Is “Moutai+” Moutai’s panacea?

This article analyzes in detail the advantages and challenges of the "Moutai+" strategy, emphasizing the importance of careful balance. It explores the impact of Moutai's main business and cross-border cooperation on economic income, and emphasizes the value of reasonable and orderly cross-border cooperation to Moutai's long-term development.

From Moutai ice cream to the now popular sauce-flavored latte and Moutai chocolate, is the "Moutai+" strategy Moutai's panacea?

1. Moutai is very busy with cross-border marketing

If you ask which brand is hot recently, the answer is of course Moutai, and Moutai is very busy.

First, on September 4, Moutai and Luckin Coffee jointly launched the sauce-flavored latte, which topped the trending searches on the day of its launch. The entire circle of friends was filled with the aroma of the sauce, and netizens shared their experiences with the new product of "fine wine + coffee".

The next day, Luckin Coffee officially announced that the sales volume of its sauce-flavored latte exceeded 5.42 million cups on the first day, and the sales volume of its sauce-flavored latte exceeded 100 million yuan on the first day. Sauce-flavored latte is definitely the "hot product king" in the beverage industry in 2023.

Through the joint cooperation between Moutai and Luckin Coffee, both parties have achieved fame and fortune. This cross-border marketing cooperation case can be included in the classroom project case of MBA in business schools.

After cooperating with Luckin Coffee, Moutai did not stop. The popularity of its sauce-flavored latte has not yet dissipated. Only 10 days later, on September 14, Moutai announced a partnership with chocolate brand Dove and launched a new product, Mao Xiaoling liquor-filled chocolate, on September 16.

According to Moutai's official introduction, the chocolate with liquor filling in this collaboration adds 2% of 53%vol Kweichow Moutai Liquor, and is sold in limited quantities through multiple channels including online e-commerce and offline supermarkets.

The co-branded chocolates include classic and reduced sugar flavors, with specifications of 20g for 2 pieces and 120g for 12 pieces. Among them, the classic liqueur chocolate gift box with 2 pieces is priced at 70 yuan/2 boxes, and 169 yuan/box for 12 pieces, and the reduced sugar liqueur chocolate gift box with 12 pieces is priced at 179 yuan/box.

This Moutai chocolate with a 2% Moutai content is priced at 35 yuan for two pieces, which is almost as expensive as luxury chocolate brands. However, the high price has not stopped consumers' curiosity and enthusiasm.

As expected, Moutai chocolate became popular even before it was released on the market, and was on several hot searches in a row. When the three types of Moutai chocolate went on sale on the 16th, they were all sold out within one second.

In offline stores, Moutai chocolate is also very popular. Long queues appeared in Moutai ice cream shops in many parts of the country. Some people queued for more than an hour just to buy Moutai chocolate, and some even bought more than a dozen boxes at a time.

However, it is worth noting that Moutai chocolate soon appeared on second-hand platforms, and some people began to resell the chocolate they had snatched. The original price of a 12-piece sugar-reduced chocolate gift box with wine filling, which was 179 yuan, has been increased to 500 yuan.

More than a year ago, since Moutai launched Moutai ice cream, it has started a series of "Moutai+" strategies, opening Moutai ice cream shops and launching diversified products in Moutai ice cream shops in many cities across the country, such as Moutai pearl milk tea in the Shenyang store, Moutai fruit tea in the Shenzhen store, and cakes containing Moutai ice cream in the Qingdao store.

Moutai is very busy when it comes to cross-border joint marketing.

2. Younger, market effect, and economic account

Looking at the entire Chinese liquor industry, Moutai has made frequent market moves in recent years, especially the launch of the "Moutai+" strategy, which has achieved broad market comprehensive effects.

In the view of Xinpinlue Finance, why Moutai launched the "Moutai+" marketing strategy can be seen from three different aspects: younger generation, comprehensive market effects and economic accounts.

First, let’s look at the younger aspect. This is what Moutai wants to do most, which is to capture the young people.

Liquor is a traditional industry. Logically speaking, liquor consumption is mainly among middle-aged and elderly groups, but the reality is that in recent years, China's liquor sales have shown a gradual downward trend.

According to data from the National Bureau of Statistics, in 2022, the output of liquor enterprises above designated size was 6.712 million kiloliters, a year-on-year decrease of 5.6%. This is also the lowest output of the liquor industry in the past 10 years.

The liquor industry has long entered an era of stock competition. Sales to existing consumer groups have declined, and liquor manufacturers must find new growth points. This requires capturing the new generation of young people and narrowing the distance between themselves and them. Whether it is the sauce-flavored latte or Moutai chocolate, this is the purpose.

But young people don't like to drink liquor, which makes liquor manufacturers anxious. According to the report "Young People's Liquor", only 11.2% of young people like liquor with an alcohol content of more than 30 degrees, and among young people's alcohol choices, liquor accounts for only 13%, ranking behind wine, fruit wine, whiskey and beer.

Players in the liquor industry are actively seeking to rejuvenate their brands, and each has come up with its own strategies. However, Moutai has done better in this regard, and other competitors are very envious.

Looking at the market effect, Moutai wants to achieve multiple goals at one stroke and comprehensive market effects.

Any cooperation between two companies, whether based on brand effect, marketing effect, or even commercial economic return, aims to achieve multiple goals at one stroke.

Taking Maotai latte as an example, coffee is a mass consumer product, while Moutai is a high-end liquor consumer product, which can be said to be a luxury-level liquor. They have different consumer groups, but one is China's largest coffee chain brand, and the other is the number one in China's liquor industry. When the two industry big brothers join hands, the comprehensive market effect they achieve is different.

Judging from the market response to Moutai's Maotai sauce-flavored product, this joint marketing campaign has enabled Moutai to achieve multiple goals at one stroke and realize the greatest comprehensive market effect.

Third, in terms of economic accounts, Moutai does not attach much importance to it, after all, its contribution is limited.

Moutai is the leader in China's liquor industry, with a market value of trillions of yuan and annual revenue exceeding 100 billion yuan. From an economic account perspective alone, the "Moutai+" strategy does not contribute much to Moutai's overall economic revenue.

Data shows that in 2022, Moutai Cultural Tourism Company successively launched more than 10 Moutai cultural and creative products, contributing nearly 600 million yuan in output value to Moutai.

According to Moutai Chairman Ding Xiongjun at the 2023 Market Work Conference, Moutai ice cream is expected to achieve revenue of 262 million yuan in 2022. According to Kweichow Moutai's 2023 semi-annual report, the hotel business and Moutai ice cream business revenue were 220 million yuan.

It can be seen that the sales brought by new products jointly launched by Moutai and other brands, such as ice cream, coffee products, and chocolate, are just a drop in the bucket for Moutai and not worth mentioning.

But in the commercial battlefield, Moutai also needs to constantly seek innovation, change, tell new stories, and launch new actions. All of Moutai’s "Moutai+" strategies ultimately have only one goal: to expand the cultural influence of Moutai, especially to expand its influence in the minds of the new generation of young people.

3. Is “Moutai+” Moutai’s panacea?

Ever since Moutai launched ice cream, it has become very popular. This year, it has launched products such as Maotai latte and Moutai chocolate. There is also a popular view in the market: everything can be Moutai.

Behind the view that everything can be Moutai, some people believe that "Moutai+" will become Moutai's universal strategy, and can even achieve any goal of "Moutai+N".

However, in the view of Xinpinlue Finance, "Moutai+" is not a panacea, especially for Moutai. Behind any "Moutai+" market action is a cautious and balanced choice.

Take the cross-border joint cooperation of Maotai Latte as an example. Since the launch of this product, many people have been discussing one thing: who is relying on whom in the joint cooperation between Moutai and Luckin Coffee? Who is relying on whom? Who is gaining more than the other?

There are two main viewpoints in the market:

The first point of view: Moutai values ​​Luckin’s size, and Moutai wins more than Luckin.

Luckin Coffee is the largest coffee chain brand in China, with tens of thousands of stores. It is a veritable national coffee brand. Moutai is attracted by its market size, customer reach, and the comprehensive market effect that can ultimately be achieved, so Moutai is the big winner.

The second view is that Moutai is a high-end liquor brand, and the cooperation between the two parties is Luckin Coffee trying to reach the pinnacle of Moutai.

There is no need to talk about Moutai's status in the Chinese liquor industry. The Maotai sauce-flavored latte is a result of Moutai's self-depreciation in cooperation with Luckin Coffee, while Luckin Coffee is just a mass-consumption coffee chain brand. The brand status of the two is not comparable, so Luckin Coffee is trying to climb up to Moutai.

Regarding the cooperation on the sauce-flavored latte, there are different opinions and voices in the liquor industry and within Moutai.

According to Tencent News Prism, a person familiar with Moutai analyzed that the current Moutai Group Chairman Ding Xiongjun is the promoter of Maotai Latte and Moutai ice cream. He hopes to narrow the distance between Moutai and young people through a series of marketing methods. However, there are different voices within Moutai about such marketing. They believe that cooperation with Luckin will damage Moutai's high-end image.

Cross-border joint cooperation can allow more young people and consumers to get in touch with Moutai and narrow the distance between them. However, for young consumers, if Moutai continues to launch more and more joint activities, Moutai may no longer be "out of reach".

The key reason why Moutai is Moutai is its high-end brand image, industry status and market reputation. Ultimately, it is scarcity. If there are too many cross-border marketing collaborations, the brand value of Moutai will definitely be diluted.

A recent case has caused controversy over Moutai's cross-border marketing. On September 17, the "Jiangxiang King Room" packages priced at 999 yuan and 2999 yuan were launched on the Fliggy platform and became popular again. In fact, this cross-border cooperation was not launched by Moutai Group or jointly launched with Moutai, but by suppliers cooperating with the Moutai Resort in Haitang Bay, Sanya, who supplied goods to Fliggy and the platform gave subsidies.

Under controversy and public pressure, the "Moutai Double Bed Room" was suddenly taken off the shelves and was required to make rectifications.

Moutai is for drinking, coffee is also for drinking, and chocolate is for eating. When you eat and drink them together, Moutai smells quite good, but the sauce-flavored king-size bed room will seem out of place. Such cross-border marketing is obviously not a plus for Moutai, but a negative case.

Xinpinlue Finance has always been paying attention to the new business field and believes that good cross-border brand joint marketing and cooperation can kill multiple birds with one stone and make people feel comfortable. If it is a forced joint marketing, it will definitely be a failure and it is better not to do it.

What is more important is that Moutai’s main business is liquor. If “Moutai+” is a panacea and it really is “everything can be Moutai”, then Moutai will become a supplier of raw materials, and Moutai does not want that.

On September 16, Moutai Chairman Ding Xiongjun said at the launch of Moutai chocolate that as a traditional Chinese brand enterprise, Moutai must embrace the younger generation of "Generation Z" to remain young and enhance its vitality. At present, Moutai has completed the ecological layout of the product matrix of "drinking, eating, tasting, drinking, and carrying", that is, drinking Moutai, eating Moutai banquets, tasting Moutai ice cream, drinking sauce-flavored latte, and carrying chocolate with liquor. At this point, the development of "+ Moutai" peripheral products will also come to an end.

This shows that Moutai has not given no thought to cross-border cooperation.

Author: Wu Wenwu, WeChat public account: Xinpinlue Finance (ID: nbscaijing)