-01- How popular is Moutai? No need for an introduction. From the stock market to the market at large, the legend of baijiu (white liquor) is everywhere across China. Moutai's popularity has led to a boom in sauce-flavored liquor. The 2021 Spring Sugar and Wine Fair basically became a sauce-flavored liquor fair. Everywhere you look, there are exhibition halls for sauce-flavored liquors with names you've heard and names you haven't, flavors bizarre and varied, and packaging flashy and extravagant. It's expected that after the fair, manufacturers from all over the country will have scraped the land of Moutai Town down by three feet. Many business owners around me are eager to jump in: some, seeing the sauce-flavor craze, plan to dive in and grab a piece; others, who had already positioned themselves in sauce-flavored liquor, now feel uneasy as the market heats up wildly—should they expand or cash out and leave? For the first type, I advise them not to reach out. The liquor industry is deep water. If you're a novice trying to ride the wave, chances are you'll be the 'pig that falls and dies after the wind passes.' For the second type, of course, first congratulations. As for whether to expand or contract, it's hard to say; at least for now, there's no problem. Just like predicting housing prices and the stock market, saying the stock market will rise or fall sooner or later is correct, and saying housing prices will rise or fall sooner or later is also absolutely correct. Correct, but nonsense. When talking about trends, you must talk about timing; not mentioning timing is being a rogue. How long the sauce-flavor craze lasts depends on how long Moutai can sit on the 'throne of baijiu,' and how long the Moutai boss's reign lasts depends on whether the next generation of drinkers will continue to worship Moutai and accept its rules of the game. -02- Here's an important concept: 'consumerist discourse hegemony.' A while ago, Zhang Yiming criticized the internet 'jargon' that flooded the screen. He felt that internet giants no longer speak 'human language.' Terms like 'empower customers,' 'service chain,' 'business closed loop,' 'granularity,' 'grip points,' etc., a bunch of high-sounding but confusing words, are mass-produced every year. Language corruption is the greatest corruption, and many people detest it. But rest assured, this disease can't be cured at the root. It's a kind of workplace discourse power. Internet giants have it, traditional enterprises have it, and even the government has it, just in different forms: 'grasp the spirit,' 'implement efficiently,' 'steady transformation,' 'optimize layout,' 'put consumer needs (people's interests) first,' etc., even more than internet giants. Chairman Mao opposed 'Party stereotyped writing,' and the central government has repeatedly ordered short meetings and no empty talk or clichés. The effect is there, but it can't be eradicated. It's human nature. Once an organization becomes large enough, the correlation between individual ability and getting things done diminishes, and the organization's resource investment becomes the key factor for success. So, those who can do are not as good as those who can talk, and mastering a set of jargon becomes especially important. Mastering this jargon is much easier than mastering professional skills. In one year, you achieve small success; in three years, you become a veteran. This is the workplace discourse system. Once this system becomes particularly strong, those who don't master it become 'outsiders,' considered not understanding the 'business.' This system becomes 'workplace discourse hegemony.' Where there are people, there are rivers and lakes; where there are rivers and lakes, there is a discourse system. And consumer goods wanting to build a brand cannot escape the creation of such a discourse system. Consumer goods can be divided into two categories: weakly social and strongly social. Consumption is never a personal matter; there is no consumer good without any sociality. The most typical weakly social products, like fresh produce, rice, flour, oil, and medicine, also have some sociality. Those who eat organic vegetables feel superior to those who eat ordinary vegetables; those who use olive oil feel more sophisticated than those who use peanut oil; even if they have heart disease and get an imported stent, they can hold their heads higher. But overall, for weakly social consumer goods, the brand route is usually mass-market, emphasizing tangible consumer benefits, functionality, cost-effectiveness, product guarantees, and advantages. For strongly social products, a powerful discourse system is essential, and this system is almost a metaphysics. Listen to these words from the baijiu industry: rich and mellow, fragrant but not flashy, all fragrances rich, elegant and delicate, long aftertaste, sweet and refreshing... Doesn't it feel like internet jargon? It's said that good strong-aroma liquor should be sweet and refreshing with a clean finish, while light-aroma liquor is mellow, sweet, soft, and refreshing. Can you tell the difference? Isn't this another way of not speaking 'human language'? It's said that one major characteristic of sauce-aroma liquor is 'full and mellow,' while the characteristic of fuyu-aroma is 'mellow and rich.' Isn't it particularly moving to see the profoundness of great Chinese? If you think only we Chinese play this game, you're too out. Foreigners play it just as well. A precious vintage champagne always 'pops, and the air is filled with complex aromas mixed with yeast autolysis.' When tasting red wine, the words to describe the body alone include: round, soft, delicate, light, heavy, balanced, mature, young, pleasant, hollow, thin, etc. Hearing these words, don't you think 'empower' and 'closed loop' are more down-to-earth? Of course, an important part of the discourse system is the 'brand story.' Nowadays, all enterprises value the ability to tell stories, but the level varies. Some are clever, some are awkward, and it's better not to tell at all. In marketing textbooks, the most typical case is 'diamonds.' With a powerful discourse system, a hard stone was sold as a luxury item, the biggest 'story' in marketing history. Of course, you could also consider it an 'accident.' But in the Chinese market, De Beers is a little brother compared to Moutai. -03- As we mentioned earlier, products with strong social attributes cannot honestly do mass communication; otherwise, they 'fall into a pit.' And baijiu is precisely the product with the strongest social attributes of all, without exception. The first to fall into the 'pit' was Fenjiu. 'Fen Boss,' as the oldest baijiu in Chinese history, responded to the national call in the 1980s to make 'baijiu that ordinary Chinese people can afford.' This 'positioning' became the root of Fen Boss's inability to turn around for so many years. Political correctness is not commercial correctness. As a strongly social product, if you want everyone to afford it, it means that once people have a bit of money, they will all abandon you. All Chinese baijiu enterprises should thank one brand: Shuijingfang. Around 2000, Shuijingfang burst onto the scene, claiming to be the first brand of high-end baijiu, with a retail price of over 500 yuan, and it sold out. At that time, Moutai and Wuliangye were both over 100 yuan. Shuijingfang's success opened the eyes of Moutai and Wuliangye, giving them the confidence to raise prices. The Chinese baijiu world began to flourish. The baijiu bosses not only mastered the essence of strongly social products but also found a way to play that suits the Chinese market even better. So, they each showed their magic, beating foreign liquor, red wine, and yellow wine to the ground. The baijiu industry entered a 'golden twenty years.' In the first decade, volume and price soared, with annual growth rates reaching an astonishing 30%. In the last decade, sales volume stabilized, but prices rose further, and the market concentrated on leading brands. Some regional specialty distilleries also thrived. Among them, the most masterful was Moutai. Ji Keliang, then chairman of Moutai Group, was a 'marketing' master deeply versed in human nature and Chinese rules. In terms of grasping human nature, Lao Miao thinks only Shi Yuzhu and Du Guoying can compete. -04- To see through the dazzling tactics, we first need to understand a few common sense points. First, some common sense about baijiu. Alcohol is a Class 1 carcinogen. Drinking is harmful to health, even in small amounts. Claims that a certain liquor is healthy or protects the liver are as nonsense as saying a little red wine is good for the skin. The so-called 'grain liquor' is a concept; edible alcohol is also made from grain. Baijiu production methods are divided into solid-state and liquid-state. In China, most high-end brands from large distilleries use the solid-state method. But 80% of baijiu on the market is solid-liquid method, meaning grain base liquor mixed with alcohol. Many distilleries haven't seen grain for years. But 'grain liquor' isn't necessarily good, and 'alcohol liquor' isn't necessarily bad. The harm and poor taste of inferior liquor come from the fusel oils and aldehydes. Those workshop liquors touting 'pure grain brewing' and 'traditional craftsmanship' are more likely to produce inferior liquor due to poor processes and more impurities. In contrast, vodka, which is alcohol and water, is actually a decent liquor. 'Age statement' is also a concept. 'Liquor gets better with age' doesn't mean older is always better. The baijiu process includes a maturation step, where the liquor is stored under specific conditions to reduce volatile impurities and improve taste. After leaving the distillery, further aging has very limited effect. For good light-aroma liquor, aging makes little difference. For strong-aroma and sauce-aroma, which have more complex components, longer aging can help, but not too long. Drinkers often say 'three years for strong, five for sauce,' meaning this. Claims of 'decades-old liquor blending' are more gimmick than substance. Other claims, like 53 degrees being the best for alcohol and water molecule fusion, are also nonsense. Lao Miao knows saying this will offend many, but if I don't, I'm afraid my high school chemistry teacher will appear in my dreams. Baijiu's history is truly short. Even the name 'baijiu' only came into being after the founding of the People's Republic. Those who constantly invoke history and traditional culture are fooling people. The earliest accurately recorded baijiu brewing is from the Yuan Dynasty, but from the Ming and Qing dynasties to the Republic of China, baijiu wasn't widespread. Chinese liquor culture has a long history, but whether it's the elegant 'green ants, newly brewed wine' or the bold 'drink three hundred cups at once,' or the common people's aspiration of 'big bowls of wine and big chunks of meat,' none of it has anything to do with baijiu. The 'aroma types' that have been hotly promoted in recent years only emerged after the reform and opening-up. To this day, there's no clear consensus on how many types exist. Is it because it's hard to coin new words, or because experts can't tell the differences either? -05- These are the common sense about baijiu. Anyone with a junior high chemistry and high school history education should know this. Next, we'll get more professional, into consumer behavior knowledge. Moutai is indeed good, but mainly because you know it's Moutai. 'If you believe there's a secret recipe, it tastes different.' This is supported by a famous classic experiment in psychology: if we know beforehand it's a famous liquor, the brain's taste area shows clear pleasure when drinking, unless the taste difference is too great. Unfortunately, most of us can't detect subtle differences in liquor, including most tasting experts. Bitter, spicy, and choking are what normal people taste; those who can taste other flavors are 'abnormal.' 'Young people don't drink baijiu; baijiu is a sunset industry' is a claim severely lacking in business common sense. As the most important social medium commodity that has been around for thousands of years, its market capacity will further expand with the growth of social needs. 'Young people don't drink baijiu, so the baijiu market will decline' is as absurd as 'babies under one year only drink milk, so no one will eat rice in the future.' Typically, the cultivation period for baijiu drinkers is from 30 to 35 years old. From 35 to 50 is the peak drinking period for men (though alcohol tolerance has declined). After 50, as health issues arise and bodily functions decline, drinking further decreases. But many people develop a habit of drinking a little on their own. 'Wine is the matchmaker of lust' and other matchmakers. What should be discussed at the dinner table can never be settled by a few people gathering for milk tea. Starbucks tried to make coffee strongly social, succeeding halfway, but it's still not comparable to baijiu. Additionally, alcohol is a hallucinogen. Among legally usable products, it can quickly put people into a state of 'extreme happiness,' a wonderful flow state that most people yearn for, especially middle-aged and elderly people whose desires and dopamine have decreased. Drinking is their greatest joy in life, even though they want to slap themselves the next morning. This also explains why 'more cultured,' 'better tasting,' 'healthier,' and 'historically rich' yellow wine will never surpass young baijiu. Like drugs, once you have heroin, going back to opium is tasteless. People's tastes can be tamed. Regarding baijiu aroma types, I once heard the most classic 'human language': Making liquor from grain is like making tofu from soybeans. If it's clean with no impurities, it's a piece of tofu—that's light-aroma. If you think the flavor isn't strong enough, ferment it into fermented tofu—that's strong-aroma. If that's still not enough, make it into stinky tofu—that's sauce-aroma. Having a light palate, not liking stinky tofu, or being used to stinky tofu and finding tofu tasteless, or initially not liking stinky tofu but later finding it delicious—these are all normal physiological phenomena. It's not that once you're used to good, you can't accept bad. Taste has no hierarchy, but people do. Lu Xun said, 'The delicate miss sweats fragrant sweat; the ox-like worker sweats smelly sweat.' For highly social products, once high-status people collectively endorse a certain taste, that taste becomes high-end, and most of society will align with it. If you think cola doesn't taste good, it's because your taste isn't 'international'; if you think Moutai doesn't taste good, it's because your taste isn't 'high-end,' and you can't 'enjoy that blessing.' When we understand these common sense points about baijiu and consumer behavior, and know some common luxury marketing tactics, it's easy to see the brilliance of Moutai's marketing over the years. From creating scarcity to telling stories, from raising prices while controlling them, from creating authority effects to grafting financial attributes, Moutai has used almost every luxury play, with skilled execution. It has formed a powerful consumerist discourse power. Undoubtedly, Moutai has achieved unparalleled success. In the circulation market, Moutai is hard currency; at high-end banquets, Moutai is standard. -06- 'The support or opposition of the people is the key to revolutionary success.' How long this success can last depends on whether the next generation of drinkers will still buy into this. Currently, the main force at the drinking table is still the 60s, 70s, and pre-85 generation. They have undoubtedly been conquered by Moutai. Some are convinced in heart and mouth, some are convinced in mouth but not in heart, and can only suppress it. They usually think other liquors taste better, but at critical moments, they still serve Moutai. The post-85s are still new drinkers, still confused, and in the cultivation stage. The post-90s and pre-95s have just come into contact with baijiu and are still rejecting it. Most believe 'I won't drink it in the future, and no one else will.' Other consumer goods have long paid attention to the post-90s. They have become the main consumption force in many fields and the biggest driver of market growth. But for baijiu, the post-90s have not yet truly taken the stage. But the consumption views of the post-90s and Generation Z will inevitably impact the baijiu industry sooner or later. The story of Moutai 'smashing bottles at the Panama Exposition' was something we believed deeply back then, even feeling pride in 'winning glory for the country.' But in the internet age, this can be easily debunked. Even competitors use ads to tell us that the Panama gold medal wasn't won by Moutai but by our Laobaigan. The question is, do young people still care about this? Whether it's the 1949 state banquet liquor, constantly playing the 'national liquor' card, or even the 'bad taste' of girls stepping on the starter culture, these elements form the foundation of Moutai's supreme status. They played a crucial role in our generation's minds. Will they still work for future young people? Last year, Ji Keliang said in an interview that young people not drinking baijiu is because they 'haven't grown up,' sparking fierce controversy online. Mr. Ji's statement was definitely not casual. 'Establishing a contempt chain and showing appropriate arrogance' is a common tactic of old luxury brands, aiming to create a stronger sense of superiority among target customers and make some potential future customers yearn for it. But does this tactic still work on young people? At least Lao Miao thinks it's very uncertain. -07- As mentioned earlier, the 'golden twenty years' of baijiu came from the strong social attributes of baijiu, and the biggest scenario for these attributes is the Chinese-style 'drinking table.' In other words, the Chinese-style drinking table 'culture' is the soil that nurtured so many baijiu bosses. The so-called Chinese-style drinking table is essentially a large-scale 'power obedience test.' I think there's no dispute about that. Accompanying smiles, accompanying drinks, drinking to the right level, being tactful, having good eyesight, 'I'll finish mine, you do as you please,' 'Thank you for your care,' 'Everything is in the wine.' The 50s, 60s, and 70s generations, who are now at the center of power and control the most social resources, mostly came through this path. A group that gained discourse power by kneeling naturally wants later generations to kneel as well, to accept this discourse system, including how to define 'what is good liquor.' Those who were abused in their youth always hope that once they have some seniority, they can abuse the new young people in turn. Will young people kneel in the future? I think they won't. At least Lao Miao hopes they won't. Look at how the post-90s behave in the workplace and in other consumption. Growing up in an environment of superiority and abundant information, they won't submit easily, aren't easily brainwashed, and their obedience to authority is far less obvious than the previous generation. They will still drink spirits, but they won't easily have their discourse power taken away. They will be more courageous in expressing themselves. If they like Moutai, they'll drink Moutai; if they like Fenjiu, they'll drink Fenjiu. Some will like whiskey and vodka, and Erguotou and Laobaigan will also have their market. We hope the next generation is one that isn't coerced by others' discourse power, one that can fully express themselves and their own thoughts. I hope they will say, 'A man's greasiness begins when he tells young people at the drinking table what good liquor is.' Our generation of 'greasy' middle-aged and elderly people should already be parents. When you use your authority to make young people drink baijiu or good liquor, have you thought about how you want your own children to face the drinking table in the future? Will they continue to bow and scrape, saying 'I'll finish mine, you do as you please'? Or will they drink if they want, and not if they don't, coming with joy and leaving with satisfaction? This year is 2021. The oldest post-90s are just 31, and some are beginning to join the ranks of drinkers. It can be called the 'first year of new drinkers.' I believe that in three to five years, the post-90s will become an important force influencing the baijiu landscape. Lao Miao will be greasy one last time: I hope you won't be kidnapped by the older generation's discourse power, won't be fooled by 'metaphysics,' won't be attracted by bad tastes, and will stay away from the foul-smelling drinking table 'culture.' You should have your own standards of choice and your own consumer discourse system. I hope you can follow your body and your heart more. Consumerist discourse hegemony is a means of calling a deer a horse, a game of the emperor's new clothes. If you continue to live in this system, not only do you lose, but the whole society loses. Source: Lao Miao Tears Apart Marketing (id: yiheyingxiao) Tips will be paid 400-2000 yuan once adopted.