Wine in China, the next big challenge ?

JD.com and Penfolds bet on future online wine demands

During the 4th of may JD.com announced their partnership which became stronger with the famous brand Australian brand of wine Penflods. They are puting their partnership to the next level in order to anticipate the demande coming for online sales about wine.

JD.com will be the fisrt retailer online that will purpose the Penflods products on the Chinese market. In the Penflods point of view, China will become  his second global location after Australia. In this two location Penflods will sale his new collection.

This reinforcement of the partnership between this two brands is not harmless. Indeed, the need for wine in China is not new and it is becoming imposing. In 2014, 11 million bottles of wine has been sold on JD .com, the year after the number of sales just doubled. Penfolds’ wine is a best seller in China. There are also wines from France, Chile, United States, Spain and Italy but the demand for Australian wine is significant.

Partnership, a good solution to fight against fakes offers

The demand of wine which is becoming high, attract also companies that offer fake wine. The name could be the same as a famous brand however the taste is significantly different. That king of offers can scared Chinese costumers who are looking for something special, good and dedicated for them. So it is becoming really difficult for consummers to trust certain wine which have a packaging made of really cheap material that affect directly the feeling the costumer have and the nature of the wine. For Chinses people, JD.com is a sure value which means they trust it and the products which are selling also. So if they buy wines on that platform it is for the quality, in consequence they come back for more. That is why JD.com build solid partnership in order satisfy the demand which will accentuate with time.

Any next step for JD.com on wine market ?

If the trends are confirmed and it surely will, JD.com has planned to expend this offer on the cross-border markets. This strategy comes perfectly during the time that China is working on his cross-border taxe, legislation and regulation. The Chinese Communist Party has introduced recently a new tax policy and in fact the CCP had increased the taxes. However it will not slow down the Chinese’s trend for wine.

Chinese people get more and more attracted by foreigns tastes and they are ready to pay the price to have premium goods and services also. The time when the Dragon was sleeping is over, now China want what Europe and United States had during many years : good products & great services. That is why brands like JD.com or Alibaba are working hard in order to provide this needs (from China and cross-borders countries) by attractiong luxury brands from foreign countries in order to make the difference and satisfy the demand who developped a qualified sens of tastes and an excellent palate. The point of this is to adapt the product and the service for converting prospect and retaining customers.

Further readings : 

1. New marketing trends in China
2. Why Fashion Western Brands have to use social media in China
3. Five e-commerce tips to expend your brand in China