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.

Now I am quite curious as in what do you guys think about the perception of prosecco in the Chinese market? Do you think that Chinese consumers in general have the basic awareness of prosecco, for example, the prosecco region, what prosecco is, or any of the relevant information, Daisy?

I would say to understand Chinese consumers you for sure want to understand what is your niche. So for sure there are a lot of people who might not even know about the name prosecco.

True.

In that case, this is not really our target audience. Right？

So let's assume there's a…

I probably beg to differ, because I would see them as potential customers if they don't know prosecco.

Yeah. They can be potential customer, for the sake of this call, I mean for the sake of answering your question, this is not the target audience we are talking about, right? They don't know prosecco as a category.

Well, that's true. Sometimes they don't know exactly where the prosecco come from.

Yeah. What I’ve seen is they know they've heard of Italian wine and then they especially female customers, they know sparkling as like Moscato, probably, they're really, really sweet ones. They don't perhaps have much of an understanding or awareness of prosecco. You're right, Daisy.

So I would rather bank that for the opportunity part instead of understanding their perception, let's say there's a group of Chinese a pretty big group that have very little awareness of prosecco that is our potential customers.

Yeah.

Then we move on to the next category of consumers who are the ones that they know prosecco. They may even know prosecco is from Italy. And then to be more sophisticated, they may even think about which area of production of prosecco. Yeah. So if we look at consumers in this different prosecco understanding journey, then we can understand what is their perception at that stage. And where do we want them to move towards.

Exactly.

How do we help them increase their understanding awareness and improve their perception of prosecco in the future? So I would actually first identify the different consumer groups with their very different perception of prosecco and work towards that, because you don't want to be telling a novice about the region, the flavor profile and this and that, they might feel a little bit confused.

Overwhelmed.

Confused. But if you come back in 2 or 3 years, they may already be an expert if they really love that drink.

I love the word that you're using. It's like a consumer journey of realization of gaining awareness in the particular consumer products i.e. prosecco here. Very interesting. Thank you, Daisy.

What about Matteo? What do you think dealing with Chinese consumers wine consumers directly? What do you think is their understanding awareness or perception of prosecco?

I mean, it's very kind of varied by region and tier cities, right? Like Daisy says I mean a lot of them maybe they don't know what the name of prosecco is, or where is the prosecco coming from. And like to say that's definitely not target that we have into the... but again is a potential target. And also some of them regarded as prosecco as affordable drinks and for usually more expert wine drinkers. They don't really like to be or to try the wine or like to get into that.

There is like a sweet spot. Again, I think in more like probably young generations and people that have definitely traveled in Italy would just help, because again, I’m from the prosecco area and sometimes I feel like that people don't know where actually the prosecco is coming from. They asked me what is prosecco Veneto. Hey, where is Veneto, it's like next to Tuscany. No, it's on the north east side, Venice.

So usually I just mentioned Venice and they said “oh, okay”. Then that's the reason.

It's, I think in my opinion out there is still the work to do, and definitely there are like more educational work to do, of course like Daisy said, you can't really go there and say “hey, now we have these like five different crews of this prosecco, ten different crews of their prosecco”. So to mean, people are not gonna actually be interested, so we need to start to like to explain to them what is prosecco, where it's coming from, and why is it different from other products. That's the main thing to do. Honestly. At the beginning as a first step.

Yeah.

I would like to add that for prosecco has a huge advantage in the one category, because it's the least intimidating choice of sparkling wine.

Yeah.

Yeah.

It's much less intimidating. I do agree with you, in terms of the price range, in terms of the taste, like you guys both mentioned. It's really accessible, it's really easy drinking and it's also very just fun. It's very lighthearted, it's fun, it's a fun drink.

Before today's recording, when I was talking with both of you mentioned that in order to promote prosecco to the Chinese consumers, you start with explaining the area, the prosecco region which I know it's actually what you call it the Appellation like it's like a trademarked for lack of a better word. It's like a trademarked region. Right? And Matteo, can you elaborate on that? And also why do you think it's important to explain the area before each individual brands?

Yeah, I mean it's the prosecco, it's a trademark. And actually recently China protected the trademark in China. So no one, no other products can be called prosecco or named prosecco if it doesn't come from that area specific area in Veneto. This is very important because we have been this kind of like let's say trade not trade war, but more like a “fight” between Italy and Australia, as Australians were basically making prosecco; but for them, the problem for them is prosecco is more like the name of the grape, it’s not the name of a region, for us, it’s a registered trademark for the region and the grape, which everyone I think but not everyone knows, but the expert knows actually, the name of the grape of prosecco now is Glera.

So that's the original name. So there was this “fight” and Australians were keeping selling prosecco as a wine which was protected and a trademark. So finally, and you could actually find prosecco wine made in Australia here in China, which was not really good.

Finally, the trademark and protection, which is the first step to actually then takes the consumers to finally, if you see the name prosecco in a label, it’s not just a random name that given to a random wine, they come from Australia or anywhere else. It's an actually a region, a region of productions of prosecco in Italy which is Veneto. And then you start from there. I mean I think you need to have the consumers visualize these area or region where is or how this come from.

The area.

Okay. So these guys, these products from Veneto is the region that where Venice is located, which is Venice. You know. It's a way to …

Everybody knows Venice.

So if you combine these two things together, you are right away, you have a consumer that is hooked into the products, and understand where the products come from. I think this is probably the main thing that let's say we have to do engaging consumers.

Explain the area. And also to sort of reinforce the perception, an awareness of this whole region and it's everything relating to it among Chinese consumers. Now I’m also going to direct this question to Daisy, as a Chinese you know market inside out.

So I am going to ask you, what do you think is the general response from Chinese consumers when they hear this whole idea of like a trademarked region, for lack of a better comparison, it's like when people hear champagne, they immediately think about champagne region. Do you think that adds to, I don't know, like I would say consumer confidence or like a loyalty type of thing?

I would, looking into different beverage categories such as coffee or wine. It's really a matter of again back to the earlier question in which stage of the consumer journey or sophistication this particular person is in. If I am very into coffee, I start to look into it. I know that I like the flavor profile from Ethiopia or even up to the Yirgacheffe area. because I’m really into coffee. I know all the... that I have tried all the different countries of origin, say Kenya or Colombia or Panama, I have a certain understanding of okay, in this region, what is the flavor profile? Do I like it? In Ethiopia, the coffee in general is more floral, more citrusy, and I like that for certain brewing method.

So when I go into a coffee shop, I would look for that immediately. Today I want to have a citrusy flavor coffee, but that requires years of education and also the interest in that category; or wine, you have to drink many years, many different wines to know I like Burgundy or I like, I’m more of a Bordeaux person.

I see.

In this case, we need to understand the consumers how knowledgeable they are. And how much do they know about their own palate? Because flavor is such a personal preference.

True, that's true.

In this case, I’m also quite curious whether promoting the appellation are the place of origin of a privilege would help the sales of that products. But rather is an indication of okay, if you're getting prosecco from this region, you can kind of set certain expectation of the flavor or even the pricing. We know that Bordeaux wine can be quite premium. Or Burgundy wine you have to practice certain rituals in terms of you have a burgundy wine glass. This is for a very small specific niche audience. Most of the audience, it's more about “okay, I look at the price. I kind of have certain expectation of the flavor. If it's good enough, it's good for me.” No, we need to understand what kind of audience we are working with and where they are with their education or interests, what level.

Still depends on the stage of their consumer journey.

But I do feel like for certain people like take me as an example, I know I’m not probably not like a typical consumer. I drink wine. I don't really know that much. I do go to wine tasting and all that I’m interested in knowing new things, like for me, knowing that it's like a trademarked region, it's like there's an appellation relating to it, does give me a certain level of guarantee that this is gonna be good, because I only trust all of these quality prosecco would be from the prosecco regions, like I'll trust champagne, because they're from a specific region. I know their criteria, I know their rules, regulations, relating to it.

So for me a normal like an average consumer, this gives me more confidence in trusting perhaps the quality of it.

That's a really great point, that’s really a great point. So you want to associate the origin as a stem for quality. In this case is not so much about the origin itself, it’s about “wow, that origin is a standard, guarantees my position.”

A standard, guarantees standard. Exactly, exactly. When they don't have a developed palate, perhaps this is more important, because for people who are not well versed in wine, they don't have like a developed palate. How do they choose wine? If you think about it? How do they choose wine?

There's so many like bad wines out there to be honest. And like when I first started drinking wine, I’ve paid quite a bit and had really bad wines. I think for me as a consumer, this... because I’m not an expert, I cannot see things from Matteo’s point of view, for instance, because he grew up in this world, and for me, a normal consumer, I need some level of guarantee, what do you think, Matteo?

I have a great example literally had this discussion probably 5 hours ago. And so I have a few friends, I mean they’re not actually interested in wines and they’re hanging out with me.

And I’m telling you after a year, probably a year and a half, they came back to me and they say, “hey, now I realize one thing. I know a little more about wines. And now when I go and ask for wine by the glass or by bottle, I have to taste the wine first. And I recognize the way if the wine is good or not. When I buy something, I don't really look for the cheapest one or a very entry level price, but I try to go like a little bit over my normal standards and they spend like more. But I actually feel like a drink less because I enjoy more the wine, because thanks to what you say all the time when we were hanging out. I kind of feel I know more, and that's pretty fascinating to me, because that happened, and it is happening on a, not a daily basis, but on a monthly basis that I have people coming to me and say, hey, now I feel like I know more. Then I know I can recognize a label, I can recognize the name of wine, I can recognize a region.”

It's fascinating because then actually they're just at the beginning now, right? But they are actually recognizing the labels and the brands. And so when they go to buy something, so they take that specific brand as a benchmark now to actually explore other brands for the same region without even like my advice which is good.

I see.

It took a year and a half, probably two years of me hanging out with them closely. I think if we can repeat this a process with consumers that you can't really hang out with like 3,000 people every month. It's interesting. So it's a long term process.

It is a long terms process. But what I’m also hearing is a very interesting point in the example that you just gave. It's not really like these sorts of like the super liminal type of traditional wine tasting classes. You come, you just spend 2 hours getting educated on wine, and there's like a lecturer teaching you, sommelier teaching you. But it's more like just chatting, hanging out like friends, and then just sort of almost like subliminally, you're getting the message which is moving us on to the next discussion point, which I think it's very interesting that you see this sort of lifestyle, or scenario based promotion of products.