How long has it been since you last drank baijiu? According to data from the China Alcoholic Drinks Association, in 2022, the output of baijiu enterprises above designated size was 6.71 million kiloliters, a year-on-year decrease of 5.6%, hitting a ten-year low. The baijiu industry has entered a new cycle of declining volume, rising prices, and intensifying differentiation. Red wine and yellow wine are not much better, and beer faces intensified competition in a shrinking market. Only the low-alcohol drinks market remains relatively lively. Although it cannot compare with the sales surge and capital influx of 2021, in the past year, 620 new low-alcohol drink-related enterprises were registered, and about 13 low-alcohol drink brands received financing, making it quite noteworthy. At the same time, at the just-concluded 108th National Sugar and Wine Fair, not only was a dedicated low-alcohol trendy drinks exhibition area set up, with emerging brands like Shíqī Guāngnián, Baidiao MINIBOXX, and Sichuan Xunguo making appearances, but a two-day low-alcohol drinks forum was also held. So the question arises: why do low-alcohol drinks continue to maintain their popularity? Will this popularity last? What impact will it have on China's alcoholic beverage industry?
The Slight Buzz and High Aesthetics Traditional low-alcohol drinks are alcoholic beverages with an alcohol content below 20 degrees. The currently popular so-called low-alcohol drinks mainly refer to internet-famous mixed drinks, distinct from major categories like beer, red wine, and yellow wine. The popularity of low-alcohol drinks is closely linked to the growth of the young consumer group. Unlike their parents who enjoy toasting and drinking to excess, young people place greater importance on physical health and tend to prefer lower burden and better taste. Low-alcohol drinks are less likely to cause intoxication and do not leave the stomach uncomfortable like high-strength spirits do, perfectly meeting young people's desire to enhance their taste experience and sample alcohol lightly. In addition to being healthier, low-alcohol drinks often come in aesthetically pleasing packaging that is pleasing to the eye. For example, Luoyin uses transparent frosted glass bottles with metallic-colored caps and features images of ancient Chinese women, making it both fashionable and elegant; Bingqing depicts a couple linking pinky fingers in a promise on the bottle, fresh and beautiful, making it hard for young people not to be attracted. Because of the high aesthetics, young people who enjoy sharing their lives can also use it as a social backdrop while savoring it, giving low-alcohol drinks a social and communicative value that other alcoholic beverage categories lack.
If health and aesthetics are the underlying logic for low-alcohol drinks winning over young people, then relatively lower prices and richer consumption scenarios, including parties, camping, afternoon tea, bistro visits, script murder games, and music festivals, are important reasons for their broad market. Unlike traditional alcoholic beverages that rely more on television and outdoor advertising, low-alcohol drink brands, with young consumers as the main force, not only place greater emphasis on social media seeding and content sharing but also quickly ignite the market through cross-border IP collaborations, live-streaming sales, and product placements. At the start of their ventures, low-alcohol drink brands like Berry Sweetheart, Lanzhou, and Shidian Yike mostly adopted internet-famous brand strategies, achieving rapid sales growth in the short term. Malton also held multiple high-density offline music party events and planned to sign spokespersons for collaborations and offline concerts.
A Hundred Flowers Bloom or a Flash in the Pan The A-side of internet-famous products is popularity, and the B-side is transience. The traffic-driven approach has made many low-alcohol drink brands popular in a short time, but constrained by product homogeneity and channel expansion, many have fallen into the dual dilemma of online price wars and offline difficulties. According to incomplete statistics from Zebra Consumption, the official accounts, Weibo, Xiaohongshu, Douyin, and other social platforms of brands such as Malton, ZEYA, Fangqi Sparkling Spirits, Wanmuzhi, and Zouqi Qingniang have all stopped updating, and e-commerce channels like Taobao, JD.com, and WeChat mini-programs have basically ceased operations. This likely means these new brands have been marginalized. Through the waves of elimination, some fall while others rise. For example, Berry Sweetheart designs products around female consumer scenarios and has now laid out 40,000 offline retail terminals, covering more than 20 provinces nationwide; Bingqing targets dining scenarios such as hotpot restaurants, chuanchuan, and barbecue, continuously focusing on young users; Lanzhou starts with offline games like script murder, creating popular series such as the Lanzhou Night Banquet "Tipsy Script Murder" and "Drinking and Killing," capturing young people's offline social scenes. It can be seen that these low-alcohol drink brands have achieved phased success precisely because they entered niche tracks and relied on strong product strength to continuously cultivate offline markets.
Red Wine Bears the Brunt Although many low-alcohol drink brands currently focus on offline channels, their target groups differ from baijiu, so they will not shake the foundation of high-strength baijiu for now. On the contrary, many baijiu brands are entering the low-alcohol drinks field in a diversified manner. The five leading liquor companies—Moutai, Wuliangye, Yanghe, Fenjiu, and Luzhou Laojiao—have all launched low-alcohol drink products. After Moutai launched the low-alcohol cocktail "Youmi," it also introduced a blueberry wine under the same brand; Luzhou Laojiao even established a fruit wine company, with brands like Huajian Zhuo, Tingyue Xiaozhu, and Qingyu successively appearing, comprehensively laying out the low-alcohol segment. Gujing Gongjiu established Anhui Baiwei Lujiu Co., Ltd.; Shanghai Guijiu also launched Shíqī Guāngnián at the end of 2020, continuously developing the low-alcohol drinks market, and it has now become one of the mainstream brands in this new market. Against the market backdrop of declining baijiu volume and rising prices, the attitude toward new increments like low-alcohol drinks may exacerbate the differentiation and development pattern among baijiu enterprises. If the new forces of low-alcohol drinks rise and traditional alcoholic beverage capital intervenes, ultimately strengthening the momentum of low-alcohol drinks and completely carving out a new track in the existing pattern of baijiu, beer, red wine, and yellow wine, then the first to feel the pressure should be red wine. Low-alcohol drinks and red wine have similar consumer groups and drinking scenarios. In their competition, red wine has a beautiful story and does not need to worry about the repurchase rate anxiety of low-alcohol drinks, but it faces issues such as disconnection from Chinese culture, drinking barriers, and high pricing. In fact, in recent years, China's red wine consumption has indeed been continuously declining, dropping by 22.1% in 2022 alone. In contrast, low-alcohol drinks have the advantages of simpler and more casual consumption forms and lower prices. If they continue to break through in product strength and taste, they will further impact the red wine market.