Donald St. Pierre: wine’s gateway to China?
Donald St. Pierre, an American and a prominent importer of wine to China, receives an extensive profile in the current issue of the New Yorker (the food issue). He arrived in the country in 1985 thanks to a position with American Jeep and in 1996 he started importing wines after forays into other things such as scrap metal, lingerie, and Chinese and Russian ammunition. Here’s a taste of the early days:
When the St. Pierres began importing wine, after buying a Hong Kong shelf company called Asia Solutions Corporation, the also created a product of their own. The family was Canadian by birth, but St. Pierre figured, “God damn, let’s use our French name.” Chateau St. Pierre was California bulk red wine, bottled at a factory in Beijing. It bore a label with the stencilled image of a chateau, which the importers had copied from a coffee-table book. No bottle cost more than forty-five yuan–less than six dollars at the time.
At the beginning they also had a fantastically successful promotion selling two bottles of wine and tie gift boxes. Now they also import Gaja, Penfold’s Grange, and Guigal among many others.
The story provides a small window into wine consumption in China too. Red wine has been called “red liquor” if only to distinguish it from baiju, a “ferocious grain alcohol.” But in the 1990s, the authorities wanted to divert grain back to food production, the story reports, and upgrade the quality of domestic wine. Baiju was banned at ministerial banquets and wine import duties were lowered. But in this video on the newyorker.com, Donald St. Pierre, Jr. says culture of alcohol consumption write large often takes that the ultimate sign of respect for a guest is to down the drink in a single gulp, a tradition known locally as “ganbei.” And apparently for decades, Chinese wine was made in “enormous, state-run industrial wineries [that] blended grapes with chemicals and coloring.” Hmm, doesn’t sound like something worth sipping.
The picture to the right is of Don Sr via Grape Wall of China, an English-language site about the wine scene in China. (Update: Jim Boyce of Grape Wall posts some useful insights in the comments section)
On November 21st, 2009 at 3:56 am ,jim boyce wrote:
Hi Tyler,
The New Yorker article is intriguing for its insights into one of the — arguably *the* — characters of the wine scene here, but mostly focuses on the late 1990s, when the company received an infusion of capital from Swarovski and when it undertook that necktie and bottle promotion you note, and 2008, when Don Jr was detained by Customs for 28 days as a result of an industry-wide investigation as to how wine imports were being valued (or undervalued, as the case might be). There is not much info re the eight years in between to explain just how ASC rose to the top. In short, I’d attribute it to superior logistics, customer service, events (I’d rank numerous ASC wine dinners among my top ten), communciations (ASC invested in PR like no other company and Don Sr has always been quick to answer emails, even from a small potatoes blogger like me), and ruthless sales tactics.
In any case, the scene has changed so much in the past five years – an explosion of wine distributors, the spread of wine into smaller markets, increased competition for hotel, bar, and restaurants wine lists that make it hard for one company to get a monopoly – that it’d be difficult for another ASC to rise again.
And for his part, Don Sr has retired from the scene for all intensive purpose.
But it’s still a good read, given the bizarre past of St. Pierre – after all, what are the odds of a key figure of the China wine scene also being part of the largest ammunition raid in U.S. history?
For more on Don Jr, I’d also recommend this interview in Wine Business International:
http://www.wine-business-international.com/Interviews_Interview_with_Don_St_Pierre.html
Cheers, Jim
Disclosure: I have met both Don Sr and Don Jr on several occasions and talked to Evan Osnos, the author of the article, several times while he was writing it.
On November 21st, 2009 at 8:11 am ,Craig wrote:
“industrial wineries [that] blended grapes with chemicals and coloring.â€
Sounds like the same thing that most of the big wineries here are doing today, right under our noses.
http://www.latimes.com/features/food/la-fo-newwine28mar28,3,7229987,full.story
On November 21st, 2009 at 8:58 am ,EVO wrote:
Funny you mention “ganbeiâ€, as I had a recent recollection and could not recall the word.
In the early days(2001)of LocalWineEvents.com, I received a posting for an event in Zhuhai China and an initiation to attend. I jokingly said I would be glad to attend if they paid my way and they said okay.
We were gathered for hosted dinner one evening and one of the Australian exhibitors had brought along a bottle of La Grange. I, two other Americans and 3 or 4 Aussies who were sharing small pours from the bottle when our Chinese host, “The General†arrived. He was a short bulldog of a man with military bearing and medals on his coat, accompanied by two young girls to translate. As we made introductions, the General was handed a glass of the La Grange we were sipping. Without hesitation, he lifted the glass with a curt “ganbei†and downed it in one gulp.
As we stood staring for a moment, unsure of what to do, one translator explained that we too, needed to gulp our wine, which of course none of us wanted to do.
We all raised our glass to “ganbei†and gulped our La Grange, then tried to explain through translators why we would rather not do that with fine wine.
It made no difference, as the dinner was punctuated throughout the evening with glasses raised to “ganbei†and contents gulped regardless of what it was.
Quite an evening, I must say.
EVO
On November 21st, 2009 at 11:03 am ,Chris Robinson wrote:
ASC is hardly the company it may have been in the early days of the wine trade in China, in fact it is generally recognized now as a bit of an “also ran”, the point being they had no real strategy – and frankly were benefiting immensely from early market entry. The market in China has changed so markedly that no one would claim to be able to meet the diverse range of market demand in China. Leaving aside the huge differences between provinces in China it is clear that there are two market extremes for imported wines – the cheap and cheerful, velvety textured, red only wine, under US$10 and the LafMoutTrus segment where unless it has a Parker 95 plus US$100 plus retail price and can be pronounced by any drunken cadre over a corruption-funded dinner it is going nowhere. The Hong Kong auction market has to be the best indicator of the stupidity of this latter segment. A narrow range of wines sell to mainland Chinese buyers at auction some 20-30% above the retail prices one can pay for them in Hong Kong on the same day as the auction. This is all about one thing the mainland Chinese are masters at – showing off. It will be many years before a serious middle tier develops in China – and therefore many years before any wine marketer a la the West can claim to be a China success story. One amusing experience sums this up. At a recent auction in Hong Kong a rather attractive young mainland Chinese lady of about 20 years of age sat next to me. She was clearly struggling with the English and all the action of the auction. Being a “nice guy” I offered her a few tips and introduced her to some of the things she needed to understand if she was going to bid. She then told me her boyfriend had given her the equivalent of US$100K to buy wine and she was there to buy “Beetroot”, which of course rather threw me. it was only some 20 lots later that I discovered beetroot was in fact Petrus. When mistresses no longer bid on Petrus at auctions we can probably then conclude the wine industry in China may be appraaching maturity, until then today’s heroes are almost certainly tomorrow’s losers. As the Chinese would say, the industry is best described as ” playing a violin in front of a cow”. It will be years before serious wine interest catches up with the marketing bull…
On November 21st, 2009 at 5:08 pm ,Dr. Vino wrote:
@Jim – thanks for the info. Interesting and not surprising that the Chinese market has moved along quickly.
@Craig – heh
@EVO – funny!
@Chris – wow, great vignette and insight. Why do you think the bidders pay so much above retail–prestige of auction? Obliviousness to retail prices?
On November 22nd, 2009 at 7:07 am ,jim boyce wrote:
Chris, I don’t think it’s fair to say that ASC had “no real strategy.” There were firms other than ASC that got into the wine game early and did not do as well. When I arrived in Beijing about five years ago, Montrose, Summergate and ASC were the big three here. In re Montrose, I once bought a wine at their shop, got home and found the cork rotten all the way through, and then mentioned it to one of their key people later — she pretty much didn’t seem to care. Inertia that symbolized my general experience with Montrose. Summergate was the first company I ever contacted re buying wine: I had to find someone who knew someone there in order to get an email address and – since they did not have a functioning Web site and still did not until about a year ago – was then sent a pdf that I was to print off and fax back with my order. Not very convenient. ASC, on the other hand, organized many good events, had its portfolio online, quickly responded to queries, and did prompt delivery — it might not sound like a groundbreaking strategy but making it easy for people to try and buy wines does help to move product (so does a ruthless sales staff that pursues monopolies on wine lists, which isn’t exactly consumer friendly in my eyes). Anyway, as noted above, the wine scene here has been quickly shifting in recent years and is simply much more competitive, but that doesn’t lessen the role of ASC in that scene’s history.
Cheers, Jim
On November 22nd, 2009 at 7:37 am ,jim boyce wrote:
Re “ganbei”, I’ve visited wineries in Xinjiang, Ningxia, and Hebei in recent months and most of the dinners, and some of the lunches, included many rounds of “bottoms up” drinking – whether of wine or the local firewater, baijiu.
The worst case: At a winery ~90 minutes outside Beijing. A friend and I figured we could escape ganbei-ing given we had the excuse of having to drive back to Beijing that night. Not so fast: The winery arranged hotel rooms for us – which meant a free-for-all ganbei session that night.
The best: In Xinjiang. During a multi-day tour with a group of foreign wine experts, Peter Hayes of the OIV gently noted in a speech that many people tend to sip and savor wine instead of gulp it. At that night’s dinner, I ended up doing a few ceremonial ganbeis.
I should add that many of my Chinese friends and acquaintances enjoy ganbei-ing no more than I do, but there is strong social pressure to return a ganbei request.
Cheers, Jim
On November 23rd, 2009 at 12:38 am ,chris robinson wrote:
Chinese buyers at auction are just there to show off. They know 5-6 brands and see this as an opportunity to bask in the glow of winning a bid. The retail price is irrelevant, it is entirely situational and across a limited array of wines e.g. DRC, Lafite, Petrus, Mouton, etc. Super seconds hardly rate.
As to Ganbei, anyone in the petroleum sector, which takes you to all the worst locations in China, will know how much you have to drink to keep up with these guys. The spirit is generally crap, very often from corn and not the better quality sorghum. And I swear almost no one at the table actually enjoys the stuff. It is all about doing things together.
Alcohol levels are often 50% plus, the stuff smells like a cross between shoe polish and alcoholic hand wipes. Very enjoyable. And the corn version can be enjoyed next day as it seeps from your pores.
On November 25th, 2009 at 3:09 pm ,Ish wrote:
Chris,
I can vouch for your report on the petroleum sector. I used to go to chemical factories and tanneries in a lot of the garden spots, and the *lunch* banquets were frequently drenched in baijiu. It made you wonder who was minding the factory in the afternoon…
On November 30th, 2009 at 11:05 pm ,Richard wrote:
Another “ganbei” moment: in the spring of 1982 when I was a 17 year old high school senior I went to China (which had only been open to the West for a year)on a school trip with parents and teachers. The trip was arranged by one of the student’s parents who was in the foreign service in China and arranged the trip. One of the events was a banquet at what was at the time the most highly regarded Peking duck restaurants in Peking. Anyway, I think that the custom was that each person had to toast a person at another table. There was much toasting (bottoms up!). There were three glasses on the table. One containted a watery wine like beverage, one a sickly sweet wine (plum?), and the third was Maotai. Maotai is the nastiest stuff I’ve ever had. Think Aquavite on steroids. But that’s not really fair to Aquavite. It weighs in at something like 140 proof. Anyway, not wanting to offend, we ended up having multiple shots of the stuff. By the end you never saw a drunker bunch of 17 year olds. Good fun though. And the duck was truly delicious.
On December 2nd, 2009 at 9:15 pm ,Dr. Vino wrote:
Hey Chris –
Thanks again for your first person insight. The WSJ has a story in tomorrow’s paper (link).
In it, among other interesting vignettes, they talk about bidders paying over retail for “show off” wines. We all read about it here first, thanks to your comment!