Mon 14 Feb 2011
Will $100 Wine Glasses Sell in China?
It was just a matter of time: With fine wine selling fast in Asia, glassware maker Riedel is planning to expand aggressively in China.
The Austrian company, which has eight franchised stores in the mainland, expects to nearly double that count to 15 by the end of 2011. After that, it plans to expand at a rate of 30 stores annually. If all goes according to plan, by 2015, more than 120 Riedel franchises will operate in China’s 25 largest cities.
“There’s no competition [in China],” says Riedel Glas Austria chief executive Georg Riedel, a 10th-generation member of the 250-year-old family-owned company. “It sounds strange, but the truth is, there’s still very little interest from competitors.”
With Asia’s wine consumption forecast to rise by 20% over the next three years, according to the International Wine and Spirit Research (IWSR) commissioned by Vinexpo, and China leading the growth, Mr. Riedel believes the market for wine accessories is ripe for the picking, and he plans to target professionals in management positions, between 35 to 50 years old.
“You have to be patient,” says Mr. Riedel, who notes that two-thirds of current Riedel sales in China comes from “on-premise” customers, the industry term for hotels and restaurants, and one-third comes from “off-premise” customers—those who purchase for home use. As part of its marketing strategy, the company will conduct a series of educational tastings to showcase how “a proper glass can function like a loudspeaker for flavors in wines,” and is worth the extra investment.
The majority of Riedel’s sales in China are for its red wine glasses, but the company hopes to increase education and teach customers “one size does not fit all types of wine.”
In the U.S., Riedel glasses start at $10 and go up to $100 for a handblown all-crystal glass. But Chinese buyers will have to shell out 15% to 20% more because of higher distribution costs in China.
“There is an added layer of middlemen in China,” explains Mr. Riedel. “We are not in direct contact with Chinese department stores…but will have to go through operators, which is an additional cost.”
By Amy Ma
- “Winning a silver medal in the HKIWSC has truly helped my product to achieve international credibility regarding its taste. This has positively affected
decisionmaking of several new merchants who now carry my product.”Kaustav BagchiOwner, Lamai Thai Spirits
- “Louis Royer Cognac has been entering the Hong Kong International Wine & Spirit Competition for many years. This competition is regarded as the most respected in Asian countries. Winning an award is a high honour for our brand and a further seal of quality for our multi-award winning Cognac.”Carol FrugierMarketing and Communications Manager, Louis Royer Cognac
- “Adding to our success over the past few years at the HKIWSC, winning a trophy means so much to us as we have just recently entered the Chinese market with our brandies. The Chinese market is unique, which makes it even more exciting to know that Oude Molen VOV Brandy is well accepted.”Kobus GelderblomBrandy Master, Oude Molen Distillery
- “It is a great honour for us to receive this award and we are very thankful about the reputation from wine enthusiasts in China. This award is a testament to the fact that our white wines not only match the traditional Austrian food but also matches perfectly with the Asian cuisine.”Katja PflogschWinemaker, Domäne Wachau
- “Having won three trophies in the last four years in different food & wine matching categories at HKIWSC has showcased Pegeric Pinot Noir and its suitability with Asian cuisines leading to its listing with one of Australia’s top restaurant – Melbourne’s iconic Flower Drum.”Chris CormackCEO, Pegeric Wines
- “To get recognition from such a prestigious panel is
veyrewarding indeed, and proves that our wines are made in a style that is truly food friendly. The HKIWSC has become one of the year’s most well-respected wine competitions globally. For us, the food match component is a fantastic chance to demonstrate how well our wines compliment so many different flavours. Moreover, it is a competition known and valued by our customers so a trophy can be hugely influential.””Susanna MayerWinemaker, Yealings
- “Awards and medals at the HKIWSC have been like a stamp of approval to the quality of our wines. Because it is an Asian-focused competition, I know that my wines are being judged and measured by the same yardstick as all the other wines, given our viticultural conditions are quite unique compared with the rest of the world. These medals give me and, more importantly, my consumers the confidence that my wines stand apart from the competition.”Kalash GurnaniWinemaker, York Winery
- “We are very proud of our results. One of our key focuses is the Asian market, so we really want to make our wines special and desirable for this market. That’s why we want to enter this competition and be evaluated by the expert judging panel.”Sofia Cajewski Winemaker, Cremaschi Furlotti
- “We at Yealands Estate Wines are proud to be
recognizedby the Hong Kong International Wine & Spirit Competition. The organizationis held in the highest regard and our success in the competitions has become a strong voice for our quality around the globe.”Avram DeitchGlobal Marketing Manager, Yealands Wine Group
- “Winning awards in reputable international wine shows such as the Cathay Pacific HKIWSC is one of the many ways of educating our consumers and giving them confidence in purchasing the Saint Clair brand. This enhances brand perception
increases sales across our entire portfolio of wines.”Maria EastonWinemaker, Saint Clair Family Estate anin turn