Wine opinion: Hong Kong buyers are more frugal than they realise
Like gilt jewellery boxes or cubic zirconia engagement rings, Hong Kong's wine drinkers are actually much cheaper than they look.
Contrary to the city's luxury-loving reputation, about half of its wine retail outlets derive most of their revenue and volume from the relatively modest HK$151 to HK$350 bracket. This is not including supermarkets, whose average bottle price is considerably less than that.
That is what we gleaned from research into our guide to the Hong Kong wine trade in conjunction with the Cathay Pacific Hong Kong International Wine and Spirit Competition.
However, when consumers were asked what they were willing to spend per bottle in a shop, they said HK$442 on average. That's above that bracket, and well into the realm of what we would call premium. This figure is not the product of big spenders and thriftier souls balancing each other out and leaving the middle empty; a substantial chunk of consumers buy wines within the retailers' sweet spot.
Looking at what consumers claim they spend over the course of a year, the study results more or less tally with the more moderate per-bottle price. Of the 42 per cent of consumers who claimed they spent HK$5,000 or less on wine, 54 per cent bought wine monthly or more, putting their average per purchase spend at HK$167. Nearly all of the same group claimed to drink wine a few times a month or more, which brings their average per occasion spend to HK$64 if we assume "a few" means one or two (and it never does).
These figures are much more in line with what both retailers and supermarkets seemed to think they were selling, than what consumers claimed was their per-bottle spend.
Possible explanations are that people actually spend much more per year than they think they do, or they don't actually spend quite so much per bottle (we do generally prefer to define ourselves by the top-end bottle we bought for a night out, rather than the cheap bottle of pinot grigio we picked up because it was on promotion).
We did ask consumers for separate per-bottle figures for restaurants and wine shops, to see whether people's wallets loosen when they are out for a night on the town.
Surprisingly, although consumers in restaurants are willing to pay more per bottle (HK$568), it is only about 29 per cent more, which doesn't correlate with the much higher mark-up on wine in restaurants.
Restaurant and hotel prices can be two to three times retail prices, which are already a 30 to 50 per cent mark-up on wholesale prices.
This means a bottle that wholesales for HK$350 might retail for HK$450 to HK$525 and be found on a restaurant wine list for HK$900 to HK$1,575 (which is a scary multiplication). Thus the tendency is to order a garnet in restaurants when you might spring for a ruby in the shops.
All of this can be hard to reconcile with all the big-ticket bottles you see around town unassumingly strewn on side tables of restaurants, both extravagant and humble. It comes down to four letters: BYOB. Interestingly, only 2 per cent of those surveys listed restaurants as their primary purchase location, while 44 per cent listed them as their primary consumption location.
These figures are skewed because they only identify people's primary choices for both activities. But they do give a good indication that although every table in the restaurant may have a bottle on it, the restaurant's wine income may be trifling. But if customers are enjoying good quality wine at decent rates, who cares if it's not a real diamond? Debra Meiburg is a Master of Wine