There is clearly a feeling in the Bordeaux wine industry of having been ‘saved by China’. This is the inescapable vibe I got during nearly two weeks in Bordeaux meeting dozens of winemakers and owners of Petits Chateaux. While the obsession of the rich Chinese with Chateau Lafite and other classed-growth wines is well known, less well known is the fact that even entry-level wines, Petits Châteaux and branded Bordeaux wines have benefited from China’s appetite for Bordeaux wines. This is one tide that has raised all boats in Bordeaux. Five years ago, China ranked as the 10th largest importer of Bordeaux’s wines. China now ranks as the number one market for Bordeaux wines. This is an incredible leap in the last five years. Here are the numbers for 2010 (courtesy Bordeaux & Bordeaux Supérieur Vintners Association). The numbers for China include Hong Kong & Macau:
- Last year China ranked as the number 1 market for Bordeaux wines by volume (41 million bottles exported). Of these, 39 million bottles were red wine and 2 million were white.
- China also ranked as number 1 market for Bordeaux by value (€441 million, or 29% of total exported).
While château owners across the board are happy about the booming demand from China, many also seemed slightly uneasy about the volume of their wine going to the Chinese market. There’s clearly the recognition that they should not be putting all their eggs in one basket.
Selling in Bordeaux:
Most châteaux in Bordeaux sell their wine through Négociants. With over 6000 châteaux in the AOC Bordeaux & Bordeaux Supérieur alone, this sales approach is necessary and sensible. Not every château has the skills or the resources to build direct sales channels across the world. But this approach it does have it limits. The Négociants themselves are over 400 in number. Whichever way you look at it, the market is quite fragmented. It is hard for the châteaux to develop an individual identity and at the same time, it is still hard for overseas importers and wine buyers to select from the thousand of wines on offer. Selling exclusively through Négociants exposes the châteaux in one significant way – they learn not to develop their own direct sales channels. In this sense, they suffer in comparison to producers in other countries who aggressively work to build their own sales around the world.
There are a few chateaux though that are aggressively developing their own direct sales channels, embracing the web, using social marketing and selling online. One good example is Chateau Bauduc. Their approach, apparently quite successful, is clear from their website.
On the other hand, if there’s one word to summarize the Bordeaux Négociants approach to business – it would be ‘traditional’. Few of them adopt technology aggressively or embrace web 2.0 effectively. The train is currently chugging along nicely, but what about the future? How will the relationship between the châteaux, the Négociants and the market play out? Will Bordeaux’s dominance continue, or will this region become a victim of its own traditions?