They came, they liked, and they buy when they go home: Harnessing inbound tourists for wine export

Abstract

Australian wine exporters have little direct influence over Chinese consumers because the wines are sold through distributors and retailers. Direct mass advertising is expensive as China’s media landscape is highly fragmented. This project demonstrates that targeting Chinese tourists in Australia can enhance exports by converting the tourists into long-term Australian wine fans and word-of-mouth ambassadors. Chinese tourists used their positive tourism experience to imbue their image of Australian wine, especially at wine-congruent locations such as vineyards and restaurants. However, upon returning to China, the effects decayed over time. Hence, follow-up marketing efforts are needed to stop or slow the decay.

Summary

This study draw on research into country-of-origin effects to contend that Australian wine exporters should target and harness Chinese tourists, while they are physically in Australia, to enhance the competitiveness of their export to China. This project in essence is a pull-strategy to develop long-term Chinese consumers of Australian wine, and it offers several practical implications and benefits to the Australian wine companies exporting or planning to export to China. Targeting Chinese tourists in Australia affords Australian wine exporters direct access to Chinese consumers, which is otherwise difficult to do in China. With about 700,000 Chinese tourist arrivals annually and growing, this is a substantially large yet untapped asset. As the tourists come from different cities and regions in China, and yet congregate in a few prime tourist locations (e.g., Sydney), targeting them is a cost-effective way to access markets across the wide geographical expanse of China. As China possesses a relatively collectivistic culture, word-of-mouth communication may be an important marketing channel, and returned tourists with favourable impression of Australian wine may become effective ambassadors for the wine. The vast majority of Chinese tourists congregate in major Australian cities like Sydney, Melbourne, Cairns, Gold Coast and increasingly Adelaide. There are many easily accessible opportunities and locations in these cities that can expose Chinese tourists to Australian wine, thereby facilitating planning and execution. Furthermore, better outcomes are achieved when the wine exposure is designed as part of Chinese visitors’ tourism experience, rather than just focusing on wine. Chinese tourists’ perceived images of Australian wine and tour destination were not distorted by seasonal factors or fluctuations. Chinese tourist who are exposed to wine while on tour are more likely to purchase Australian wine when they returned to China. Hence, targeting them in Australia has follow-on sales benefits. Although targeting Chinese tourists while they are in Australia can bring about numerous benefits to Australian wine exporters, a key shortcoming is the decay of the tourism effects, where their perceived image and purchase probability of Australian wine eroded over time, after the tourists had returned to China. The tourism effects evident when the tourists were physically in Australia seem to have worn off over time to the point that there are no difference between visitors and non-visitors. Nonetheless, it suggests that Australian wine exporters need to follow up on marketing to or communicating with Chinese tourists after they have returned to China. Doing so will maintain, or at least retard the decay of, the initial high perceived image and purchase probability.

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This content is restricted to wine exporters and levy-payers. Some reports are available for purchase to non-levy payers/exporters.