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ALDI : From Premium Labels to Bargain Bottles

vino-joy.com by Morris Cai23/10/2024  

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Once a crucial destination for fine wines 20 years ago, when China began to attract attention from the global wine industry, the market is now a “colosseum” for low-priced wines due to a downgrading trend in the consumer market. 

Recently, ALDI, the German supermarket giant introduced a wine offer of CNY 99 (US$13.9) per case of six bottles, following the inexpensive options offered by Saizeriya, a budget-friend restaurant that has become known to the public as a “drinking paradise” for Chinese customers by selling wines priced at RMB 30 to 50 per bottle.

ALDI launched the Chilean Central Valley Cabernet Sauvignon Dry Red Wine (750ml, 12.5% vol) at RMB 99 per case on October 9 in Shanghai, the only city where ALDI operates in China, with more than 50 stores. With an average price slightly higher than US$2 per bottle, this wine is part of its Super-Value Series, ALDI’s budget-friendly store brand of daily consumables. Earlier in June, the Super-Value Series launched an affordable Baijiu priced at RMB 9.9 (US$0.14), which sold out shortly after its release.

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The so-called “996” wine—priced at RMB 99 for six bottles and named to play on the “996” work culture—is not new in China: online retailers have been selling such ultra-low-priced wines for years. However, ALDI might be the first to offer “996” wine in offline stores. Unlike some online “996” wines, this wine does not mislead consumers by marketing itself as an imported item. Instead, ALDI specifies its origin as Yantai, Shandong province, the northern Chinese city where the Chilean wine is bottled.

The supplier of this product is Shanghai Vin Maison, a subsidiary of Ninecoast Network Technology Co. Ltd. Shanghai (referred to as “Ninecoast”), one of China’s Top 50 Wine Importers specializing in bulk wine  imports. The company’s CEO, Zhang Haixiao, stated that this ALDI wine is produced by Ninecoast’s wine production company in Yantai, adhering to ALDI’s principle of a cost-efficient supply chain without compromising on quality.

“Within ALDI’s budget range, they choose the bulk wine of the highest quality. ALDI aims to create a bestselling wine product,” Zhang said. Indeed, the wine has become a hit for Aldi. In less than a month since the launch of the “996” wine, ALDI is selling hundreds of cases daily.

Interestingly, before ALDI introduced ultra-low-priced wines in supermarkets, Saizeriya, a Japanese restaurant chain specializing in affordable Western cuisine, offered a variety of low-priced wines ranging from RMB 30 to 50 (US$ 4.21 to 7.02) per bottle in its Chinese branches. This strategy successfully appealed to a broad audience, earning it the nickname “izakaya for the middle-aged.”

A feature story by Life Lab, a WeChat official account affiliated with the renowned Chinese publishing house Joint Publishing, explained that middle-aged people flocked to Saizeriya to drink wine for its ambiance, decent environment, and affordable prices—typically under RMB 100 (US$14.04) per person.

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“In the urban landscape, where one fears becoming a mere nomad shuttling between office and home, the seasoned middle-aged soul has already unearthed a serene haven amid the city’s bustling streets and tranquil corners—a personal sanctuary, Saizeriya,” Life Lab described, capturing the restaurant’s position in a romantic light.

Vino Joy News has since examined Saizeriya’s menu and found that its wine prices are cheaper than those at most restaurants. Their Blue Nun sparkling wine is priced at RMB 36 (US$5.05) per bottle, while both dry red and dry white wines are priced at RMB 58 (US$ 8.14) per bottle. A glass costs RMB 6 or 8 (US$ 0.84 or 1.12), and a 250ml carafe is priced at RMB 16 (US$ 2.24).

Founded in Japan in 1967 and entering China in 2003, Saizeriya has concentrated its Chinese locations in the Yangtze River Delta region around Shanghai. Due to its focus on affordable Italian cuisine, the restaurant is often referred to as the “poor man’s restaurant”. Interestingly, ALDI is also dubbed the “poor man’s supermarket.”

Regarding ALDI’s introduction of “996” wines and Saizeriya’s popular RMB 36 per bottle wine, Zhang believes that while consumer downgrading may reflect a challenging economic climate, it ultimately benefits the popularization of wine in the Chinese market as more consumers seek affordable options.

Zhang believes that while consumer downgrading may reflect a challenging economic climate, it ultimately benefits the popularization of wine in the Chinese market as more consumers seek affordable options.

“About 90% of ALDI’s products are self-operated, and their strong supply chain capability gives consumers confidence in their purchases. Therefore, ALDI’s launch of CNY 99 for six bottles of wine undoubtedly instills more trust than e-commerce,” Zhang said.

However, Feng Lihua, a seasoned professional in the alcoholic beverage retail sector, disagrees with the notion that consumer downgrading is the sole explanation for the popularity of cheap wines.

“The prevalence of low-priced wines is more based on the positioning of ALDI and Saizeriya. The current trend in the wine industry is not about switching from drinking CNY 100 wines to CNY 50 ones; rather, it reflects a reduction in the frequency of purchases,” Feng said. “Even some high-end Chinese Baijiu has undergone a series of price reductions, yet sales volume remains low because consumers believe there is still room for further price drops.”

Zhang also acknowledges that the ultra-low-budget wine trend may not appeal to wine enthusiasts, but it aims to attract a broader audience. He noted that seasoned wine enthusiasts are unlikely to purchase ALDI’s offerings, as ALDI and Saizeriya primarily appeal to mass consumers who represent future wine buyers.

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