Wine column for week of 25 November 2013

Wine drinking in Europe declined in the past half decade. Between 2008 and 2012 consumption in four of the main wine producing nations – France, Spain, Italy and Germany – fell by an average of about 7 per cent.

The decline was most pronounced in Spain where consumption plummeted almost 20 per cent, partly because of that country’s ailing economy.

This was despite a global rise in wine drinking of about 2.8 per cent during the same half decade.

The International Wine and Spirit Research company (IWSR) predicts the wine industry will return to the growth levels observed between 2000 and 2005, but not until about 2016 when global consumption will reach 34.481 billion bottles.

Asia – particularly China – is being seen as the main growth driver. This explains why so many wine professionals are focusing on China.

China and Hong Kong imported Australian wine worth at least $US 66.32 million in the year to September. Australian wine guru James Halliday describes China as the “glittering prize” but cautions against the dangers of a “newborn” market.

So the launch of the 2014 edition of Debra Meiburg’s Guide to the Hong Kong Wine Trade at the Hong Kong International Wine and Spirits Fair this month (November) was an important event.

Even though the world’s wine community was keen to learn more about China, Hong Kong was “still the market everybody wants to know about,” she writes.

Debra Meiburg MW, a highly-respected wine judge, founded the first truly Asian wine competition, the Cathay Pacific Hong Kong International Wine & Spirit Competition. Last year the drinks business magazine named her the world’s seventh most powerful woman in wine.

Through her multimedia platform for wine “edutainment,” Meiburg Wine Media, she reaches more than 60 million Chinese viewers a month via online videos, taxi videos and a television show called “Taste the Wine” that focuses on wine travel.

The original edition of her guide appeared last year and concentrated on wine importers. For the new edition Meiburg and her team shifted their focus to wine retail.

Benjamin Chau, deputy executive director of the Hong Kong Trade Development Council, wrote a foreword to the new edition. “Hong Kong’s rise has continued to be stratospheric, with the wine import figure for 2012 topping US$1 billion, with re-export at around a quarter of a billion; a sign that Hong Kong is still the gateway to Asia,” he said.

Meiburg and her team surveyed more than 500 wine retailers in Hong Kong. The findings are both fascinating and useful. Specialist wine shops and private merchants make up almost 70 per cent of the places where respondents buy wine.

Noted Meiburg: “Those who drink most frequently are most likely to purchase wine from private merchants and least likely to purchase from the supermarket. Infrequent drinkers tend to favour supermarkets, wine shops and department stores. Only relatively frequent drinkers shop for wine online.“

About 30 per cent of Hong Kong’s wine sales occur at supermarkets. Most of the city’s more than 500 supermarkets have wine sections. The two main supermarket chains have designated wine buyers.

Meiburg writes that the big difference between Hong Kong and countries with a more competitive supermarket scene like the UK (where wine margins are razor thin) is that Hong Kong’s supermarket wine departments make money.

Wine “is apparently the most profitable product per square foot in Hong Kong supermarkets, suggesting that the supermarkets are not likely passing along all the benefits of superior buying power and access to lower-rent real estate to the consumer”.

Drinking wine has become much more of a regular activity, Meiburg said, with 64 per cent of people surveyed consuming wine a few times a week or more, while 17 per cent drink wine daily.

Two thirds of the people surveyed named “personal recommendations” as the main reason for buying, meaning personal as in face-to-face and “not a hot tip on Twitter” were more powerful than the media or marketing campaigns.

A companion volume, Meiburg’s Guide to the Shanghai Wine Trade, also appeared this month. Meiburg explained that trying to write a single book about China’s wine industry would be like “trying to write a book on ‘European’ wine”. She and her co-authors decided to find one market that everyone was interested in that “could also serve as a synecdoche of the market as a whole”.

Given the wine world’s interest in Asian markets, Meiburg has done the industry a huge favour in publishing these very relevant books.

Words: 745. Find a line here.

Categories: Not home, wine

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