Hi, everyone. And welcome back to the show. Today we have in our studio two special guests, one of them you may still remember from our previous episodes on Prosecco.

So Matteo is from Italy. He's a wine expert and the senior manager in sales & marketing at the largest wine importer in China. He has extensive experience in the wine industry in promoting Italian wines, including prosecco in China as well.

Now another interesting fact is that he himself is from Veneto as some of you might know, that's one of the prosecco regions; and another guest, new guest, Daisy, she is an expert in brand promotion specializing in creating demands for foreign brands. Welcome to the show Matteo, Daisy.

Hi, Lulu. Hi Lulu.

I know I’ve introduced both of you, but could you also give our audience a little bit of introduction about what you're doing right now, your background? Daisy, would you like to start.

Sure. My name is Daisy. I am the founder of a company that creates demand for foreign brands in China. I was born in Hong Kong and educated in Spain, the UK, the Netherlands and China.

So I would say I have a pretty deep understanding of why and what consumer buy in the China market being Chinese myself. And we've worked across different industries mainly in F&B (food and beverage). We work with big consumer brands, global brands. We also work with independent producers and also restaurants and bars and whatnot. So I would say that our understanding of the wine and prosecco market, it's more psychology focused and also more broad.

That's exactly the sort of insights we're looking for. Okay. Thank you, Daisy. And Matteo, please.

Hi lulu. Hi Daisy. Hi everyone. My name is Matteo. I work in China right now, I’ve worked in this business for 22 years. I’ve done everything from farming, planting vines, selling wines, passing through production, distribution, importation; I work in F&B as well, of course marketing, sales, worked in Italy restaurant, I worked in different countries and cities like New York, Buenos Aires, Argentina, Dubai, Maldives, Shanghai now. So I think I know one or two things in wine industry.

I’m sure you're being modest by saying one or two things.

All right, let's dive right into your impressions of the current state of prosecco in the Chinese market. I'll direct this question to Matteo first because you obviously work directly in the wine industry.

Yes, current state of prosecco in Chinese market is it’s a product that satisfies a wide range of palates in the situation where people don’t want to spend money on expensive stuff, including F&B, that’s something I have to say.

Mhm.

They tend to see good price per value products. And prosecco actually falls into this category. So people still want to drink, they basically go for, let’s say more friendly choices definitely. We may also take into consideration that not many people in China drink prosecco, so the per capita consumption is really low, I saw some data saying that 30 million drink imported wines at least once a month in China, which is little.

The per capita consumption is 0.6,0.8.

Yeah.

It was actually down up to 1.3, that was like a year ago or two years ago when I checked there. It was a trend that is also going globally to be honest. Last data shows that 4% decrease in wine consumption last year, globally. It’s also shown in China.

Yeah. So they talk about this whole trading down in consumption. So you feel that in the wine industry, right?

The dropping consumption, generally speaking, it has to do with the spending habits on the trades, they don’t spend on the commodities right now, or less than before, and wines falls into this category.

That’s being like the feeling for the future more negatively that they were perceiving like a few years ago, especially Covid-19, after Covid these perceptions have become more and more real.

Yeah.

I can see also from our partners, F&B industry I’m talking about, they are suffering a lot, especially the fine dining, middle level places, restaurants and bars, definitely the entry level are really well because people downgraded their spending to seek more affordable way to eat and then you can see it scales out into other industries, not just on wine and food, butluxury items and cars, and everything else.

So it’s a pretty common trend obviously prosecco is in it.

The thing is good for prosecco is it’s still like good value for money product, I don’t think the entry level product will definitely be keeping stable if not actually decreasing.

We’re looking how the market is moving and how the economy is working, which is important for everything else. Because again, people keeps spending less, it’s really linked to how the overall economy goes.

Let’s see what will happen in the next.. second part of the year. Our hope is to see the stability to continue.

To stabilize.Yeah.

And hoping then no more shakes in the market happened, we’re still trying to be positive.

Yeah, exactly. I think it's a lot of it, it's also the perception of the future, the uncertainties of it.

Okay. So, what about you Daisy? What is your impression of the current state of prosecco in the Chinese market?

The current state compared to pre-covid? I see prosecco is a very popular ingredient in cocktails, especially the Spritz. And mainly, it's consumed entrée, meaning is consumed in hotels, restaurants or bar and cafés. It's very rarely that Chinese consumers would buy bottles of prosecco online, let's say to consume at home, it’s more of an occasion where you are sharing a meal or sharing a drink with friends.

So, in this regard, I think prosecco is still a very popular beverage by itself or as an ingredient for cocktails.

Yeah, I definitely agree with you on the cocktail bit, because every time I go to any Italian restaurants in China, and I will always start with Aperol spritz.

Yeah, and to understand the different decisions that consumers are making regarding what price here of beverage they're ordering. That's a concern. And also to consider that there are a lot of F&B venues that didn't survive the Covid wave. And I would say the overall industry is rebuilding itself from that big hit.

That is true. Because I mean food and beverage, especially if you're talking about maybe higher end restaurants they are not in the sort of like the essential category. So I think when it comes to consumer trading down, perhaps these industries are perhaps more affected compared to others, but that's just my personal opinion. But despite that I don't want us to start off and go down, this is really negative road.

Despite the apparent trading down in consumer products in general, even as a consumer or promoter of prosecco, I can see the growing popularity of prosecco in, let's say if we think about longer maybe 5 years or 7, 8 years, what do you think have contributed to the growing popularity of prosecco in China, in recent years, say five ten years? Let's have Matteo again.

Well. Definitely what contributed to the growing popularity in China is the affordable price, very friendly products, easy drinking, especially the extra dry version. Again, good for many occasions, like Daisy said in the previous questions, it's probably can be used for many different things, cocktails and Aperitif and as a drink before dinner as well in a restaurant.

So it's very, very let's say friendly to a lot of consumers and people that want to get into drinking wine. It's a probably the easiest option.

I see, and what about you, Daisy?

I would say there are 3 to 4 key attributes of prosecco that contributed to its growing popularity.

First of all, we mentioned that people are trading down, but I would change our perspective to value for money.

I love that word.

Prosecco, people now are just more careful with this branding which is very understandable and it's actually a good thing to do buying for value.

Yeah. So first of all, prosecco has very good reputation for being a very good quality but affordable price products compared to many other wines in the same category. Yeah.

Secondly the taste profile is quite palatable for the Chinese audience, it’s very friendly and easy to drink. The flavor is pleasant.

Yeah.

It's a very easy to drink product.

Very easy to drink. Yes, easy drinking.

Thirdly it would be the lifestyle cultural aspect. It's associated with a fun consumption occasion. It brings you happiness, it helps you relax, it's for celebration and the bubbly feeling, right? It's like a little festival in your mouth.

It is. Definitely and just sparkling wine in general is just very festive, very celebratory.