Welcome to this week's skinny on China. The Chinese have enjoyed a tipple for more than 5,000 years. Baijiu, the white spirit distilled from sorghum or rice, has been the mainstay of many festive evenings in China. Following the arrival of the Germans in the late 1800s, beer consumption has increased at such a rate, China is now the world's largest beer market. There was once a time, when China's borders were pretty well closed, when Tsingdao beers accounted for more than 90% of China's total exports; predominantly supplying Chinese restaurants housing thirsty Chinese expats around the world.
Fermented grapes aren't yet consumed with the same enthusiasm as baijiu or beer. Just 1 in 70 Chinese consumers are currently wine drinkers, but it's growing as Chinese tastes and lifestyles become increasingly western. This week the Skinny is swimming in news, views and advice about wine in China. For those with other interests, we've also got the skinny on wooing many of the other 69/70 Chinese consumers. Hopefully it won't make you too thirsty. Enjoy!
Luring China’s Little Emperors: McKinsey's 15 minute podcast on luring China's younger consumers: about 14% of the market but a big spending subset with 30% to 35% loyal to one brand (versus 20% in China) – good ones to lure.
CCTV's Ad Haul Tops Forecasts: CCTV's prepaid ad spend increases more than expected, up 11% from last year- an indicator of the confidence in China's domestic consumer market. Retail sales growth of 14.2% in Sep and 14.5% in Oct from a year earlier, undoubtedly contributed to the confidence.
What do Chinese Consumers Want? Not Barbie: The old Barbie-China-Failure story has reared its head again. How could they resist her beauty? Some good general pointers on Chinese consumers.
Rabobank: Are Brands too Late to go into China?: Is it too late to break into China if you're not already? Not according to Rabobank, especially in the food and beverage sector.
China's Wine Consumers – Research: Chinese wine drinkers estimated at 19 million. That's just 1 in every 70 people, so plenty of room for growth. The prestige seekers who just sip Bordeaux and Burgundy are picked to have peaked with more adventurous, who are more likely to drink other European and New World wines, on the rise.
Where Is China's Wine Market Going?: Insights into the Chinese wine industry from the expert CEO of ASC Fine Wines including the importance of good people, Government & knowing China.
Louis Vuitton Descendant Launches Wine for Chinese Consumer: Will Chinese consumers take to Louis Vuitton wine, like they did to their bags? It's aimed at the Chinese palate favoring "fruit-driven notes and softer tannins in red wines".
Nestle Moves to Congee from KitKat for Chinese Palates: "In China, you need Chinese people to develop products for the local market." – Nestle and Pepsi Co both set up research centers in China to develop products that truly resonate with Chinese palettes and use Chinese ingredients.
Starbucks in China Plays to Local Tastes: "Like Nestle and Pepsi Co, Starbucks has also opened a design, research and development centre in China, to help localise their products. Their focus is not just about appealing to Chinese customer tastes and lifestyles (sweeter drinks and more places to sit down), but also Chinese staff for retention by inviting parents to hear from managers who've worked up the career ladder. Starbucks sales grew 52% year on year in China.
5 Reasons Why You Should Sell Online in China and How Best to Do It: Excellent motivations for selling goods online in China and some good tips on how to do it. Our view.
China Car Market to Expand 8% on SUV, Small-City Demand: China is getting all big & American on us – SUVs are picked to be fastest growing car segment, picked to grow 8% a year until 2020. 'Smaller' cities expected to account for 60% of sales, up from 40% currently. That'll make biking fun.
Analysis: China Car Market may Require Two Fords: Ford is looking at a separate strategy for China, deviating from the current 'one-Ford' strategy – I'm amazed it's taken this long. Ford's cheapest car, the Feista, starts at $12,300 – whereas around 20% of new cars sold in China this year were less than $12,000
China's Toys for Grownups Market to be Worth 40bn RMB by 2014: Chinese art, much of what was lost during the cultural revolution, is not the only formerly-taboo category making a comeback in China.
That's the skinny for the week!
If you've missed earlier news or need to learn more, there's a library of information about Chinese consumers in prior China Skinny Weeklys right here. You can have this delivered to your inbox each week by subscribing for email updates, or if social media is more your thing, please follow us on Twitter, Facebook, Linked In or Google+, or subscribe to our RSS feed. If you have any feedback or suggestions for future articles, please let us know.