Mainland logs into world wine web
Yihaodian, the mainland e-commerce service controlled by the American retail giant Wal-Mart, plans to uncork the growing domestic demand for imported wine by bringing brands from the world's top wine producers to its online shopping platform.
The Shanghai-based Yihaodian, whose name means 'The No 1 Store', will introduce an initial batch of wine brands to mainland consumers in August.
The company appointed the business consultancy Data Driven Marketing Asia China last week to help it develop this nascent online retail market segment.
A DDMA China director, Sam Mulligan, said yesterday: 'This is a pioneering move by Yihaodian, which we aim to turn into China's most successful online vendor of wine and spirits.'
Mulligan said DDMA was in 'advanced negotiations with several leading producers' from the United States, France and New Zealand.
Yihaodian, which operates the fastest-growing business-to-consumer e-commerce website on the mainland, is expected to expand the market for fine wine through the more than 195 million Chinese shoppers online, not far short of the population of Brazil.
Yu Gang, co-founder and chairman of Yihaodian, said: 'For many international companies, online shopping in China is now large enough to justify considering an online sales strategy as a first step to entering the market.'
Total business-to-consumer e-commerce transactions on the mainland reached 240.1 billion yuan last year, up 130 per cent from 2010, according to the internet market research firm Analysys International.
Mulligan said: 'We are very confident that the package that we have developed for wine companies via Yihaodian will allow wine companies to develop a successful, profitable and sustainable business in China. We will make this service available to wine companies from all wine-producing regions.'
A survey by International Wine & Spirit Research found that China, including Hong Kong, surpassed Britain last year to become the world's fifth-largest market for wine.
'The official estimate is that the [mainland] wine market is worth 120 million cases, valued at US$16 billion per year,' Mulligan said. 'The ratio in terms of brand share is 85 per cent domestic, 15 per cent foreign. A large portion of the wine that is imported is blended with local wines to produce domestic brands.'
Mulligan said domestic companies mainly produced red wine, which meant there was an opening to sell a wider variety of wine. 'Our research indicates that there are strong opportunities for the right white wines, as well as for rose and champagne,' he said.
Yihaodian, launched in July 2008, runs logistics centres in Shanghai, Beijing, Guangzhou, Wuhan and Chengdu, along with delivery stations in 34 other cities.
Number of mainland online shoppers. Brazil, fifth-largest country in the world, has 205 million people (CIA World Factbook)