4 trends in China’s wine market

The wine category has had a few tough years in China, with many believing it has passed the peak period of rapid growth. Although Chinese consumers are back crowding hospitality venues and holiday spots, wine consumption remains below its pre-pandemic peak.

Despite the market challenges, there remains plenty of opportunity for wine brands who are in-tune with changing Chinese consumer preferences. Brands who continuously explore and cater to these trends will likely continue to grow sales in the market.

The main consumer force in the Chinese wine market has shifted to the younger generation. The consumption and social scenes of this generation are often notably different from those of the older generation. Their consumption demands are constantly shifting, which presents both challenges and opportunities for wine brands. Below are four trends that wine brands could consider to appeal to China’s younger generations:

1. Creating a fun sense of occasion

Chinese consumers love a reason over and above normal everyday life to consume something. Consuming wine is not no exception. An example of this is represented in the explosive growth of mulled wine over the winter festive season.

Consumers indulged in both homemade varieties, or at the many restaurants offering the spiced beverage, garnering high levels of discussion of social media. In addition to tasting great, there are three notable attributes of mulled wine that made it popular with young Chinese which could be considered by wine brands looking to create occasions for their own varieties:

• The category is strongly associated with a known holiday - Christmas - inherently carrying a sense of atmosphere and discussion.

• It is easy to DIY mulled wine, allowing novel-seeking younger consumers and restaurants to create different scenarios and put their own mark on it

• The products are visually appealing and easily spread on social media.

Homemade mulled wine shared on RED. Image: RED/Xiaohongshu

Restaurants launched mulled wine products during the Christmas season. Image: RED/Xiaohongshu

Building occasions that are fun, memorable and sharable that are well executed and align with the target audience’s needs will create strong brand associations for wine brands that are likely to expand beyond the occasion itself.

2. Healthy, girly and low-alcohol / alcohol-free "wine beverages"

Chinese consumers’ health-focus has been increasing for many years, and has accelerated with the pandemic. This is particularly relevant for the wine category. Since wine has been a consideration, many Chinese consumers have chosen wine over other beverages for health reasons - but they are becoming more refined in their evaluation of what makes wine healthy.

Concepts such as organic and healthy wines are receiving increased attention. Similarly, categories such white wine, low-alcohol, or alcohol-free wine are becoming increasingly popular among young consumers.

Health is also an important criteria with the rise of the she economy, with “low-alcohol wine” and “girly wine” being popular labels. Yet some popular choices such as “sweet wine” can be a little contradictory to the health concept.

People share their homemade wine beverage recipes and fruity low-alcohol grape wine products on RED. Image: RED/Xiaohongshu

3. Unique taste and unique products

In almost every consumer category in China, consumer love and increasingly expect new and novel products. Wine category is seeing its own version of this. In addition to traditional varieties like Cabernet Sauvignon and Merlot, an increasing number of consumers are starting to pay attention to wine products that feature more niche grape varieties and winemaking techniques. The different wines are appealing for their unique flavours and textures, which meet consumers' demands for individuality.

Posts on RED discussing about orange wine and natural wine. Image: RED/Xiaohongshu

4. Wine tourism to experience wine culture

With the passing of the pandemic, Chinese consumers’ enthusiasm for travel is at an all-time high. Although much of the tourism activity remains within China, there have been tourism booms in major wine-producing regions during holidays. This was particularly evident during summer, until the National Day holiday last year.

Chinese travellers are increasingly associating their trips with gastronomy, as we have from a grassroots level with Zibo’s barbecue and Tianshui’s hotpot to sophisticated wine tourism. With air connections and ticket prices improving, and overseas travel starting to grow again, well-marketed and China-ready wineries overseas are more likely to be part of the itinerary than ever. This will not only drive sales, but also word of mouth publicity and and opportunity to share Chinese-specific innovations.

Domestic winery tour, with the wineries in Ningxia (left) and Yunnan (right). Image: RED/Xiaohongshu.