Source | Gooods 好味司 ID | Gooods_haoweisi Author | 海枫

We observed that in the first half of this year, a large number of low-alcohol baijiu products were launched, and low-alcohol baijiu may become the mainstream product strategy in the baijiu industry. Over the past decade, the Chinese baijiu industry has achieved structural upgrades focused on mid-to-high-end and high-end products, with the high-end product portfolios of many well-known liquor companies becoming the core source of revenue. However, in recent years, as the economy has entered structural adjustment and consumption momentum has slowed, the baijiu industry has entered a new round of adjustment. Price inversions for mid-to-high-end and high-end baijiu have become common, and the industry's hard currency, "Feitian Moutai," has seen its bulk price drop from 3,000 yuan to below 2,000 yuan. Coupled with the "alcohol ban" in the first half of 2025, the industry has entered a deep adjustment period. Almost all baijiu companies are facing declines in revenue and profit growth. In the first half of this year, even Kweichow Moutai ended its decade-long double-digit revenue growth in its semi-annual report. These signals indicate the end of the old era for China's baijiu industry and the beginning of a new one. As traditional baijiu consumer groups and scenarios shrink or even disappear, major liquor companies are turning their attention to "youthfulness" and "low-alcohol" strategies to restart growth. In the annual reports of baijiu companies, keywords such as "youthfulness" and "young consumers" frequently appear, and some companies have begun to launch low-alcohol baijiu products. Since the beginning of this year, low-alcohol baijiu products have been increasing. Wuliangye, Gujing Gongjiu, and Shede Spirits have all launched low-alcohol baijiu products, while Yanghe, Luzhou Laojiao, Shuijingfang, Fenjiu, and Jiugui Liquor have also prepared product reserves, with products about to hit the market. Industry associations have also noticed this trend. In August this year, the China Alcoholic Drinks Association released the group standard "Low-Alcohol Multi-Grain Strong Aroma Baijiu," which, although only targeting strong aroma baijiu, indicates that low-alcohol baijiu has received attention from important industry associations. What is the alcohol content of low-alcohol baijiu? There are 12 aroma types in the national standard for baijiu. In the current new or upcoming standards, only strong aroma baijiu classifies alcohol content: high-alcohol baijiu is above 40% to 68% (excluding 40%), and low-alcohol baijiu is 25% to 40% (including 25% and 40%). In the old or original national standards, there were also classifications for sauce aroma, light aroma, rice aroma, and special aroma baijiu, but these have been deleted in the new or upcoming standards. Despite the deletion, they can still serve as important references for high-alcohol and low-alcohol baijiu. The group standard "Low-Alcohol Multi-Grain Strong Aroma Baijiu" released by the China Alcoholic Drinks Association defines 18 to 40 degrees as low-alcohol strong aroma baijiu. Currently, the industry generally agrees that most define 40 degrees or below (including 40 degrees) as low-alcohol baijiu, and above 40 degrees as high-alcohol baijiu. Judging from the multiple low-alcohol baijiu products released in the first half of this year, the alcohol content is generally within 40 degrees. Two representative low-alcohol baijiu products 38-degree Guojiao 1573 vs. Jiangxiaobai Before low-alcohol baijiu became a market consensus, some baijiu companies had already achieved good results. Among them, 38-degree Guojiao 1573 and Jiangxiaobai are two representatives, but they have chosen two completely different routes. Guojiao 1573 is a high-end brand under Luzhou Laojiao in Sichuan and one of the three high-end baijiu brands in China with sales exceeding 10 billion yuan. The classic version of Guojiao 1573 is 52 degrees, with a market price of around 900-1,000 yuan. The 38-degree Guojiao 1573 is positioned as mid-to-high-end and was launched in 2001 with a market price of around 700 yuan. Its product positioning closely follows the classic version of Guojiao 1573, and the price has not been significantly reduced due to the lower alcohol content, maintaining a certain price difference to increase consumer appeal. Its market and customer positioning also targets traditional mid-to-high-end baijiu consumers and scenarios, focusing on business and banquet occasions such as corporate entertainment. Since 2015, 38-degree Guojiao 1573 has been deeply cultivating specific markets and regions, with North China markets such as Hebei and Shandong as the core. These markets prefer low-alcohol baijiu below 40 degrees, which happens to be one of Luzhou Laojiao's key markets. According to reports from Yunjiu Toutiao, from 2015 to 2024, the proportion of low-alcohol products in Guojiao 1573's revenue increased from about 15% to 50%. At the 2024 shareholders' meeting, Luzhou Laojiao revealed that the Guojiao 1573 series achieved annual sales exceeding 20 billion yuan, which means that 38-degree Guojiao 1573 has become a super single product at the 10-billion-yuan level. The success of 38-degree Guojiao 1573 means that even in the mid-to-high-end and high-end baijiu market, low-alcoholization still has huge market potential. Another representative brand of low-alcohol baijiu is Jiangxiaobai, founded in 2012, positioned as a mass-market bare bottle liquor, targeting young consumers, and is the pioneer and leader in the youth-oriented transformation of Chinese baijiu. Jiangxiaobai is a light aroma baijiu with a core product of 40 degrees, positioned as a small liquor for young people. The liquor body has also been adjusted for young consumers, making it more palatable and pure, and suitable for making mixed drinks. In its early days, Jiangxiaobai relied on youth-oriented internet marketing to gain popularity and combined it with its products. For example, Jiangxiaobai's expression bottle printed a sentence on the bottle sleeve that could resonate with young people, making the brand popular. After more than ten years of accumulation and development, Jiangxiaobai has leveraged its foundation in low-alcohol baijiu to expand its product line to more low-alcohol liquor categories, strengthening its product portfolio among young consumers. The more successful ones are Guolifang and Meijian, which have supported Jiangxiaobai's growth in the past few years and have also added many advantages for Jiangxiaobai in the upcoming trends of low-alcohol and youth-oriented liquor consumption. How is this low-alcoholization different from the past? First, this low-alcohol baijiu trend is almost a consensus across the entire industry, and most baijiu companies have already laid out plans. In the past, low-alcohol baijiu was more of a supplementary product in the Chinese baijiu market, explored by a few companies without forming a consensus. The level of participation is not just brand and marketing-oriented but involves actually launching low-alcohol baijiu products. Leading well-known liquor companies like Wuliangye have also launched new product lines for low-alcohol baijiu: Wuliangye · Yijian Qingxin. Second, the alcohol content has further dropped to below 30 degrees. Among them, the low-alcohol baijiu products launched by Wuliangye, Gujing Gongjiu, and Shede Spirits are all in the 20s degrees, and Luzhou Laojiao has also successfully developed a 28-degree Guojiao 1573, which will be officially launched at an appropriate time. Third, today's low-alcohol baijiu is no longer a supplement to the Chinese baijiu market but an important component, and may be a very core driver in the future. According to data from the China Alcoholic Drinks Association, the low-alcohol baijiu market in China is expected to exceed 74 billion yuan in 2025, with a compound annual growth rate of 25%. In comparison, in the "2025 China Baijiu Market Mid-Year Research Report" jointly released by the China Alcoholic Drinks Association and KPMG, in 2024, baijiu companies above designated size completed sales revenue of 796.38 billion yuan, which means low-alcohol baijiu accounts for nearly 10% of the overall baijiu market. China's baijiu industry has entered a deep adjustment period, interrupting the mid-to-high-end and high-end development process. At the same time, mid-to-low-end baijiu is being cleared out. Baijiu production has continuously declined from 13.584 million kiloliters in 2016 to only 4.145 million kiloliters in 2024, less than one-third. The downward trend continues in 2025, with cumulative production from January to April 2025 only 1.308 million kiloliters, a year-on-year decrease of 7.8%. What product directions are there for low-alcohol baijiu? We can understand the current product types of low-alcohol baijiu from three perspectives: alcohol content, product strategy, and narrative style. First, from the perspective of alcohol content and consumer groups. We simply divide low-alcohol baijiu into two categories: 30-40 degrees and 20-30 degrees. The former is easier to make into mid-to-high-end products, while the latter is more suitable for youth-oriented and mass-market products. (*Baijiu below 20 degrees is extremely rare on the market) Low-alcohol baijiu of 30-40 degrees has a taste closer to traditional high-alcohol baijiu products but with lower alcohol content. Therefore, it is easier to replace products in traditional business, banquet, and reception scenarios, and the corresponding users and groups have certain purchasing power, making it easier to create mid-to-high-end products. Low-alcohol baijiu of 20-30 degrees, because it is difficult to meet the needs of traditional baijiu consumers in terms of body and flavor, is instead suitable for young consumers who prefer softer tastes. Second, from the perspective of product market entry strategy. There are several types:

  • Existing mid-to-high-end and high-end products on the market, adding low-alcohol product lines. Representative products include 38-degree Guojiao 1573, 26-degree Nianfen Yuanjiang Mild Gu 20, and 39-degree Wuliangye Puwu.
  • Positioning as mid-to-high-end, establishing new product lines, such as Wuliangye's "Yijian Qingxin," Shede Zizai, and Yanghe Weifenzi.
  • Positioning as mass-market new product lines/brands, such as Jiangxiaobai and Jiujiang Shuangzheng.
  • Another type we predict is that as the wave of low-alcohol baijiu expands further, it will drive bare bottle liquor brands on the market to launch low-alcohol baijiu based on existing product lines, such as Hongxing Erguotou, Niulanshan, and Bofen. Finally, from the perspective of product line narrative style. Depending on whether the low-alcohol baijiu product line is specifically created for young consumers, it can be divided into traditional narrative and new narrative. There are many discussions about whether young consumers drink baijiu. Reasons for not liking it include but are not limited to: high alcohol content, spicy taste, easy to get drunk, slow hangover recovery, single or insufficient flavor (compared to cocktails and fruit wines), and drinking culture. Therefore, creating a new narrative in the baijiu field is essentially about understanding young people, telling new stories that they recognize, and making innovations. For example, Jiangxiaobai's past was a new narrative and was relatively successful. The brand "Yijian Qingxin" launched by Wuliangye also belongs to a new narrative, signing G.E.M. as spokesperson and using a new packaging design style. Traditional narrative continues the traditional approach, focusing on traditional baijiu consumer groups, scenarios, and needs, without making major changes to product design and packaging. Measures targeting young consumers are more at the marketing level, using activities and scenarios to extend the core consumer base to young people. For example, Guojiao 1573's core users are not young people who drink alone, but the product also wants to attract young consumers. Therefore, it launched the "Ice JOYS Inspiration Fermentation Bureau" activity, using pop-up stores and mixed drinks to attract young people's participation. Can low-alcoholization and youthfulness reconstruct the baijiu industry? In the past decade or more, China's baijiu industry has completed structural adjustment towards mid-to-high-end and high-end. In the next decade, under the influence of low-alcoholization and youthfulness trends, will the baijiu industry be reconstructed? This depends on whether young consumers are willing to pay for baijiu. In the past, high-alcohol baijiu was difficult to attract young people's favor (except for a few mid-to-high-end and high-end baijiu), so more hope is placed on low-alcohol baijiu. The key also lies in whether low-alcohol baijiu can tell a new story for young consumers. From this perspective, to reconstruct China's baijiu industry, more liquor companies like Pingzi Xingqiu (the parent company of Jiangxiaobai) are needed to combine youthfulness and low-alcoholization and tell a new story well. Of course, Jiangxiaobai chose the mass-market route, which is just one option. The new story of youthfulness and low-alcoholization can also be done in the mid-to-high-end and high-end segments. In the past few years, the youthfulness and low-alcoholization of liquor consumption have occurred more in fields outside baijiu, such as cocktails, fruit wines, and green plum wine. In comparison, these tasty wines are easier to win recognition from young consumers. Baijiu carries a heavier burden, making it relatively harder to tell new stories and tell them well. The combination of youthfulness and low-alcoholization in baijiu is still in its early stages, and there is a long way to go to reconstruct China's baijiu industry. But regardless, the youthfulness and low-alcoholization of baijiu are obvious trends and a high consensus in the market and industry. Seizing both youthfulness and low-alcoholization can also seize opportunities and gain more initiative during the deep adjustment phase of the baijiu industry. As for combining youthfulness and low-alcoholization to tell a new baijiu story, it can be considered a long-term strategy, which may have a better chance of achieving good results.