China’s Liquor Industry Insights

Economic GrowthChina's liquor industry

The rapid economic growth in China has led not only to “westernization”, but also a measured increase in liquor consumption. A long standing favorite among Chinese is baijiu, a distilled liquor with a very high alcohol content. But more and more consumers from various regions are turning towards Western liquors such as beer, wine, whiskey and others. Large corporations such as Molson Coors Brewing Co., SABMiller plc and others largely dominate the Western alcoholic beverage market in China.

Popular Western Beverages

China has enjoyed immense economic growth over the last two decades, affording the middle class more disposable income with which to enjoy a larger variety of alcoholic beverages. The booming economy inevitably brought large amounts of alcoholic beverage imports into the country, with beer becoming one of the favourites among Chinese drinkers as it conveniently pairs quite well with traditional Chinese food. Today, China is the largest consumer of beer in the world, as well as spirits such as baijiu, vodka, whiskey and brandies.

Another popular and fast-growing Western beverage among Chinese is wine. China is projected to take over the #2 spot in wine sales by 2020, surpassing both France and the UK, yet ranks only 36th in the world on a per capita consumption basis demonstrating the incredible room for growth the industry still has there. China’s wealthy still prefer prestigious foreign wines to their own brands, using them as a social vehicle to ‘show off’ and improve their social status, demonstrated by the fact that more than 20% of wine consumption in China is of imported brands.

The Challenges of China’s Liquor Industry

Counterfeiting is one of, if not the biggest, issues China’s liquor industry faces. Consumers do not trust retailers, thus it is hard to enter the market and acquire initial market share. Customers are afraid of being duped into buying low-quality wines that might be branded and labeled as expensive or ‘high-end’. To protect customers, authorities have begun using QR codes that allow buyers to scan the code and get the information on the product such as production date, as well its shipping or transportation history. In order to protect brands and combat copycats or lookalikes, Web Presence In China (WPIC) developed a powerful program called ‘Discripto’ that allows companies to find, track, and remove any counterfeit products being sold online from third party sites such as Taobao, Tmall, Alibaba, Baidu and JD, as well as standalone sites. WPIC deploys programmatic technology and produces a comprehensive list of trademark violators, counterfeiters, and grey market resellers. By leveraging long-standing relationships with China’s aforementioned ecommerce platforms, WPIC can quickly source and remove violators, ensuring top ranked results on search engines, reducing advertising competition, and protecting a brand’s name and reputation.

Another significant challenge for brands coming to the Chinese market is to establish effective communication with consumers. For businesses that want to be a part of the Chinese online space it is critical to have a locally-hosted and managed website. Read more here…

About WPIC

Beijing-based Web Presence In China (WPIC) is an independent, full service digital marketing and IT development agency. Having over 13 years of on the ground experience in the China digital sector, the firm has worked with over 300 global companies and leads a team of 120 people between their global offices. WPIC supports China and the greater APAC region in digital and IT solutions.