In a previous article for the Ian D’Agata Wine Review, I suggested that the question “How is the Chinese market?” may not be the right one. China is not one market. It is a collection of cities, each with its own structure, pace, and underlying logic of consumption.
If Shanghai represents one type of market, Chengdu represents another.
Chengdu is not “another Shanghai”
The recent Sugar & Wine Fair in Chengdu offers a useful lens through which to observe these differences. However, the fair itself does not represent the local Chengdu market. Rather, it temporarily brings together participants from across China, creating a concentrated layer of national supply and demand. It is precisely within this “temporary market” that structural differences—often less visible in daily conditions— become more apparent.
A signal from the trade: from volume to value
Feedback from multiple importers during the fair points to a consistent pattern: While overall foot traffic has declined, transaction quality and average spending per order have increased. This shift suggests a broader transition: The Chinese wine market is moving from a volume-driven model toward a value-driven one. Another structural change is becoming increasingly clear. Wine consumption in China is gradually shifting from institutional demand to individual consumption. As one industry participant noted: “Future growth will no longer be driven by institutional demand, but by consumers choosing to drink for themselves.” This change is not merely quantitative—it is qualitative. It is redefining how and why wine is consumed.
Consumption begins with context as well as knowledge, but in Chengdu things differ
In Shanghai, many consumers enter the wine world through learning:
- tastings
- comparisons
- gradual understanding of styles
In Chengdu, the entry point is different. Wine appears more often in:
- restaurants
- social gatherings
- nightlife
- local dining contexts
In other words, consumption does not begin with understanding wine, but with being in a situation where wine is used. What this changes is consumption logic, a difference in entry point leads to a different consumption model. In Chengdu, wine consumption tends to be immediate, social and context-driven rather than knowledge-driven, comparative and exploratory. And so, because of its scale and frequency, it is a completely different kind of market.
Chengdu is not a marginal or secondary market.With a population exceeding 20 million and a GDP above RMB 2.2 trillion, it is one of China’s largest urban economies. At the same time, its dining culture is highly developed, with strong activity across both high-end and everyday segments. This leads to a key characteristic: Chengdu is not a low-consumption market, but a high-frequency, dining-driven one.
Validation from the trade
Discussions with importers reveal a consistent pattern. In Chengdu, wine sales are closely tied to dining and social occasions. Retail plays a role, but on-trade consumption is often more stable and dynamic. At the same time, easy-drinking styles tend to perform better, mid-range price segments show stronger turnover, brand recognition becomes more important
in group consumption setting. As one importer put it: “Most consumption happens at the table, not on the shelf.” These observations align closely with what can be seen in the market.
Shanghai vs Chengdu: two different market logics
Comparing Shanghai and Chengdu highlights the contrast. In Shanghai, consumption is largely consumer-driven, learning and comparison play a central role, wine bars and by-the-glass programs support exploration. In Chengdu, consumption is driven by dining and distribution channels, wine is embedded in specific occasions, products need to be immediately understandable and usable, This is not simply a difference in maturity: it reflects two distinct market logics. In Shanghai, wine is studied, while in Chengdu, wine is used. Why does this matters for wineries? The issue is not only how to understand China. The more critical point is that treating China as a single market often leads to misaligned strategies. A wine that performs well in Shanghai may not succeed in Chengdu. A strategy built around education may not work in a market driven by dining occasions. When these differences are overlooked, what appears to be a “difficult market” is often simply a misread one.
From market entry to market fit
Understanding these differences is only the first step. The real challenge lies in positioning: Which city to enter? Which product tier to introduce? How to align distribution with consumption context? In China, success is rarely determined by the product alone. It depends on whether the right product is placed in the right city, within the right consumption context.
A more relevant question for many wineries is that the real challenge is not whether to enter China, but whether they have entered the right market. Therefore, there are some questions worth asking: Which city are we actually entering? How does consumption happen in that city? Is our wine meant to be understood, or used? Does our strategy truly fit that environment?
In a final analysis of the wine market reality, Chengdu is not an exception, but is one example of a broader reality. China is not one market. More importantly, it is not one logic.
About Our Work
The Ian D’Agata Wine Culture consulting company, of which I am the CEO and CFO, focuses on the Chinese wine market from a structural and long-term perspective, working closely with wineries, importers and trade partners. Our work centers on market positioning, portfolio structuring, and helping producers better align their wines with specific cities, consumption contexts, and evolving consumer behavior in China. For any further questions or more information on this and other market-related subjects, please contact : contact@iandagatawine.com
