Treasury Wine Estates chief executive Tim Ford is fighting to reinstate Penfolds’ former status as China’s top luxury drop as the $10 billion wine giant doubles its headcount in Shanghai and flags global price increases that will kick in from July.
After China dropped its punishing tariffs on Australian wine on March 28, Treasury Wine has been recruiting to increase headcount in China from 100 to 200, primarily in sales and marketing to reinvigorate Penfolds’ luxury brand status.
Penfolds will have to contend with Bordeaux’s Chateau Lafite Rothschild to reclaim the title of China’s top luxury brand.Credit: Qilai Shen
“It’s the investment behind the brand, how we bring that brand of life, how we execute in store. Penfolds does an amazing job of what we call the in-store theatre of the brand. The Chinese consumer loves it,” Ford told this masthead.
Treasury Wine is hoping to reconnect with “heartland” customers and attract new ones after having broken down its consumers into categories, distinguishing “new luxuriant” drinkers – generally younger and want a luxury brand experience – from “classic connoisseurs”, who enjoy the theatre of tastings, dinners and grand events.
“We think we understand that better than anyone else,” said Ford. “How you execute against that is where we see the brand succeeding and growing and being very targeted in how we’re going after those consumers.”
At its pre-pandemic height before diplomatic ties between China and Australia soured, China was Treasury Wine’s most lucrative market – accounting for about 30 per cent of total earnings.
From July 1, Treasury Wine will increase prices by an average of 6 per cent for customers around the world, including Australia, which Ford said was based on global demand and supply across a three-four year period.
“We want to continue to build the brand and sell more of the wines consumers are prepared to pay.”
Source Agencies
