Sparkling wine in China

Formulate market strategy in China

Context of the Market Research in China:

Our client produces prestigious sparkling wine worldwide. Due to the recent growth in Chinese wine consumption they sought to continue their international expansion by constructing their first vineyard in China. A lack of consumer knowledge regarding the quality of their merchandise, however, has thus far limited their sales. They required Daxue Consulting to help them formulate a more effective market strategy in China.

Steps of the Market Research – Sparkling wine in China:

Daxue initially conducted a comprehensive market analysis of the wine sector in China. Subsequently, it located opportunities within the market for our client. From this data, Daxue then assembled a go-to-market plan for our client. The phases outlined below indicate the topics Daxue researched and the methodologies used to obtain relevant data.

Phase 1, Overview of the Sparkling Market in China:

In conjunction with extensive desk research, Daxue organized store checks to attain an overview of the Chinese wine market. Both methodologies are suitable to gauge competition, the range of products on offer and their prices. They are complimentary as desk research allows one to collect and analyze a suitable scope of data, while store checks demonstrate how competitors physically present their produce to consumers. Both are important to understand the market.We carried out eighty store checks in convenience stores and supermarkets, both in Beijing and Shanghai.

Phase 2, Assessment of the Demand for sparkling wine in China:

To assess the demands of consumers Daxue presided over offline surveys and social listening. We used both methodologies in combination because it is vital to distinguish between the online consumers and offline consumers. Social listening provides access to online consumers, while offline surveys can communicate the demands of offline consumers. Offline surveys involved questionnaires being sent to 150 consumers from Shanghai, a tier one city, and Nanjing, a tier two city. The two locations were deliberately selected in order to obtain data from a wide demographic. Indeed, the individuals were chosen specifically too. We chose 75 young millennials and also 75 professionals. Meanwhile, social listening was used on many Chinese internet facilities, such as WeChat, Weibo and Baidu.

Phase 3, Segmentation of Demand and Market Opportunity in China:

To gauge the segmentation of demand, we organized in-depth interviews with two groups of individuals. The first group were our clients’ competitors and the second were imported sparkling wine professionals with ample experience of the Chinese market. These two groups were nominated on the basis that competitors would be accessing the same consumers and are, therefore, relevant. Imported sparkling wine professionals meanwhile would have expert sector knowledge and might underline other market trends our clients could exploit. Recordings of the interviews were kept and then transferred into written English.

Phase 4, Value Proposition in China:

Online surveys and focus groups helped indicate the potential value of the market opportunities researched by Daxue. Focus groups were arranged with groups of eight possible consumers. Online surveys were sent to many people in 17 cities. Three of these were tier one cities, whilst the remaining 14 were all tier two. Focus groups and online surveys are complimentary as they provide qualitative and quantitative data respectively.

Phase 5, Go-to-market plan:

With the data collected during the previous phases of research, Daxue was ready to provide a market strategy in China that included profiles of target customers, details of a brand strategy, their unique selling proposition and online and offline marketing approaches. It also incorporated financial forecasts that they were predicted to meet.