info. Absolutely useless. In the last two years, We've switched there. We put up on our slide, a picture of the line, the information. All we do is pick up a QR code. And out comes the phone in middle of the class, they scan, I have had students order two cases of wine just from the QR code. In fact, sometimes I've attempted not even to put a picture of the wine. I will just put a giant QR code up there. That is really important that not only you as a winery producer, but also your importer know how to implement QR codes, know where to put them, know where to engage people to immediately scan them immediately engage and immediately buy your product. It's very, very important. And the other ecosystem you have to think about is online live streaming because that is an immensely important environment, and it is only growing and growing. Since WeChat added the live streaming ability on the channels, this has picked up particularly in the wine world even more. So if you want to engage with these people, take your mindset out of the western ecosystem and go into the Chinese one. And the other thing is that we let's go on the next slide is to think about the retail market and how to do it. Now retail markets for luxury products and food and beverage are doing super well in China. For the first year, actually, last year, they actually overtook a beauty, which is remarkable during COVID. The fact that food and beverage overtook beauty really shows that people are driving towards buying high worth, high value products, and they are premiumized. Now the only trouble with the premiumization of products particularly wine in China is premium wine in China is often associated with counterfeiting. So you've gotta be really careful about that. You've got to add really get to grips with transparency. Again, QR codes on your bottle. People really like that. But you've also be gotta be careful in these retail markets because they also differ in a quarter to where according to where you're aiming at. So let me give you an example, like Apple, you know, really directs its marketing to first tier and second tier cities. It's all over China. But if you see Apple's engagement, it's very much higher. Things like Tesla. You know, anything that's a more, high end thing, they will be very selective in where they're bringing their message to. And that brings me to the next slide, which I'm sure you guys all know but if we could have up next slide, this is just a little reminder. Sorry. Is my signal okay? Or can we get the next slide? Yes. Just in case, you guys are beginners or there's someone out there who's new to China, just to explain that we rank all the cities in China according to their tiers. So you have to decide where you want your wine to be most placed? Because for instance, entering a tier one city, Shanghai, Beijing, Guang, you're looking at very high levels of engaged wine consumers, but you're also looking at a fantastically crowded marketplace. So if you're going in there, you have to be very, very keen to engage directly. Actually, the tier one point five cities, this is a new thing, by the way. They've it used to be tier one and tier two. Now they've kind of begun to shift it a bit. The tier one point five cities for me are the cities that could be really worth going into quite hard as a hard brand or soft brand. Because these are the cities where people are really beginning to engage in really active consumers. They have a big population of those target, post nineties post ninety five, post eighty five wine consumers. And a lot of these people, they want the international lifestyle, but they do not want to necessarily live in a first year city. Are you enjoying this podcast? There's so much more high quality wine content available for mama jumbo shrimp. Check out our new wine study maps, our books on Italian wine, including Italian wine unplugged, the jumbo shrimp guide to Italian wine, Sanjay, Lambrusco, and other stories, and much much more. On our website, mama jumbo shrimp dot com. Now back to the show. It's very expensive to live in a first street city. The jobs are hard to get. It's almost impossible to buy a house. And in China, if you can't buy a house, you can't get on with life. You can't get married. You can't start a family. So I would always recommend to people researching the one point five tier cities. These are cities that generally have Starbucks. I always break cities into China into what they have. So Tier one will have all the luxury brands. Tier two will have a lot of the luxury brands. It might have a Tesla ounce outlet. It will have definitely, Starbucks. It might even have other international coffee shops. Tier two will also have Starbucks today. It will also be a lot more of the McDonald's or the KFCs. When you get down to tier three, you might find a McDonald's but it might be hard. You might find the Kentucky fried chicken, but it might be hard. And then tier four or five, I've just been spending the last week last few days in tier tier four and five cities. And believe me, You can't even get ice cubes. So so you gotta do that. Now, next slide, please, because I want to talk about how you localize here. There are two schools of localization in China. Do you localize the product? Or do you localize the service? Now examples of localizing products are things like KFC. Kentucky fried chicken in China is so much better than it is everywhere else in the world. Because they localize really well. They have possibly the best they do things like cumin, spicy fried chicken carcass, totally unsellable in America. It looks like it produces carbs, made fruit, Starbucks. I've put a little picture there. Starbucks has brought out an entire range of drinks because they've realized that most people in China don't actually like to drink coffee. But you have to be very careful when you start thinking about wine as a localized product, and I would not agree with doing that. I would say the trouble with wine is you can't localize it to China. Don't start putting Chinese stuff on the label or making it to Chinese tastes or any of that because Why do people consume wine here in China? It is the sense of otherness. It's the sense of sophistication. It's the sense of engaging a bit with international culture. And if you start to localize a product like that, you end up in huge problems. And I'm gonna give you an example of that cruise ship. You can see the picture of. That is the Norwegian cruise line, and they spent a lot of money launching a new cruise ship called Joy. And Joy was completely Chinaified. It was a cruise ship based to sell out of sell out of China, and they were offering Majong tables and Chinese restaurants and all the comforts of home in a tea ceremony place. It was an utter failure because what they failed to realize is that the demographic of engaged travelers who wanted the cruise ship experience, wanted it because they wanted English high tea. They wanted Italian restaurants. They wanted the sense that they were going away from China and being sophisticated So that's why I would say be very careful about localizing product. I would localize service, and that's my next slide. Localizing service in China means engaging with the environment, the ecosystem I told you about. It means you have to really understand how to build traffic on WeChat. WeChat groups are a key to building your presence. It's building your present through live streaming. You have to know who's active in the live streaming marketing. And those don't if you are looking to build a big brand, don't do it with wine KOLs. Wine KOLs in China only affect like Like, these little people, these little, tiny. You need to engage with lifestyle people, fashion people, luxury people, beauty products people, makeup people. And this is where you can really consider something that works in China offline. And this is a really vital thing to engage Chinese consumers, and particularly that post eighty five, nineteen, ninety five generation are really, really into it. So I'm gonna end this little talk with a case study, which I think might interest you as an example of how to build co brand. Oh, you're amazing. You changed the slide before. Like, we're psychic between here, China, and Italy. Way to go in China for large wine labels. Of course, with smaller wine labels, it's hard. It might be possible too for, consortium, you know, for trade bodies to do this. But co branding in China is great because it brings together those occasional line consumers who do purchase a lot because they're in large numbers, but they're a bit confused by the world of wine. So if you can bring in those occasional wine consumers, you've got a really nice big market for your wine. But the trouble is is that those people are never gonna watch a wine thing, or they're never gonna get engaged in a heavily wine based activity. So you need to co brand with something that creates excitement about your brand, leading them through from another industry. So for instance, let me give you an example. This is Yellow Telmoscato. So their demographic, their target demographic is definitely the ninety the post nineties, the post ninety fives, people who are urban, but not necessarily first tier cities. They're looking more for those tier one point five, the tier twos, the people who are kind of left out of the first tier cities, but these people really want to enjoy their life. They have close networks with friends. They're her friend's relationship, always more important to them than their family relationship. What do you do with friends? You have to go out. This is China. People live in very small apartments. You do not entertain at home. And what do you eat when you go out? The most popular thing to choose for this generation is hot pot, you know, fondue, where you dip things into a big pot and you talk with people and you Chinese, we say, you eat big and you drink big. And so what they did is yellowtail muscato entered, and miss and hot pot is spicy. So they chose this product, which is sweet, and they partnered it with a very big hot pot restaurant. And they did Muscato and Hotpot in the restaurant offline promotion, but they linked it with the online promotion of their Doyan, which is TikTok in China. So they have the hot pot restaurant has a very active TikTok account where people like, oh, yeah, I'm eating hot pot. And they did a campaign showing the Yana Telmoscata with the hot pot. And they also have an online store where people can order the hot pot so you can get it delivered to your office. So if everyone's working, like, hard overtime. Oh my god. We have to have dinner. Why don't we just order a portable hot pot with a little stove and you know, have a fun occasion and still get on with our overtime. So they did this where if you did that, you could get some wine. And so did you see how the online, the offline sort of comes together? And they managed to increase this Muscato series by seven thousand percent in sales over that period, which just shows you how successful a co branding thing can be. So There's a little example. Anyways, the next slide has my contact details or our website if you want to. And of course, I've got my QR codes, which are free to scan. Anyways, I do believe, I time to okay. It's, I spoke for half an hour. I hope it's useful. Very good insights in the Chinese wine market. So there are there are some questions in, in a q and a. So the first one being how is the brand switching or loyalty amongst the the younger segments? Brand loyalty can be strong, but unfortunately in China, brand loyalty or brand switching can react very quickly if the brand is perceived to do something that's anti Chinese. So this is something to be very careful of. You can build brand and they will have brand loyalty and the classic example of this is Dolce Gabbana. Because Dolce Gabbana had huge brand loyalty. I a few years ago, I brought some students to some, outlet stores in in the UK. And they made a beeline for Dolcey Gabbana. They were like, this brand is great. We love a love the design. We love the image. And then Dolcey Gabbana, unfortunately, ran some, online content, which was perceived, and I think rightly so, to be quite racist and a little bit sort of anti Chinese, and the reaction was huge. Okay. To the point where people were wanting to burn the brand. So I think brand loyalty can be quite good, but when you enter into anything political or any notion, and you can even get into problems with you know, calling Taiwan, Taiwan, and Hong Kong, all of those little things. You have to be very, very careful on your website, on your materials in order not to produce backlash. Because there's one thing that the younger generations do do. They have very strong, reaction times and very immediate reaction times. Okay. Thank you. And another another question is about, like, what are the main decision making factors for all nine white consumers in China and how important are your case preference? Oh, I I love people asking about case preferences in China. You know, I Okay. First of all, you have to when you ask that question, you have to be very clear, are you asking about engaged wine consumers, or are you asking about occasional wine drinkers? I would say Actually, for both of them, taste preference is one of the lowest decision makers. Case preference only matters when you are drinking wine. Most of the occasions for them buying wine is not necessarily for themselves. They're buying wine for the occasion. And so what is the real important driver for wine purchasing decisions is number one is occasion. Yep. Are you buying this wine on a when you're already drunk at karaoke with all your fellow office workers? Are you buying this wine because, you're you're getting it for your grandparents when you're returning home for new year. Are you buying this wine? Because there is an important business dinner, and you need to source the wine to purchase it to give enough toast during the business dinner. All of those, the decision making elements come from the occasion. And they are very much driven by reputation. They're driven by how much prestige will this kind gives you, in in in increasing, important. So, you know, drunken karaoke night not that important. Your your workers, you know, your fellow workers are not gonna be that much. But you might go for an, a well known area. You know, it says something if you go, oh, I'm gonna buy a Bordeaux. You know, because that's a little bit viewed as a little bit, you know, oh, I know a wine region. As you go further up the scale to buying the wine for maybe the company dinner or for a company occasion or for the boss, that it's it's getting so important. And for these, taste is irrelevant. Most of the time people buying these wines will not know what they taste like. So if you need to do taste preference, if you're gonna market for taste preference, you have to be really clear on who you're targeting in what occasion, and you also would really benefit from co branding because co branding allows to you to bring in consumers to taste your wine to then like it and then associate it with the other project. And that's why the hot pot one works so well. Right. Because hot pot is spicy for people. And when they market it with Muscato, Oh, my god. And in Chinese we say, it it it makes you able to get rid of the the spicy place. And in that case, the taste preference set work. It's segued seamus. It works seamlessly with the co branding opportunity that the wine offered. So you gotta be really careful to balance these. Okay. So what about, like, other, very expensive, internationally recognized, ground crews. How how how did people see us about, like, those expensive brands? Well, they're viewed in very high prestige. I mean, the joke that I owe has made is if you wanted to create the best wine that suited most people's taste preferences and had the prestige value, then Lafitte would make a muscato. So That, you know, a a a a a a discarded de la feat would be, you know, a fantastic product for China, but it doesn't exist. The only thing with the prestige brands is that they they They are great because they suit the main decision, the main purchase driving factor, which is it gives you face. It gives you reputation. It gives you a little bit of prestige. Taste preferences, they're really, very rarely come into it. And actually, it's very interesting because authenticity is important, but in a way, it also people Don't get that worked up about it. So for instance, I've been at occasions where I've known that the penfolds seven zero seven is is is not correct. And it's a very difficult thing to speak up on in China because honestly, Most people there, I don't think would notice. And if you mention it, then you're causing the person who brought it or provided it to lose face. So you're destroying the social harmony of the occasion. So, you know, it's it's very difficult. I was I've just been in Gansu. I I still am in Gansu. Hope I could leave. But I've been in Gansu, and I've been drinking some very expensive wine with the wineries here these are wine people, and they're just they're not tasting the wine. They're they're knocking it back. I mean, keep in mind these are fifth tier cities, fourth tier cities. So we're a long way off. Okay. So we've got another two question coming up. So how does the online platform affect consumer behavior? For example, the JD and other online buying platforms? I think that buying platforms, I don't I think that if you've got JD or or JD buying platform, of course, that increases the trustworthiness for a lot of people. So a lot of wine consumers, I know will choose deliberately to buy their wine off of JD rather than Timal, Tabal, because it's viewed to be more authentic. Especially when you buy it from the GAD recognized platforms. It's viewed as a more trustworthy platform. Having said that, you can get the same engagement rate and the same trustworthiness if you list your product on a a taobao store that store that is viewed as trustworthy as well. So I give you an example, a student of mine, miss UN runs a very successful, Taobao stall. Taobao store. I don't know type. I'm not sure about the English. Taobao store, which operates on, choosing sweet wines and, more fun wines for urban, female professional consumers. And she has built up her target demographic very well, and she's installed a trustworthiness and that people will go to her because of that trustworthy factor. So I think online platforming affects consumer behavior in that it drives people to certain platforms, to certain purchasing outlets by rating their trustworthiness. Now the other thing that you could say also affects it now is the live streaming. And most of the Chinese wineries, the very big brands like Jong You or like, Great Wall, They are very, very heavily dependent on the live streaming platform. And these live streams are not done by blind people. They are done by professional live streaming people, and they can move huge volumes. And that is being moved just solely because they have hired a very good, very engaging live streaming performer. And but that is it's huge investment money. You really do have to invest a lot of money on being on J JD and then being on their live streaming platform. So that's quite a big monetary commitment. So a smaller wine brand would be much better if they were looking at online sales to make sure that their importer works with trustworthy, high rated, you know, you want the the team all stores which have the the taobao stores which have like the crowns on them showing that they have been well rated by consumers. You want them to engage with that kind of platform. Because honestly, if you're a small brand and you have limited resources or your importer is a niche importer of high quality but low volume, you're not gonna be able to enter those huge JD online streaming. It it's just it's too big of monetary commitment. Okay. Thank you. And, two more questions. Oh, gosh. So what kind of consumer service would diff will be different, will be for different, demographic consumer that they are required in different cities? I mean, for me, that's almost beyond my remit because that's getting into things where different gear cities are something that I would really love to engage with more, but most of our clients, most of our students, nearly all of them are tier one and tier one point five. Yep. So these people are are are very clear for me. They tend to be more educated, more involved They don't tend to buy wine from live streaming. They will tend to buy wine more from trusted recommendation of word-of-mouth. Okay. And this is where I have this thing in China where for first and tier point one cities, especially for tier one point five cities, those middle cities. One of your biggest friends, there's consumer online leaders. And those are people who are not in the trade They are not engaged in wine trade. However, they tend to be wealthy individuals with large social networks who are viewed as by their group of social network people as people who know a bit more, people who are trustworthy. And actually, a a small brand, if you have one or two of these COLs who are your friends, you know, maybe after COVID, you invite them to your winery, and you've really built a a a great relationship to them. They could move most of your production. Just in one one point five tier city or two. Get one in Chongqing, one in Nanning, and you're set, man. Because the population of those two cities, you're already beyond the population, Italy. Okay. So, I think time is up, and thank you very much for me for very, insights in the topic. And I hope all the, all the listeners, all the audience can get something back home. There are so many great examples in a discussion. So, also my for myself, I learned a lot, and, especially, I I was studying in China, and I didn't know about, like, the, just q r code and, and all that type of thing. Yeah. So that was amazing for me. Thank you very much. I hope you enjoyed it. And it thank you for giving me the chance to speak English. I haven't spoken English for, like, three days. I'm so happy. Okay. Safe safe flight back to you. Back to you. Thank you. Okay. Bye everyone. Thank you very much. Thank you very much, everyone. Bye bye. Bye. We hope you enjoy today's episode brought to you by the wine to wine business forum twenty twenty two. This year, we'll mark the ninth edition of the forum to be held November seventh and eighth twenty twenty two in verona Italy. Remember, tickets are on sale now. So for more information, please visit us at wine to wine dot net. Hi, guys. I'm Joy Livingston, and I am the producer of the Italian wine podcast. Thank you for listening. We are the only wine podcast that has been doing a daily show since the pandemic began. This is a labor of love and we are committed to bringing you free content every day. Of course, this takes time and effort not to mention the cost of equipment, production, and editing. We would be grateful for your donations, suggestions, requests, and ideas. 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