Making Wine for the Chinese Market

Oct 15, 2010 No Comments by

Stephane Toutoundji is a well known enologist who makes wines for numerous vineyards in France (and even in Turkey !). But he is first and foremost the enologist of Château Latour-Laguens and Chateau Richelieu, both Bordeaux wines owned by Chinese investors. We wanted to know how it was to make wine for China. And we want to thank Stephane Toutoundji for this interview because it is still the season of grape harvest in France, a critical time when you are a winemaker!

ZW: Hello Stephane? Ari on the phone. I’m calling you from Shanghai.

ST: Good day. Or should I say good evening ?

ZW: Good evening. It’s 7:00 pm here. Stephane, I would like to ask you some questions about your job as an enologist and especially as an enologist for the two only Chinese owned vineyards in Bordeaux: Chateau Richelieu and Chateau Latour-Laguens. Can you tell me more about these two vineyards?

ST:

Château Latour-Laguens is a property of 60 ha with a vineyard of 30 ha in Appellation Bordeaux and Bordeaux Superieur.

It is managed by a young woman Haiyang Cheng, representing Longhai International Trading Co., an investment company with headquarters in Qingdao. It makes 150,000 bottles of wine a year.

Château Richelieu is a smaller property, that is now owned  by A&A International Group, a hong kong based holding company. It makes 70,000 bottles a year and earns a Fronsac Appellation.

Both managers of these vineyards are women. This is unusual in Bordeaux to have women leading Chateaux, even more when they are Chinese!

ZW: Are these wines produced in these vineyards only sold on the Chinese market?

ST: Yes actually. 100% of the wine produced in these two vineyards is only sold on the Chinese market.

ZW: So your job is to make sure these wines match what the Chinese consumer is expecting from a Bordeaux wine, isn’t it? How do you create wines that match the Chinese demand?

ST: I make balanced wines with silky smooth tannin. Tannin has to be not too tough for the Chinese taste! It is all about mix and proportions. Actually making a wine is really close to the Chinese philosophy. The wines I make have to be balanced. That is what I am looking for.

ZW: As a professional in the wine industry working in Bordeaux, how do you feel about the Chinese market and more generally about the Asian market?

ST: The Asian market is driving sales of Bordeaux wines because the rest of the world is still recovering. Actually, Bordeaux winemakers are happy to have the Asian market right now as the British and US markets are still very unsteady. Moreover, the potential is huge. The Bordeaux region expects a lot from the Chinese market in the future.

ZW: En primeurs sales are leading the news with prices of First Growth wines skyrocketing. Can you feel the Chinese demand in the 2009 En primeurs sales as well ?

ST: Totally. 2009 is an incredible year. We had everything in 2009. Sun when needed, rain when needed. These perfect climate conditions along with our work is going to give incredible wines in the Bordeaux region. It is maybe the year of the millennium. But even if it is an incredible year, we have to say that because, or maybe thanks to Chinese demand, prices are soaring.

ZW: You told me you were making wine for China. But which market are you targeting? Restaurants? Wine Bars? Individuals? Supermarkets?

ST: Restaurants and wealthy individuals. The wines produced in Chateau Latour-Laguens and Chateau Richelieu are both positioned to be mid-range to top of the range wines. It is distributed through their own distribution networks. These two groups own golf ranges, restaurants and wine bars in China. I make wines in accordance with the marketing strategy because I want wines I make to be drunk. Labels of these two Chateaux have gold colour because it is what attracts the Chinese consumer, especially if it is marketed as a high range wine and sold in exclusive places like golf ranges. My job is to make sure that the consumer is satisfied with what he drinks once he opens this beautiful bottle. I have to make sure that there is no gap between the marketing strategy and what is inside the bottle, the wine.

ZW: Are you expecting a boom of the Chinese demand for imported wines?

ST: Not really. I think we can’t talk about a boom of the Chinese demand. When I hear boom, I think of a boom of the demand thanks to the development of the middle class. The wines I make are primarily geared towards wealthy Chinese. And I expect this wealthy Chinese population to lead the demand in the future for mid range imported wines because they will become more and more aware that between poor quality wines and Lafite, there is a gap. But wine is and will be a luxury product in the future. So there will be a big increase in the demand for imported wines but led first and foremost by wealthy Chinese, not by the middle class, I think. But as the wealthy Chinese population is increasing fast, it leaves big opportunities for the business.

ZW: If I understand well, you are a winemaking consultant, meaning that you give your advice to numerous vineyards.

ST: Exactly.

ZW: All right, how did you become a winemaking consultant ?

ST: I worked in Bordeaux as an enologist in my early twenties and then went to Australia, working for Pernod Ricard. This gave me an exposure to another way of making wines along with marketing and sales. Afterwards, I became a winemaker for Bordeaux families owning vineyards in Australia and then I started to make wines as a consultant all around the world.

ZW: So you worked for Pernod Ricard ? Interesting. I met Yann SOENEN, Director of Pernod Ricard Asia for Mumm and Perrier Jouët Champagnes one month ago. And we had a discussion about the importance of the brand image in China. What is your point of view ?

ST: There might be no big brands of wine that is true. And this might be an issue in a market as new as China but I think this is not so important as long as your wine is distributed by the right persons. For example, Chateau Latour-Laguens and Chateau Richelieu are only distributed through their own restaurants, golf resorts and wine bars. A&A and Longhai have chosen to go up the wine industry value chain and this works. They don’t need a big brand because they can sell almost the entire production through their own distribution network directly to the final consumer.

ZW: I see. Thank you Stephane for this interview. How is the grape harvest by the way ?

ST: Great really! We expect a very good wine in 2010 as well after a great 2009 year! Thank you. If you have any questions, don’t hesitate to contact me!

ZW: I will! Bye!

Ari for Zhongguo Wine

See other interviews:

Interview with Gwenaële Chesnais, Senior Wine Education Manager, Pernod-Ricard China

Interview with Stephane Toutoundji, famous winemaking consultant

Interview with Yann Soenen, Regional Director for Champagnes Mumm and Perrier Jouët

Interview with Nicolas Touchard, Brand Ambassador for M. Chapoutier

Interview with Rai Cockfield, Managing Director of Altruistic Boutique Wines

Interview with PENG Jia, Director of the World Wine Education in Shanghai

News, Wine Marketing in China

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