E&J Gallo signs three-year deal with China’s Alibaba Group

California’s E. & J. Gallo has confirmed a three-year strategic partnership with Chinese retail giant Alibaba Group – the world’s largest online and e-commerce company – as it positions itself for further growth in the Asia market.

E&J Gallo’s Tmall shop will open on 9 September

As part of the agreement, a new E&J Gallo Winery flagship store will open later this year on Alibaba’s Tmall, China’s largest B2C platform, and its wines will also be featured on Tmall supermarkets, Hema and RT-Mart.

While Gallo has partnered with Tmall in the past for its Carlo Rossi, Peter Vella and Gallo Family Vineyards brands, the new E&J Gallo flagship store will feature more than 20 of Gallo’s premium wine brands including Apothic, Carnivor, Dark Horse, Gallo Signature Series, Orin Swift, La Marca, William Hill Estate Winery, J Vineyards, MacMurray Estate Vineyards.

“We are very excited to continue our on-going partnership and collaboration with Alibaba Group,” said Bill McMorran, vice president and general manager for Gallo Asia.

“As we have witnessed the rising sophistication of wine consumers in China, we are continuously looking for new ways to meet growing consumer demand. We are thrilled to offer more than 20 of our premium brands on Tmall, bringing high-quality, great-tasting wines to consumers in China.”

GROWTH IN CHINA

According to Vinexpo, world wine consumption is set to reach a record global value of $224.5 billion by 2021, driven by the US and China, according to a joint report by Vinexpo and IWSR.

In terms of volume, the world’s volume sales is projected to reach 2.66 billion 9-litre cases by 2021, with growth by two of the biggest wine markets, China and the US, expected to offset declines in other parts of the world, particularly in Europe.

Over the next five years, China will become the world’s second largest market for wine, behind the US, with Chinese consumption expected to rise by over one third to $23 billion over the next five years when it will reach volume of 192 million cases.

Meanwhile, the Asia-Pacific region and Hong Kong wine markets are projected to grow over the next five years from $29 billion in 2016 to $40.8 billion by 2021.

The E&J Gallo Winery flagship store will launch on September 9 on Tmall.