ChangYu shifted its promotion focus to less expensive wines and brandies, in reaction to declining consumption of premium wine during a period of slower economic growth.
The company also experienced heated domestic competition, including the market entrance of more foreign wine brands. Responding to these conditions, ChangYu also:
- Refined its distribution system to better match its products with the appropriate channels.
- Implemented new cost controls on advertising and other functions.
- Invested in capital improvement for its grape cultivation and harvesting.
ChangYu pioneered the modern era of Chinese winemaking 100 years ago, with the importation and cultivation of European vines. The company became publicly traded on the Shenzhen Stock Exchange in 1997.
Net income declined 14 percent to $103 million in the first half of 2014, on a 10 percent revenue drop to $352 million. For the full year 2013, net income declined 37 percent to $170 million on $664 million in revenue, a 21 percent decrease.