'You have to be there to build the brand'
Updated: 2014-05-02 07:50
By Li Xiang in Paris and Todd Balazovic in Beijing (China Daily Europe)
A worker at Chateau Leoville Poyferre, which has become the most popular brand of the Cuvelier family's wine business. Provided to China Daily
French wine-maker hopes for robust demand in China, but is not putting all its eggs in one basket
When Anne Cuvelier first went to China about 14 years ago to promote her family's wine business, at a tasting event in Beijing she found that foreign producers and chateau owners vastly outnumbered customers.
Today the situation is totally different, she says.
"People line up outside the venue and wait patiently to get in. The room is fully packed in less than 15 minutes," says Cuvelier, who looks after the marketing operations of her family's Chateau Leoville Poyferre, a second-growth chateau in the Medoc region near Bordeaux.
"This is something that could only happen in China," she says. "I am impressed by how quickly the Chinese have bolstered their knowledge and interest in French wines."
With China's growing wealthy and middle classes developing a strong enthusiasm for luxury goods and Western lifestyles, French wine exporters have enjoyed triple-digit growth in their exports to China over the past few years.
In 2012, exports of French wine reached 5.6 billion euros ($7.7 billion), the highest amount since the economic downturn in 2009, thanks to the growing demand for high-end wines in China, French Customs says.
China has become the largest Asian customer and the second-largest export destination for French wine. Consumption of red wine rose to more than 277.76 million 9-liter cases last year in the Asia-Pacific region, according to wine exhibitor Vinexpo.
While some producers' growth is slowing, the Chinese market still remains promising as Chinese wine drinkers are considered to be much more sophisticated and knowledgeable than they once were.
China is tipped to be one of the largest wine producers in the next five years, according to France's National Center for Scientific Research, and that is propelling more young professionals to formal training courses in Oenology, the study of wine and wine-making.
Wine education in China grew nearly 200 percent year-on-year growth last year, according to UK-based wine education organization, Wine and Spirits Education Trust.
Hiring Chinese-speaking assistants, opening Chinese social media websites, designing labels that appeal to Chinese consumers, and organizing tasting events in China are other common ways for French chateaus to attract Chinese buyers.
Cuvelier says that her chateau plans to organize wine-themed tours for potential Chinese buyers, which would enable them to visit the vineyards, see the winemaking process and taste the wine at the chateau.
The tour is targeting wealthy wine buyers as it could cost up to 400 euros a person, Cuvelier says.
"We want to reach out to people who are really interested in wines and those who can afford the trip," she says.
"We want to do something special for the Chinese market. From our specially designed wine labels to large tasting events, our purpose is to ring the bells in the minds of Chinese consumers," Cuvelier says.
The Cuvelier family has been in the wine business for 210 years and it started as a wine merchant in Lille in northern France. In 1903, the family bought the Chateau Le Crock, a mid-tier vineyard in Saint Estephe in the well-known Medoc.
The family expanded the business in 1920 by purchasing two additional vineyards, one of which, the Chateau Leoville Poyferre, has become the most popular brand of the family's wine business.
Cuvelier's cousin, Didier Cuvelier took over the business in 1979 and became the general manager of the chateau since then. Cuvelier says she is gathering ideas for a special promotion of the brand, which she hopes to be adapted to the Chinese market.
"We want to make sure they understand the wine and the work behind it. It would be a pity if a bottle is opened just because it is expensive," she says adding that marketing of the brand will start in big Chinese cities and then expand to smaller ones.
"You have to be there to build the brand. You have to show your face and your wines for a market that is very eager to learn and to taste different wines," she says.
Didier Cuvelier, the general manager of the French chateau, says it is a positive sign that more and more distributors and merchants from China are visiting the chateau every year.
With more than 3 million tourists in 2012, Bordeaux is one of the few cities in France that has had an increase in tourism, according to the Bordeaux Tourism Office.
Of those visitors, 35 percent were from outside of France.
"It is interesting to observe the Chinese market," he says noting that he has planned to buy up small neighboring vineyards to increase the production and to reinvest the profits.
In 2008, the global economic downturn hit Western demand for French wines, and many wine producers in Bordeaux saw a sharp drop in prices.
"During the financial crisis, the open-market prices were very low. We sold our vintage wine for 22 euros a bottle," Didier says. "But in 2009 the quality and demand was incredible and we saw the price rebound to over 60 euros a bottle," he says. "I am quite optimistic about the future and yet it is still difficult to predict."
While the sales of some wines to Western customers dwindled amid the economic downturn in Europe, Chinese buyers are being viewed as the saviors of the French wine industry. Sales of premium wines priced over 20 euros to Asian markets, particularly the Chinese market, have significantly boosted the overall export values, according to data provided by the French Customs.
But Cuvelier says that she is well aware of the risk of being overly reliant on the Chinese market, which has seen much slower growth partly because of the government's crackdown on corruption and extravagant gift-giving by officials.
French wines, which account for nearly half of all foreign wine imports to China, according to Vinexpo, have been hit particularly hard by the new measures.
"We don't want to put all our eggs in one basket," Anne Cuvelier says. "So we are also developing and nurturing the wine market in countries such as Russia and India."
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(China Daily European Weekly 05/02/2014 page21)