Adam Ivor

Adam Ivor, co-founder and operations director of Gliding Eagle, advises placing a welcome sign written in Chinese in tasting rooms, such as the one on the screen behind him, to help make Chinese visitors feel at ease.

The number of visitors from China to California is growing and their taste for Napa wines is growing, too. How best to reach and treat these consumers both here and their home was among the discussions at a recent CANVAS workshop.

China is already the No. 1 international spender in the United States, surpassing Canada this year, according to the U.S. Department of Commerce, said Charlie Gu, director of China Luxury Advisors.

“California is also a major beneficiary. California welcomed nearly 1 million Chinese visitors in 2014, a 21.6 percent increase over 2013, making China the largest source of overseas visitors for the state. Chinese visitors spent more than $2.5 billion in the state in 2014,” Gu said.

Gu was one of four panelists who presented at the “Serving the Chinese Visitor” workshop hosted by CANVAS (Concierge Alliance of Napa Valley and Sonoma) held at Cameo Cinema on Aug. 30.

A change in the visa policy that took place in November 2014, creating a 10-year reciprocal business and tourist visa between the U.S. and China, is largely responsible for the visitor increase. The visa can be automatically renewed, which is a “game changer,” Gu said, and makes it easier for Chinese visitors to come to the U.S.

And 2016 is the year of U.S. China Travel and Tourism, with the two governments “promoting travel between the two countries,” he said.

China’s wealth has soared over the past decades as well, panelists said.

“The past 30 years their middle class went from 10 million middle class to 300 million middle class. Nobody’s ever done that before. And they’re proud of that fact, and they should be proud of that,” said John Stallcup of Stallcup and Associates.

“Seventy-three percent of Chinese luxury shoppers are under 45, more than 50 percent under 35. The average age of a Chinese millionaire is 34, while in the U.S. it is 54,” he said.

Stallcup and Gu agreed that through the visa program Chinese visitors are likely to be repeat visitors, and those repeat visitors tend to spend more. Their first trip to California is likely to come through the two gateway cities — San Francisco and Los Angeles — while over consecutive trips the Chinese visitor will expand and explore areas “where they can spend more time, like Napa Valley,” Gu said.

Travel is considered educational, Gu said, and repeat visitors tend to travel five to eight times a year. They also travel in smaller groups instead of the tour-guided busloads that used to come to the states.

About “half of the Chinese outbound travelers are now millennials,” he said, with about two-thirds of this group belonging to the “high income bracket.”

“Chinese millennials prefer to be ‘inspired’ rather than ‘persuaded’, and they highly value authenticity in content and are more likely to trust peer-generated content on social media than from traditional media channels. They consider lodging part of their leisure experience and are willing to pay for something unique,” Gu said.

Their definition of luxury is shifting from “conspicuous spending to experiential luxury” and “mainland Chinese consumers plan to up their spending on travel than on luxury goods this year, marking the second year this has been the case,” he said.

“They are sophisticated, want exclusivity in quality, craftsmanship and style,” Stallcup said.

Repeat visitors are typically young, educated, fashionable and sophisticated, Stallcup said, and will spend 10 percent of their annual income on luxury commodities.

Fine wine is among the luxury goods Chinese visitors want to purchase, often as a gift for family or friends. Expensive red wines such as Chateau Petrus, Lafite, Opus, Cask 23, or other limited production wines are part of “status gifting,” and seldom consumed for pleasure, Stallcup said.

Wines that the Chinese actually drink are in the under-$10 category, fruit-forward reds with tea tannins, or sweet, he said. Their palettes are “attuned” to the “mouthfeel of tea tannins,” and as a population the Chinese have more “supertasters” than any other group. In a large group such as the 50 or so people in attendance at the workshop, there will be about 25 percent Anglo supertasters compared to about 65 to 70 percent for Chinese, Stallcup said.

“They just have more taste buds than we do,” he said.

Stallcup was the Asian Concierge at Stag’s Leap for four years and shared some tips on interacting with Chinese visitors in the tasting room.

Show respect for them at all times and address the eldest in the group first. The oldest person is always the “boss,” but not always male, he said. Be politically correct and don’t bring up old stereotypes, and don’t confuse a Chinese visitor with a Korean or Japanese or any other Asian. If you don’t know where they are from, just don’t say anything about it, he advised.

Don’t assume that they don’t understand you. “If you say, ‘Welcome to X winery, here’s our tasting menu, the cost is $30 and it’s for these wines’ and then you later remind them it costs $30, you just insulted them,” Stallcup said.

They’re always on a schedule, so make it easier for them to keep to it, he said. And while they are at the winery make sure to have free, easy access to Wi-Fi – roaming charges from China are expensive, he said – and have props for selfies.

Stallcup also recommends having something to give them as a gift as a “thank you.”

“Luxury goods are what they look for but if you pay retail for something you ‘lose face.’ And it’s not about giving them 30 percent off, it’s about giving them something of value that they can show,” he said.

He told a story about selling $20,000 worth of wine to a Chinese customer and gifting a bottle of sauvignon blanc and a bottle opener to the purchaser, and giving the members of his party a magnet. “They were overjoyed,” he said.

The Chinese marketplace is flooded with “fake” products, panelists said, so they appreciate authenticity. And California wine is often purchased at retail value here, but sold there for multiple times over what was paid originally.

“They are an extremely skeptical consumer base. If every time you went to purchase something here at home and 40 percent of the time it was fake,” you’d be skeptical too, said Adam Ivor, a winemaker who co-founded Gliding Eagle, a company that ships directly to China.

As a winemaker, it bothers him to think that he spent two and a half years making a $100 bottle of wine for which a distributor wants to pay him only $50, and then it sits on a ship for 60 to 90 days traveling to China in conditions that he can’t control and then gets re-sold for $300.

Gliding Eagle is his solution to that by specializing in logistics, authenticity and transparency.

“I was not about to put it on a truck and have it go into a black hole. I don’t know who’s buying it, what they’re paying for it, how it’s stored, how it’s transported, are they telling my brand’s story, how frequently, if it gets told is it getting told properly,” he said. “I don’t want a distributor telling someone how I made that bottle of wine. No one can tell the consumer how I made that bottle of wine better than I can.”

The distributor method in China is “fragmented and murky,” he said, so Gliding Eagle is working to be the conduit between the Chinese consumer and the wine industry. Purchasing between the two economies can be tricky, he said, but both Ivor and Gu said WeChat is the place to do business and communicate with the Chinese.

“WeChat is the Facebook of China, the Twitter of China,” Ivor said. It is also a mobile payment system.

Gu said there are more than “700 million monthly active users” on WeChat, and “55 percent of users open WeChat more than 10 times a day.”

Through WeChat consumers can directly look up more information about your wine, and using 30-second or one-minute videos provide a platform for them to learn more.

“QR codes are huge,” he said. “I can scan and learn about your wine in Chinese on my own.”

It’s all about reducing barriers to purchasing, Ivor added.

He also recommended keeping pricing simple and bundle the pricing. Don’t, for example, list the price of the wine, plus the price of shipping, and then the taxes, and anything else that could be added. Instead list the case price in total so it’s easy to understand. Also, stick to just a few wines that are the most likely buys.

“You don’t want decision fatigue,” he said.

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