Great Wall Looks To On-Trade And Lower-Tier Cities For Growth
Date£º
2018-12-21 11:08 Source£º
www.thedrinksbusiness.com Author:
Natalie Wang Translator:
China¡¯s leading domestic winery, GreatWall, is switching its distribution strategy to the on-trade and lower-tier cities as a key driver for future growth, the company announced the move at its wine forum hosted in Shenzhen this month to commemorate the 40th anniversary of China¡¯s landmark ¡®reform and opening-up¡¯ policy.
Castle Li, general manager of COFCO Wine & Wine and GreatWall Winery, speaking at the wine forum in Shenzhen on 15 December.
¡°GreatWall started with restaurants and on-premise sales, and in the last two years, there¡¯s a clear recovery in the on-trade sector. If there¡¯s no GreatWall at a restaurant, we are losing massive opportunities,¡± said Castle Li, general manager of COFCO Wine & Wine ¨C the wine and spirits importing arm of the China¡¯s China¡¯s biggest foodstuff conglomerate COFCO ¨C and its flagship winery GreatWall, when speaking to a room of more than 1,000 distributors.
Founded in 1978, the same year when China¡¯s former leader Deng Xiaoping launched the Reform and Opening-up policy in China¡¯s southern Shenzhen, bordering Hong Kong, the state-owned winery¡¯s history is said to ¡°mirror¡± China¡¯s 40-year economic reform, according to Ge Zhirong, Counselor of State Council and former vice minister of the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), who was a headline speaker at the forum.
In 1979, the winery produced the country¡¯s first dry white wine, and then the first dry red wine in 1983. The winery is ranked as one of the world¡¯s top 10 brands in the world in 2017, and its market share in China along with Changyu accounts for at least 40%.
GreatWall¡¯s distributors at the Shenzhen event
In detailing the company¡¯s development strategy for 2019, Li pinpointed lower-tier cities across as China as the ¡°main battle ground¡± for the winery, as disposable income increases and the middle class expands in these cities.
¡°In terms of distribution, we need to battle it out in second -, third-, and forth-tier cities and return to on-premise and on-trade channels, which are key for GreatWall¡¯s future,¡± he said.
¡°GreatWall wines have to resolutely tap into second-, third-, and forth-tier cities. Whether it¡¯s expanding consumer base, or overall consumption potential or controlling costs, they are the most valuable main battle ground for wine,¡± he stressed.
In China, almost half of the country¡¯s 1.3 billion population still reside in the countryside.
Beyond on-trade sales, Li urged the winery¡¯s distributors to ramp up promotional and sales effort to penetrate wider market, in order to make GreatWall the go-to wine for family gatherings, friends reunions, business dinners and state dinners.
Millennials are another consumer base that Li noted as a key group for the winery, ¡°If we can¡¯t win over post 90s consumers (meaning consumers born in 1990s), we will lose our future,¡± he warned.
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