This year marks the 10th anniversary of ProWine Shanghai, the leading international wine fair that has become a barometer of China’s wine industry’s ebbs and flows. Making its comeback after the removal China’s travel restrictions, anticipations are soaring for the three-day scheduled for November 8-10 next week.
In this candid interview, Josh Gu, Project Director of ProWine Shanghai and Hong Kong, with a keen eye on the industry trajectory, dives into a retrospective of the wine sector’s metamorphosis over the last decade. He draws attention to the rise in wine diversity and the increasing professionalism of both consumers and insiders as the two “most significant” changes in the industry. More importantly, he highlights the three emerging trends that would define China’s wine market in the years to come.
As international brands eager to decipher the Chinese market – brimming with opportunities but fraught with challenges, Josh shares invaluable advice on building lasting relationships, and the exact moment that led him to believe ProWine has “taken root” in the market. Ready to uncork these insights? Read our interview with Gu in full below.
Q: ProWine Shanghai is celebrating 10th anniversary in China. How does it feel to reach this milestone, especially considering the challenges of the last few years?
In the past decade, I believe ProWine, be it as an exhibition or as a brand, has achieved something significant. Our greatest accomplishment has been becoming an integral part of the wine industry in mainland China, rather than just existing as a mere exhibition. Of course, in recent years, due to the pandemic, communication became quite challenging. Indeed, we faced several challenges. However, over the past three years, we’ve managed to build deeper relationships and stronger bonds with our exhibitors, customers, and partners. This, I feel, is incredibly precious.
On another note, many people often say that ProWine is very successful. What I always emphasize to them is that ProWine isn’t necessarily ‘successful.’ We are simply working and developing on the right path. This ‘right path’ revolves around B2B trade. Our slogan, our original intention, is to make ProWine Shanghai the leading professional B2B exhibition for the industry in mainland China. All our efforts are centered around this goal, and I believe it makes our work doubly effective.
Q: Over the past decade, what have been some of the most significant changes you’ve observed in the wine industry in China?
Over the past decade, the most significant and apparent change in the mainland market, I believe, can be described in two aspects: Firstly, the professionalism of both consumers and industry insiders has been continuously increasing. Secondly, there’s a growing diversity in the wine market. Previously, when people talked about wine, French wine was almost always the primary reference. However, now we have a broader array of choices. Wines from Serbia, Hungary, Georgia, North Macedonia, and other new countries and regions are being embraced by consumers in mainland China. I see this as the most significant shift. Additionally, the number of people, both young and old, who enjoy wine has been on the rise, which is another notable change.
Q: Can you share one or two of your most memorable moments from the past ten editions of ProWine Shanghai?
What left the most profound impression on me was the exhibition in 2017. When I looked at the attendance numbers towards the end, 49.96% of the attendees were from Shanghai, while slightly over 50% were from outside Shanghai. This statistic made me realize that ProWine had genuinely taken root in mainland China, in the strictest sense, and was actively recognized and accepted by many. Another data point to consider is from the ProWine exhibition in Germany, where over 50% of the attendees were coming outside of Germany. So, we had this concept that more than 50% of the attendees at the Shanghai ProWine exhibition should be non-locals. This was an exciting revelation for us at that time.
Looking at this year, from the recent data we obtained from our WeChat mini-program, out of approximately 3,500 entries, 56.5% were registrations from outside Shanghai. I find this number quite surprising and reassuring.
Q: What do you think has contributed to ProWine Shanghai’s enduring success and its position as the longest surviving international wine and spirits fair in China?
Indeed, when we manage the ProWine Shanghai exhibition, we always emphasize the idea of long-term vision. This long-term approach is something we discuss not only internally but also when communicating with various wineries, especially local Chinese wineries. The notion of long-term commitment and investment is a recurring topic. When we discuss many recent investments in wineries in China, the time frame from establishing the winery to selling wine and eventually making a profit might span 10, 20, or even 30 years. In a similar vein, organizing exhibitions also requires a long-term perspective. So, how can we maintain such success and continuous investment? I believe it boils down to two key points: breadth and depth.
In terms of breadth, we have organized promotional events in many cities, including several new ones, to expand our reach. As for depth, in the past, the ProWine Shanghai exhibition primarily focused on foreign wineries looking to tap into the Chinese market, with our primary target being importers. However, after a decade of growth, our ongoing efforts now involve assisting these importers in connecting with regional distributors and end buyers. That’s why we’re currently pushing into third- and fourth-tier cities and organizing events for end buyers. This includes hotels, restaurants, bars, and group buying clients. We’re actively building a complete industry chain, and it’s safe to say we’ve fully established it. Reflecting on this year, the pre-registered clients from the hotel and restaurant sector have increased in number and proportion compared to previous years.
Q: What can attendees expect from this year’s ProWine Shanghai in terms of new features or special events to mark the anniversary?
This year’s exhibition will be the first to take place after the end of the pandemic or the lifting of travel restrictions. I believe a key point for this year is “new”. First, foreign wine merchants and exhibitors will have the opportunity to meet and connect with new Chinese partners and clients. On the other hand, for our local buyers and attendees, they will gain access to new international information, the latest trends, new wine releases, and vintages from overseas. I think this is an incredibly important aspect of the event.
Q: Post-pandemic, how do you view the dynamics of the wine and spirits market in China? Are there any emerging trends or shifts in consumer preferences?
In the post-pandemic era, I firmly believe that the wine and spirits market in China remains a sector full of confidence and potential. We have no doubt about this. During this period, I personally think the involvement of younger consumers, especially those just beginning to drink wine, will play a significant role. Their awareness and demand for white wine, in particular, are expected to increase in the future.
During the pandemic, wine was traditionally seen as a drink for business banquets. However, as people stayed at home, many sought a more casual and relaxed environment to enjoy wine, and white wine was a particular stand-out.
Another emerging trend I foresee is the rise in demand for low-alcohol wines, semi-sweet or even non-alcoholic wines. This is likely to become a trend in the future. In response to this market demand, we will have a “sweet bar” set up at this year’s exhibition.
Q: In your opinion, what are the biggest challenges and opportunities for international wine and spirits brands in China in this post-pandemic era?
I believe that the opportunity lies in the rapid acceptance of Chinese consumers towards new and novel things, or new brands. As long as there’s continuous effort and investment in engaging with your consumers, I see this as the greatest opportunity. However, on the flip side, the challenge lies in maintaining this continuity and persistence. For instance, for this year’s exhibition, based on my current prediction, I expect more exhibitors and more attendees. I’ve already seen the increase in the number of exhibitors, and I believe the number of attendees will also rise.
But during this process, compared to previous times, what might lag or slow down is the purchasing cycle. Currently, wine merchants are further reducing their inventory. They need to clear out previous stock before procuring new wines. This was a point I discussed with some friends who are major importers. Nevertheless, the wine industry requires sustained effort. It’s essential to engage with consumers and our clients in various ways, scales, times, and places. I believe this is both the biggest opportunity and challenge.
Q: Any words of wisdom or advice you’d like to share with international wine and spirits brands looking to establish or expand their footprint in China?
If you ask me, I believe the key is to build lasting relationships with customers in the Chinese market. This is the advice I’d like to offer to overseas brands or wineries looking to enter the Chinese market. It’s crucial to continuously engage with your customers, understand their needs, and adapt to changes in the market. These insights should directly influence our products, ensuring they align with the demands of Chinese consumers. I see this as the biggest opportunity and wanted to share this perspective with everyone.