---
title: "Internet Celebrities Are Not a Panacea: Low-Alcohol Beverage Brands Need to Strengthen Their Fundamentals"
description: "The low-alcohol beverage market is booming, attracting celebrities, giants, and capital, but internet-famous branding strategies face challenges in category value, supply chain, and channel management. Brands must focus on fundamentals to build competitive barriers."
author: "世家"
publisher: "New Distribution"
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published: "2021-08-01"
language: "en"
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# Internet Celebrities Are Not a Panacea: Low-Alcohol Beverage Brands Need to Strengthen Their Fundamentals

> The low-alcohol beverage market is booming, attracting celebrities, giants, and capital, but internet-famous branding strategies face challenges in category value, supply chain, and channel management. Brands must focus on fundamentals to build competitive barriers.

**Click to read the original article for details**
Celebrity entrepreneurship, cross-industry moves by giants, and investment clusters—the currently hot low-alcohol beverage market has been at the forefront of capital trends for the past two years.
With leading baijiu brands like Wuliangye and Luzhou Laojiao following the trend, giants like Coca-Cola and Nongfu Spring entering the market, and new brands continuously emerging and securing financing, capital firms such as Sequoia, Matrix Partners, ZhenFund, and Tiantu have all joined. The low-alcohol beverage track, gathering both new and old players, is experiencing another explosion.
Low-alcohol beverages mainly include four categories: fruit-flavored wine, soda wine, rice wine, and premixed drinks. Due to their relatively low alcohol content, smooth taste, and more diverse flavors, they are favored by young consumers, especially young women. Fruit-flavored wine and soda wine are the focus of investment by many leading capital firms after surveying the market.
Interestingly, **the current hot low-alcohol beverage market is replicating the path of areas favored by capital, such as milk tea and e-cigarettes.**
Many low-alcohol beverage brands adopt a "light-asset" internet-famous brand building logic, creating marketing concepts around diversified flavors and health. Entrepreneurs, capital, and internet traffic platforms jointly package brands as "internet celebrities." With similar selling points and the same marketing formula, internet-famous brands are mass-produced in the low-alcohol beverage track.
It is undeniable that internet-famous tactics targeting young people have succeeded in recent years for some new consumer brands, such as Genki Forest, Zhong Xue Gao, and Xiaoxian Dun. These tactics offer advantages like quick results and rapid market ascension, and are adopted by many new brands.
**However, whether the shortcut of internet-famous tactics is suitable for the low-alcohol beverage track and what challenges it faces require rational research.**
**Creating Concepts and Selling Points:**
**Internet-Famous Tactics Face Challenges of Category Value**
China's alcohol industry is relatively traditional. Despite some digital and new media attempts, it remains "conservative" and is an area that the internet has not yet fully penetrated. Compared with other consumer goods, the alcohol industry has its own particularities; its category value stems from years of accumulated craftsmanship and quality.
Baijiu, beer, and wine dominate China's alcohol industry, each with highly recognized value evaluation standards, such as baijiu by age, beer by malt content, and wine by region. Combined with the inheritance of brewing techniques, they all have mature value support systems.
In contrast, **low-alcohol beverages have long been a niche market, small in scale and fragmented, often developed in the form of small workshops, lacking category value accumulation. The internet-famous approach of creating new concepts and selling points, in the just-emerging low-alcohol beverage track, suffers from insufficient value recognition.**
Some say to find a segmented market and redefine it, like Genki Forest creating the zero-sugar sparkling water concept and becoming a leading brand in a new category.
But it should be noted that **Genki Forest entered the soda water category, where market education is relatively mature, the value perception is relatively strong, and product prices are higher. The public already has a certain foundation for recognizing the value of soda water.** Therefore, Genki Forest quickly became popular with the "0 sugar, 0 fat, 0 calories" selling point combined with a lower price.
However, the current low-alcohol beverage market is immature, with poor category value standards and market education. Brands find it difficult to achieve precise positioning in segmented markets or thoroughly develop a category. New selling points lacking real value support can easily become pseudo-concepts.
At the same time, because the low-alcohol beverage track is in a blue ocean stage, **many entrants, including many cross-industry entrepreneurs, lack deep understanding of the low-alcohol beverage industry and consumer needs.** Blindly following trends leads to serious homogenization, which accelerates the decline in general awareness of category value.
When "0 sugar, 0 fat" and "real fruit brewing" become industry standards, and there are no other selling points, a price war is inevitable.
**Facing the challenge of category value, low-alcohol beverage brands need to calm down and formulate brand strategies from the perspective of the low-alcohol beverage category.**
Redefine the quality standards of the low-alcohol beverage industry, shape the core value of the category based on deep quality and craftsmanship, and promote and lead a value revolution in the category. For example, Japan's sake brand Dassai, through the polishing ratio standard of 23%, became a leader in the sake category with a higher value standard.
For a blue ocean track with no leading brands, whoever occupies the high ground of value first will be in a leading competitive position and become the new leader of the low-alcohol beverage category.
**Marketing First, Factory Later:**
**Internet-Famous Tactics Face Supply Chain Challenges**
Internet-famous brands generally adopt a light-asset approach, using OEM and ODM models, rarely building their own supply chains. Even leading internet-famous brands like Relx, Genki Forest, and Perfect Diary initially used contract manufacturing and only later built their own factories.
This approach is replicated by many low-alcohol beverage brands: they design the brand, find a contract distillery, propose their needs or simply choose from the distillery's existing product types, then hand over the "heavy lifting" of production and R&D to the contract manufacturer, focusing solely on marketing.
This path seems effortless and efficient, but it hides many aftereffects.
Unlike FMCG, in the alcoholic beverage field, the supply chain is the lifeline of a brand and the key to building competitive barriers and moats. Without a proprietary supply chain or control over it, a brand may be overdrawing its future.
Lacking supply chain influence means losing control over product quality. Low-alcohol beverages, like other alcohol categories, have high requirements for production processes.
Especially since low-alcohol beverages innovate in raw materials, such as brewing with fresh fruit, raw materials are prone to sedimentation. Any mistake in production, filling, or packaging can cause the wine to spoil.
The OEM model cannot ensure quality control during production, ultimately damaging brand reputation due to taste issues. Consumers prioritize taste when choosing alcoholic beverages; a bad first taste makes repeat purchases unlikely.
Lack of supply chain control easily leads to discrepancies between front-end product R&D and design and back-end production and brewing. Product R&D and design target consumer preferences, but implementing these needs in back-end production is often difficult for the contract manufacturer's team and equipment.
Contract manufacturers often cannot meet the brand's differentiation requirements, so brands can only choose from existing product types, resulting in a mismatch between R&D design and final products. Additionally, contract manufacturers take orders from other brands, so product formulas are not confidential, inevitably leading to severe homogenization and weak competitive advantage, further intensifying marketing battles.
Facing the challenge of supply chain influence, **low-alcohol beverage brands need to leverage their innovative ideas, absorb the advantages of the internet-famous model, and establish deep supply chain cooperation models based on digital information systems**, such as drawing on the SPA model to create a supply chain model suitable for the low-alcohol beverage field.
Mastering supply chain influence, strictly controlling product R&D and quality, maintaining stable product quality that matches R&D design, and quickly establishing competitive barriers will sustain a competitive advantage in the market.
**Internet-Famous Tactics Face Challenges of Omnichannel Management**
Internet-famous brands emphasize online channels, using high-cost marketing investments on traffic platforms, adopting a single-product explosive strategy to maximize exposure in a short time. They use platform seeding, live-streaming e-commerce, and celebrity endorsements to continuously acquire traffic from online platforms. In contrast, offline channels are fragmented, have high entry barriers, require long-term continuous operation, and involve significant investment.
Internet-famous brands tend to favor online channels that yield quick results, avoiding the need to settle down and accumulate in offline channels.
In other consumer product tracks, online channels are important sales windows, and this approach may succeed. But the alcohol industry is special. According to public data, online channels account for only 5% of total alcohol industry sales, **and offline channels dominate alcohol sales.**
Currently, alcohol sales mainly come from immediate consumption scenarios, determined by **China's drinking culture**. Chinese people's habit of "eating and drinking well" is closely related to dining scenarios, and offline channels are where consumers primarily consume.
Especially for low-alcohol beverages, market awareness is weak. Many consumers do not have fixed brand consumption habits. When gathering, they often buy at restaurants, convenience stores, and other channels. Their awareness of low-alcohol beverage brands mainly comes from what they see in offline scenarios.
Offline channels are an unavoidable hurdle for low-alcohol beverage brands. Avoiding offline channels due to difficulty actually shortens the brand lifecycle. Even if a brand becomes popular quickly, it will struggle to sustain momentum and truly open up market sales.
Traditional baijiu and beer brands commonly adopt deep distribution or distribution collaboration models, with strong control over offline channels, resource integration capabilities, and channel cultivation advantages, which are also their competitive barriers. Traditional alcohol brands leverage the strength of distributors and agents, collaboratively laying out offline channels, with less direct consumer contact.
As an emerging track, low-alcohol beverage brands have no leading brands and low entry barriers. Many entrants are non-alcohol industry entrepreneurs who lack understanding of alcohol industry common sense and channels. Many copy the internet-famous DTC model from other industries, directly facing consumers and focusing on online channels.
**But the low-alcohol beverage market itself is small, and the incremental market of young people is insufficient. It needs to seize the existing beer market. The pure DTC model is difficult to truly succeed in the low-alcohol beverage track.**
Low-alcohol beverages are an emerging track, and the market is still in the early cultivation stage. **The category lacks high-end value support, and mid-to-high-end products lack the soil for growth**, resulting in generally low gross margins.
Internet-famous tactics such as large-scale seeding on traffic platforms and live-streaming with top influencers require high marketing expenses. Without high-profit, high-premium products, it is difficult to sustain excessive marketing costs.
Moreover, online platforms suffer from information overload. Maintaining brand buzz requires continuous marketing investment, but whether it can truly build brand competitiveness and establish consumer mindshare is uncertain. It also cannot solve offline channel issues, so market sales are not guaranteed.
Facing the channel challenges, low-alcohol beverage brands need to manage channels meticulously, building sales and communication pathways through a "online + offline" three-dimensional approach. Use online channels as the main image window, avoid blind full-coverage high investment, focus on core consumer groups, and engage in precise communication and marketing.
Through high-stickiness, brand-and-performance integrated marketing actions, build image and reputation, and establish brand awareness and value recognition among core consumers.
Use offline channels as the main sales pathway, create regional model markets, and focus on immediate consumption channels to thoroughly develop consumption scenarios. Around convenience stores, B-class restaurants, new retail chains, and other main suitable channels, implement precise and refined channel management to ensure scale sales.
In the hot low-alcohol beverage track, brands need to "calm down and go deep," **not rush to follow internet-famous brand tactics, but deeply understand the industry's "unspoken rules" and target consumer needs, and solidly do the four key tasks of "brand, supply chain, channel, and marketing" to build competitive barriers and moats.**
The low-alcohol beverage track has low entry barriers and no leading brands, a blue ocean. With capital catalysis, brands are all on the same starting line. Only those that do their "fundamentals" well will laugh last.
_Note: Regarding how low-alcohol beverage companies can dig deep into "brand, supply chain, channel, and marketing," at the New Alcohol Beverage Forum of the 2021 (4th) China FMCG Conference held by New Distribution from August 24 to 26, we invited Ms. Tang Huimin, founder of Berry Sweet, and Ms. Jiang Xiaoyun, founder of Mike Rice Wine, to explain their understanding of the low-alcohol beverage market and their market layout strategies._
**PS**: From August 24 to 26, 2021, the 2021 (4th) China FMCG Conference hosted by New Distribution will be held in Shanghai. **Focusing on industry trends, practical cases, and growth connections**, **3,000** FMCG practitioners will gather.
10 themed forums cover **new retail O2O, community group buying, short-video live e-commerce, distributor transformation, new consumer brand rise, new alcohol beverage interpretation, distribution B2B supply chain, omnichannel marketing, B2B2C new technology applications**, etc., with operators in each segment bringing the latest case studies.
Some of the confirmed heavyweight guests include: **1. Tao Shiqian, founder of Jiangxiaobai; 2. Yao Xuhong, general manager of Meiyijia Holdings Co., Ltd.; 3. Lu Xiuqiong, global expert partner at Bain & Company and former vice president of marketing at Coca-Cola China; 4. Chen Xiaodong, senior vice president of Nestlé Greater China; 5. Zhang Fujun, president of Lee Kum Kee Sauce Group China; 6. Bi Chaojiao, general manager of China Resources Snow Breweries (China) Marketing Center; 7. Yang Hongbin, vice president of Junlebao Dairy Group; 8. Yang Shun, COO of Lipton Greater China; 9. Zhang Yipeng, general manager of Kuaishou E-commerce SKA Brand Operations Center; 10. Li De, e-commerce general manager of Gold Hong Ye Paper Group...**
**A grand event for FMCG practitioners—you must be there!**
**Are you "watching" me?**


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