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Japan's Dedicated International Wine Show Proves a Sure Hit

Responding to the twin requirements of a bespoke domestic market and depressed European demand, Vinexpo Nippon proved a timely arrival in the Japanese wine sector, an area that is proving ever more adventurous and experimental.

Photo: A glass act: Tokyo welcomes Vinexpo Nippon.
A glass act: Tokyo welcomes Vinexpo Nippon.
Photo: A glass act: Tokyo welcomes Vinexpo Nippon.
A glass act: Tokyo welcomes Vinexpo Nippon.

Vinexpo returned to Tokyo late last year, the first time the international wine show has been held in the Japanese capital since 2002. First staged in 1981 in Bordeaux, the capital of the French wine business, the event initially ventured east in 1998, with organisers then seeing a clear need for an Asian edition. The resulting event – Vinexpo Asia-Pacific – was staged twice in Tokyo, before moving to its permanent mooring in Hong Kong. Now, though, Vinexpo has launched Vinexpo Nippon, an event solely dedicated to the Japanese market.

The move reflects the fact that the Japanese wine market is quite distinct from the mainstream Asian wine market, with the many Japanese wine professionals apparently feeling short-changed by the Hong Kong event. According to Yasuhisa Hirose, the President of Enoteca, one of the largest wine importers and distributors in country, the Japanese have long hankered after their own expo.

Explaining this separatist sentiment, he said: "I was always urging the organisers to put on a Hong Kong-style expo in Japan. The show is a little different from the ones in Hong Kong and Bordeaux. At this event, the importers have booths, for instance, while they don't in Hong Kong or Bordeaux."

Another factor driving the launch was the arrival of Festivin, a rival wine expo that was launched in Tokyo four years ago. Staged annually at the end of November, it has grown from an informal gathering of wine enthusiasts into a major event. The 2013 edition of Festivin, for instance, attracted 2,200 paying visitors, with the event expected to grow still further.

The continuing poor performance of the French economy may well be another factor in the launch of Vinexpo Nippon. While the domestic market remains sluggish, it is, after all, only prudent to turn to the export sector. Tellingly, a substantial number of the 500 wine and spirits brands represented at the show were French, with several of the exhibitors confirming that the state of their domestic market was spurring their export drives.

A prime example here was Miranille, an exhibitor based in the north-eastern Lorraine region of France. Traditionally, the company has produced a liqueur from Mirabelle plums flavoured with Madagascan vanilla pods. Up until this year the its sales efforts have all been concentrated on its domestic market. According to Franck Fuseau, the company's Export Sales Manager, that has now all changed.

Photo: Newly popular: Chilean imports.
Newly popular: Chilean imports.
Photo: Newly popular: Chilean imports.
Newly popular: Chilean imports.
Photo: Georgian wine: Big in Japan.
Georgian wine: Big in Japan.
Photo: Georgian wine: Big in Japan.
Georgian wine: Big in Japan.

He said: "We only started exporting in May, when we went to Shanghai. We did this is as we had invested a lot of money in equipment and needed to recoup that cost through increased sales."

In Tokyo, Miranille was promoting Miranito, a sparkling, ready-made, party-themed cocktail version of its standard Mirabelle liqueur. Introducing its new offering, Fuseau said: "While it is based on Mirabelle, it is lighter – coming in at 12% alcohol. Our main idea is everything starts from Mirabelle. We want to extend its use.

"Miranito was developed with the help of Etienne Descoings, a famous bartender who works at the Cannes Film Festival. Thanks to our new equipment, we are able to produce one million bottles per year. Of course, we are not selling anything like one million, hence our need to export."

Luckily for the company, its booth proved quite busy, with Fuseau reporting considerable interest in the product. He said: "We've made a substantial number of contacts, maybe 50 or 60. Several alcohol retailers are very interested and, once we get an importer in place, they have indicated a willingness to stock it."

This interest in Miranille's unique liqueur and its spin-off products perhaps reflects one of the main trends in the Japanese wine and spirits market, one clearly identified by Hirose. He said: "I think the market will become more diversified. The economy is getting better and, as a consequence, people are drinking a wider range of products."

Hirose had distinct views as to just how the Asian wine market has developed since Vinexpo was last held in Tokyo. He said: "There has been a dramatic change since 2005, with China getting into the market. The price of Bordeaux has risen dramatically, with region's wine industry now clearly focussed on China. Japan used to be a big Bordeaux market, but the prices have increased so much that Japanese attitudes have definitely changed."

In light of this, it would seem much of the diversification in the market is the result of rising prices spurring consumers to seek cheaper alternatives to traditional favourites. Overall, though, the Japanese wine market has remained buoyant, while witnessing something of a Westernisation of its tastes.

According to Hirose, over the past six years, the Japanese market has grown by around 30%. This is largely down to increasing demand for cheaper, entry-level wines, as well as a revival in the fortunes of the higher-end wine market.

He said: "Four years ago, we couldn't sell a great deal of expensive wins, but thanks to Prime Minister's Abe's success in changing the economy, the Japanese have gotten their confidence back a little bit. As a result, we have started to sell more."

Takashi Hara, International Department General Manager of Belluna, one of Japan's largest online mail-order companies, sees a similar split emerging between cheaper wines and connoisseur wines. His company runs a wine club with some 300,000 members, all of whom subscribe for a year and agree to have a certain number of bottles and types of wine delivered each month. The club prides itself on listening to member feedback, while trying to educate them about new wines.

Assessing the current state of play with the club, he says: "After a one-year period, the number of customers who remain with us is usually around 75% to 80%. Our reps call all of our members every month, and – usually around the tenth month – we ask them whether they want to continue with their current arrangement or try a different plan. While we don't necessarily try to get ours customer to drink more wine, we try to persuade them to drink better wine. It's an education process."

Hara believes the newfound popularity of cheap entry-level table wines is largely down to a change in eating habits. He said: "Early growth in the Japanese wine market was mainly due to fashion, but then people heard polyphenol [an antioxidant found in red wine] was good for the blood, so they switched to red wine for health reasons. Changing food fashions have also played a role. People are now making more Western food at home, something that wine matches well with."

Belluna's wine club prices range from around US$10 to US$400 a bottle, so its focus is very much on middle- to higher-end wines. Explaining its approach, Hara said: "There are basically two wine markets – food culture and wine culture. Our company sells cheap table wine to supermarkets, but not to our club customers. It doesn't sell at all well to them."

Concern about price has helped to push new suppliers of entry-level wines into the market. Chilean wines, for instance, have seen steady growth in this area, while Georgian wines were well received at both Vinexpo and Festivin.

Overall, the first Vinexpo Nippon proved an interesting event, clearly filling a major gap in the expo calendar. While a number participants maintained it was smaller than they had anticipated, others hoped that this industry-focussed event would, in future, be open to the general public.

Photo: French exporters out in force in Tokyo.
French exporters out in force in Tokyo.
Photo: French exporters out in force in Tokyo.
French exporters out in force in Tokyo.

Vinexpo Nippon was held on 1-2 November 2014 at Tokyo's Prince Park Tower Hotel. With 3,200 industry professionals in attendance, the organisers have already committed to repeating the event next year.

Marius Gombrich, Special Correspondent, Tokyo

Content provided by Picture: HKTDC Research
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