Home News Exhibition & Activity Magazine Media Partner Partner

The spirits market in China: The four most popular alcoholic drinks among Chinese consumers(II)
Post Time:2019-07-17Author:F2C

How Chinese drink western spirits: cocktails or shots

Spirits in China may be consumed differently than in the west. For Chinese Baijiu, it is almost always drunk straight. This method was not suitable to other western spirits for most Chinese consumers at the beginning because they were not accustomed to the flavors of western spirits, and therefore bars and night clubs mainly produced cocktails rather than serving shots. But currently, Chinese consumers are trying to take western spirits in the same way as Chinese Baijiu. Single malt Whisky, for example, is becoming a new favorite in bars as Scotch Whiskey become famous in the spirits market in China.

The four most popular alcoholic beverages in China

Based on the graphs showed above and current market situation, the four alcoholic beverages most popular spirits in China, namely Chinese Baijiu, Whiskey, Brandy, and Vodka.

Competition analysis of Baijiu in China: Moutai still take the first

Chinese Baijiu is the best-selling spirit in the Chinese spirits market. At present, there are dozens of Baijiu brands in Baijiu market in China, and the most popular one is Moutai from Guizhou Province.

Baijiu market in China                                                                                                       [Source: Forward-The Economist “10 pictures show you the development and current situation of Baijiu industry, Moutai has the biggest market share”]

According to the pie graph of 2017, Moutai accounts for above 60% of the Baijiu market in China, followed by Wuliangye, which accounts for 26%, the remaining brands’ market shares don’t exceed 10% individually.

Baijiu consumption in China                                                                                                          [Source: Sohu “2018 Baijiu market development”]

The bar graph above shows the preference of Chinese Baijiu consumers. It seems that the brand and the price are the main aspects when Chinese consumers consider most when they buy Baijiu. This can also explain why Moutai has the biggest market share in Chinese spirits: as Baijiu is already the most popular spirit in the Chinese spirits market, Moutai is also in the leading position of Baijiu market in China as it has both high price and low price products, which allow Moutai to keep its brand awareness and give diverse price choices to consumers.

Competition analysis of Whiskey in China: Single malt whiskey booms

Whisky consumption in China                                                                                                                                                         [Source: Youku “More Whisky in Chivas”]

Chinese liquor consumers are younger compared to other countries, according to the news report on ifeng. Whiskey brands like Chivas have already noticed this trend and adopted the corresponding tactic to attract young consumers group. Chivas, one of the famous Whisky Brand, invited Kris Wu, who is a pop star in China and is popular among Chinese more youthful generation, to shoot the advertisement for its Whisky. The advertisement aimed to attract Kris Wu’s fans, who mostly are young people as well as the potential consumers of the whiskey market in China. To attract more young consumers, Chivas also cooperated with the NBA and successfully increased its spirits sales in China as basketball is popular in China.

Spirits market in China                                                                                                                                  [Source: taosj “Whisky sales on Taobao/Tmall”]

UK (Scotland) and the USA are the original countries of popular brands on Taobao/Tmall.  Due to a good reputation, flavor, high-end images, and fashionable package design, their spirits sales in China are quite high.

There are a few Asian brands (such as Japanese) selling on Taobao/Tmall, but their sales are much lower than Western brands.

With the popularity of Whisky, Scotch Whisky exposes more to Chinese spirits consumers, which creates a new submarket of the Whiskey market in China: single malt Whisky. According to the data released in 2018 by SWA (Scotch Whiskey Association), “a record number of 2,026,779 bottles of single malt 70cl Scotch were exported to China in 2017, a surge of 190 percent compared to five years ago, and equivalent in value to 20.1 million pounds ($25.3 million).” China Daily reported. It shows that the exporting alcohol to China of SWA will increase, and single malt Whiskey is expected to grow in sales and stimulate the growth of the Whiskey market in China. First-tier cities like Beijing, Shanghai, Guangzhou, and Shenzhen have bars specialize in providing single malt whiskey to Chinese consumers.

Competition analysis of Vodka in China: Vodka and fashion

Chinese spirits market                                                                                                                                   [Source: taosj “Vodka sales on Taobao/Tmall”]

The Vodka market in China is led by Absolut Vodka produced in Sweden, followed by Skyy produced in the USA. The reason that Absolut Vodka has led the Vodka market in China for many years is it cooperated tightly with different sectors. In the past years, Absolut Vodka considered what was popular and utilized the favorite element to decorate its products and create an appealing advertisement. By the upscale images, pleasant taste and creative advertising, Absolut Vodka has been the most popular vodka brand and attracted many high-income consumers in the Vodka market in China, although its price is relatively high.

Competition analysis of Brandy in China: Chinese Brandy producer Zhangyu

Spirits market in China                                                                                                                                [Source: Brandy sales on Taobao/Tmall]

The table above shows the Brandy market in China is occupied by French Brandy brands, which enjoy a long history of Brandy production and decent reputation. Their high-end images, good quality, and appealing package designs attracted a large number of Chinese consumers.

Brandy brands in the Chinese spirits market utilize digital activities to advertise themselves and boost Brandy spirits sales in China. Martell, a famous Brandy brand, makes its advertisement by cooperating with e-commerce platforms and social media to build up its high-end image, such as participate in Tmall’s “Super Brand Day” and shoot videos for ads.

One thing noticeable is that Chinese Brandy brand Zhangyu also emerges and accounts for the most market share in the Brandy market in China. It seems that Chinese domestic alcoholic beverage manufacturers are also entering the Brandy market in China to compete with foreign brands. However, as Zhangyu shows, Chinese Brandy products are at a low price to win the market share compared to French counterparts.

The current trend on the Chinese spirits Market

For China’s alcoholic beverage market, the spirits market is promising, and three trends are predicted to be shown as follows:

The majority are young consumers

More and more international brands are targeting young consumers (post-90s) by building fashionable images since they have enormous consuming potential and willing to pay for fashionable lifestyles. At present, as more and more night clubs, bars, pubs are prevailing around 1~ and 2-tier cities in China, and they are the central bodies who receive exporting alcohol to China, younger generation group have more chances to get access to western spirits, knowing more about western spirits culture as well as stimulating the growth of the spirits market in China. With growing China’s alcoholic beverage market, and higher income level, the scale of the market may influence more young consumers to enter the Chinese spirits market.

source: DAXUE  cousulting

Read More

Post Trade Lead

Follow Us

Subscription

Back to top