In supermarkets, promotions like "second item half price," "second bottle for 1 yuan," or "buy one get one free" across different brands have become the norm. Once-premium dairy products have all cut prices: Telunsu 250ml/12-pack is now as low as 28.42 yuan in some supermarkets; Jindian pure milk 250ml/12-pack is at a minimum of 33.9 yuan, and New Hope Aotelan organic pure milk 250ml/10-pack is also at 33.9 yuan. Discount supermarkets and private-label milk have hit rock-bottom prices: Ele.me's Xiaoxiang Supermarket sells 1.5L for 13.9 yuan (2.3 yuan/250ml), Wook's 4.0 pure milk 950ml is 9.9 yuan (2.6 yuan/250ml), Hema's NB fresh milk 950ml is 6.9 yuan (1.82 yuan/250ml), and 7Fresh's 1L ambient milk is 5.9 yuan (1.475 yuan/250ml). According to Jiuqian data, as of April 2026, dairy products under 55 yuan on e-commerce channels grew fastest at 55%, while products priced between 100 and 237 yuan saw sales decline by 6.4%. Premium milk is no longer selling well. On one hand, the overall dairy market is shrinking: NielsenIQ data shows that in 2025, total dairy sales across all channels fell by 8.6%, and in January 2026 alone, they dropped 17.2%. The industry has left the high-growth era of the past decade and entered an adjustment period, with brands cutting prices and clearing channel inventory. But the deeper reason is that when consumers realize the nutritional difference between 10-yuan milk and 3-yuan milk isn't that significant, they stop blindly paying for the "premium" concept. The old story of relying solely on marketing concepts, packaging, and scarce milk source narratives to support high premiums has failed. Replacing it is another set of growth data:
In the milk powder and dairy products segment, Yili grew 13.7% year-on-year in the first three quarters of 2025, with a 25% market share in adult milk powder in 2025;
In the fresh milk segment, New Hope Dairy maintained double-digit growth, with Q3 fresh pure milk sales up nearly 20% year-on-year;
The deep-processed dairy market has reached 61.5 billion yuan;
The functional dairy market is valued at 80 billion yuan, with an expected compound annual growth rate of 15%-20% over the next three years. In other words, premiumization is undergoing a dramatic divergence. Has dairy premiumization failed? Mengniu's Telunsu, launched in 2005, is the most successful example of dairy premiumization. Mengniu's revenue structure is known as the "888 structure": about 80% of the company's revenue comes from liquid milk, about 80% of liquid milk revenue comes from ambient milk, and about 80% of ambient milk revenue relies on Telunsu. Based on this, Telunsu alone contributes approximately 51.2% (80%×80%×80%) to Mengniu's total revenue. It can be said that Telunsu is the absolute pillar of Mengniu's performance. In the second half of 2025, Telunsu proactively cut prices. Its core premium product, Desert Organic Milk, dropped from 118 yuan per box to 99 yuan, a 16% reduction, while other classic Telunsu products saw terminal price cuts of 10-11 yuan per box. Moreover, this price cut was entirely brand-led: the company directly subsidized distributors and publicly promised "no price adjustments for the rest of the year." In a zero-sum market, price cuts are reflected in financial reports. Mengniu's liquid milk revenue fell from 73.065 billion yuan in 2024 to 64.939 billion yuan, a year-on-year decline of 11.1%, far exceeding the group's overall revenue drop of 7.3%. At the 2025 earnings call, Mengniu President Gao Fei admitted: "Prices have dropped by about 3%." If Telunsu's premium positioning of "Not all milk is Telunsu" has hit a growth bottleneck in a stagnant market, then Telunsu's "disciple"—Yuexiu Huishan's "Xie Tiandi," launched in November 2024—is like "carving a mark on a moving boat" during an industry downturn. The mastermind behind Xie Tiandi is Bai Ying, a founding member of Mengniu and the creator of the Telunsu model. After joining Yuexiu Huishan, he attempted to replicate Telunsu's success with scarce milk sources and brand bombardment. Xie Tiandi's 4.3g protein Jersey milk was priced at 12.8 yuan per box, dubbed the "Hermès of milk," and was once seen as a new benchmark for dairy premiumization. Its title sponsorship of a popular Mango TV variety show reportedly cost tens of millions. However, just a year later, Xie Tiandi's price in offline channels has fallen to 3.5 yuan per box, a drop of over 70%. From Telunsu to Xie Tiandi, the story of premiumization in China's dairy industry has changed. Over the past 20 years, China's dairy industry was in an "incremental market" phase—per capita dairy consumption of urban residents grew from 9.9 kg/year in 2000 to 18.3 kg/year in 2006, with an average annual growth rate exceeding 10%. In this rapidly growing market, Telunsu's success logic was simple: on top of basic products, it carved out a "better" market segment using concepts like "higher protein content," "limited milk sources," and "organic certification," selling to middle-class families willing to pay more for quality. This approach was later copied by brands like Yili Jindian and Bright Youbei, with new concepts continuously added: A2 protein, Jersey cows, grass-fed, organic, lactose-free... Each new concept came with a round of price increases. At its peak, a 250ml bottle of milk could sell for dozens of yuan. The effectiveness of this model depended on information asymmetry and channel control. Consumers didn't know how much nutritional difference there was between A2 and regular milk, and brands could use advertising and premium supermarket shelf placement to create the perception that "expensive equals good." But today, several premises are collapsing. First, information barriers have been broken. The rise of "ingredient-focused" consumer culture has taught consumers to read ingredient lists and compare nutritional content. Nutrition experts have long pointed out that regular milk contains about 3g of protein and 100mg of calcium per 100ml, while so-called premium milk typically has 3.4-3.6g of protein and about 110mg of calcium—a difference far smaller than the price gap. A 12.8-yuan bottle of Xie Tiandi Jersey milk has about 0.7g more protein than regular milk—equivalent to less than two eggs' worth of protein. Paying nearly four times the price for two eggs' worth of protein is a calculation more and more consumers are making. Second, the channel landscape has changed. In the past, the premium of high-end milk relied on the "price barrier" of specific channels like premium supermarkets and convenience stores. But today, "super channels" like Hema, 7Fresh, and Xiaoxiang Supermarket are reshaping the rules. These channels have their own traffic and user trust, and they are launching private-label milk—7Fresh's 2L fresh milk customized with New Hope's Tianxiang Dairy sells for only 15.5 yuan, and its 1L ambient milk customized with Tianjin Haihe Dairy sells for only 5.9 yuan. When consumers find that private-label prices are 30%-50% lower than traditional big brands, with no obvious quality difference, "brand premium" begins to evaporate. Third, the marginal benefit of "high-profile" marketing is diminishing. Xie Tiandi's case is a textbook negative example. Its parent company Yuexiu Huishan hired Bai Ying, who had managed Telunsu, as general manager, invested tens of millions in title sponsorship of a Mango TV variety show, and tried to replicate Telunsu's "advertising blitz + scarcity story" model. But the result was that the name "Xie Tiandi" spread across the internet, yet many people "had heard the name but didn't know it was milk." In an era of information overload and fragmented attention, simply throwing money at variety shows can no longer build effective brand mindshare. The Moshangying Price Index (WPI) shows that from April 2024 to March 2026, dairy prices faced overall downward pressure, with WPI below 100 for most categories and most of the time, indicating year-on-year price declines (WPI is benchmarked at 100, with fluctuations representing the relative percentage change compared to the same period last year). From "Selling Stories" to "Providing Evidence" Traditional premium liquid milk is facing unprecedented price pressure, while affordable milk is expanding rapidly. This is not simply a "everyone is broke" overall consumption downgrade, but rather a consumption stratification. According to Hou Junwei, general manager of Shanghai Ruinong Consulting, the current dairy market shows a "both high and low prosperity" characteristic. Growth in high-end consumption comes from two groups: One is high-income, upper-middle-class consumers with stable consumption habits, largely unaffected by the economic environment; The other is the lower-middle class, who have increased purchases due to a 20% price cut in premium dairy. Meanwhile, consumers of high-value-for-money products include three types: habitual heavy consumers, new consumers, and those who have "downgraded" due to changing income expectations. It's not that there is no high-end demand, but rather a mismatch between high-end supply and real demand. Those truly willing to pay consistently for "ultimate milk quality" are likely those with an Engel coefficient below 0.2, who have achieved freedom in "eating." Based on China's population structure, this group is estimated at around 100 million people. This is a sizable market, but not enough to support all dairy companies simultaneously "moving up." According to observations from Jiuqian Zhongtai, compared to three years ago, the biggest difference in consumers is: previously they were more easily persuaded by brands, imported packaging, and premium shelves; now they care more about "why it's expensive, where the extra cost goes, and whether it suits me." In the past, they recognized brands and bought stories; now they check ingredient lists, nutritional parameters, functional components, taste and texture, and whether the channel and fulfillment are reliable. In the past, they paid for imagined quality; now they only pay for value that is verified, perceived, and solves specific problems. This means that those still willing to pay a premium for high-end dairy are not just "high-income people," but more precisely, those with high task density, high risk aversion, and high information sensitivity. These mainly include: Maternal and child families, willing to pay for safety, absorption, and low allergenicity;
Seniors and household health managers, focusing on calcium, protein, and sugar control; fitness and weight-loss groups, pursuing high protein, low sugar, and low burden;
Those with sensitive stomachs or lactose intolerance, particularly sensitive to A2, lactose-free, and clean-label formulas. Additionally, gifting scenarios still exist at specific times. Data from Moshangying Intelligence Station shows that in Q1 2026, ambient pure milk, ambient yogurt, and cheese performed poorly, but low-temperature pure milk and middle-aged/elderly milk powder saw year-on-year sales growth of 30.7% and 27.4%, respectively, while low-temperature yogurt sales also rose 11.80%. The mixed performance across categories may indicate that consumers haven't stopped drinking milk, but are changing their choices about "what milk to drink." Greek yogurt, a niche category in low-temperature yogurt, is a typical example of premiumization growth. Compared to regular yogurt, Greek yogurt filters out a large amount of whey (water + lactose + some minerals), making it thicker and more "concentrated" in nutrition, popular among sugar-controlled/low-carb dieters. Greek yogurt is priced several times higher than regular yogurt; for example, Oarmilk's 720g family tub sells for about 46-66 yuan (6.5-9 yuan per 100g). Oarmilk, founded only five years ago, has sales approaching 1 billion yuan, with online repurchase rates twice the industry average. Its strategy is to serve only the top 10% of consumers by spending level in 60 high-tier cities, totaling about 50 million people. Before establishing the brand, Oarmilk spent three years and 240 million yuan building China's first factory dedicated to Greek yogurt production, with a daily raw milk processing capacity of 800 tons. The core equipment is a whey separator from Germany's GEA, each worth over 10 million yuan, and fewer than five factories nationwide have similar production lines. Low-temperature pure milk also aligns with consumers' demand for freshness and health, making it a standout growth category. The biggest pain point of low-temperature milk is its short shelf life and limited distribution radius. Traditional pasteurized milk has a shelf life of only about 7 days, strictly limiting its sales radius to the vicinity of the factory. Junlebao's "Yuexianhuo," launched in 2017, uses INF 0.09-second ultra-instant sterilization technology, extending shelf life to 19 days—12 days longer than traditional pasteurized milk. Junlebao claims that this technology, developed jointly with Jiangnan University, not only preserves more active protein but also expands the cold-chain distribution radius from 300 kilometers to 1,500 kilometers, truly enabling "northern milk sold in the south." In 2024, Yuexianhuo topped China's high-end fresh milk market with a 24.0% market share. The structural shift in the dairy premiumization market reveals a core question: since the old model has failed, but premiumization itself has not been denied, what is the viable path to premiumization in the new environment? For this question, Jiuqian Zhongtai's research shows: broad-based premiumization for the mass market is receding, while a new, evidence-based premiumization targeting narrow audiences and strong scenarios is emerging. Can per capita dairy consumption still grow? An unavoidable reality is that China's per capita dairy consumption remains low. According to data from the National Bureau of Statistics, the Ministry of Agriculture and Rural Affairs, and industry reports, China's per capita dairy consumption has hovered around 40-42 kilograms in recent years, only one-third of the world average and half of the Asian average. Moreover, compared to the recommended 300-500 grams per person per day (equivalent to 110-183 kg annually) in the "Dietary Guidelines for Chinese Residents (2022)", current actual consumption is only about 37% of the lower limit of the recommendation. Wang Dingmian, executive director of the China Dairy Association, once said bluntly that it is unnecessary to deliberately divide milk into "high-end" and "low-end," and even in mature dairy markets like Europe and the US, such distinctions are rare. "Milk is milk; its fundamental nature hasn't changed. Even after ten thousand years, it's still milk." This judgment, though absolute, highlights a core fact: milk is a highly standardized agricultural product, not an industrial product that can be infinitely differentiated. When all brands can get Jersey cows, produce A2 protein, and claim organic, the so-called "premium" becomes just a marketing shell without substantive technical barriers. Compared to other countries, China's dairy farming costs are high, and expensive testing costs and circulation premiums mean that the final retail price of milk is not cheap, far higher than in the US, Japan, India, Brazil, and other countries. If milk is priced at 12.29 yuan per liter, to meet the recommended daily intake of 300 grams per person, milk expenditure would account for 22.2% of rural residents' food spending and 13.8% for urban residents, making it unaffordable for many low-income people. Private-label milk from Hema and 7Fresh can offer high-quality milk at low prices by shortening the supply chain—removing intermediate links, absorbing marketing costs through their own channels, and deep customization with regional dairies—which helps boost per capita dairy consumption. China's dairy industry is at a critical juncture of transformation. With a temporary surplus of raw milk, persistent low-price competition, and increasing polarization, in this environment, "fake premium" products relying solely on concepts and marketing will be eliminated, while products that deliver real value will gain pricing power. As the "Xie Tiandi"s lose their halo, future competition will be a comprehensive contest of supply chain efficiency, cost control capabilities, and insight into consumers' real value.