Explore the winning rules of sauce-flavored liquor companies

Reporter Gu Yufei

The sauce-fragrant liquor market is gradually centralized, and the brand echelon is clearly divided, showing a situation of "one super and many strong"; Regionalization, production capacity, nationwide and omni-channel are the core characteristics of the sauce-flavored liquor market; The main consumer groups of sauce-fragrant liquor show the "three high" characteristics of high education, high income and high consumption power.
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Recently, iResearch released the "2020-2022 Sauce-flavored Liquor Consumption Trend White Paper" (hereinafter referred to as the "White Paper"), analyzing the main trends and core characteristics of the development of the sauce-flavored liquor market and disclosing consumption insights
.
The "White Paper" shows that social, cultural and product strength will become the "plus" for sauce-fragrant liquor enterprises to win, and the capacity to expand production capacity, the price band occupation strategy of large items, and the effective national layout will become the key factors for the success of
sauce-fragrant liquor enterprises.

The situation of "one super and many strong" is formed

In 2017, under the leadership of Moutai, the sauce-fragrant liquor category ushered in development opportunities, and Moutai, as the industry leader, cultivated more than 50 million consumer groups, allowing more and more consumers to feel the uniqueness of
sauce-fragrant liquor.
At the same time, the head brands represented by Xijiu, Zhenjiu, Guotai, Jinsha, etc.
have also jointly promoted the development of
the sauce-fragrant liquor industry.

"The growth rate of sauce-fragrant liquor companies is generally higher than the average level of the liquor industry, and the sub-high-end series have begun to undertake the spillover dividend
of Moutai's popularity.
The sauce-flavored liquor brand as a whole presents a pattern of 'one super and many strong', and the competition is becoming increasingly fierce
.
"The White Paper shows that in 2021, the total revenue of China's sauce-flavored liquor market will reach 190 billion yuan, a year-on-year increase of 22.
6%, and sales revenue will account for about 31.
5% of
China's liquor market.
At present, the number of sauce-flavored liquor enterprises in China has reached more than 1,000, which can be divided into 6 echelons
according to the scale of revenue.
Moutai topped the list with an absolute market share of about 65%; Xijiu and Langjiu rank in the second echelon with an annual revenue of more than 10 billion yuan; Zhenjiu, Guotai and Jinsha have an annual revenue of 5 billion to 10 billion yuan, ranking the third echelon, and in the future, they will impact the scale circle of 10 billion yuan by virtue of the advantages of capacity expansion and core large products; Other brands with annual revenue of less than 5 billion yuan will also gradually enrich the competitive landscape
of the sauce-flavored liquor industry.

In recent years, enterprises in the top three echelons have launched large items to occupy the corresponding price band, and these influential core large items have become the "hard currency"
of the exclusive price band in the minds of consumers.
The White Paper shows that from the perspective of price distribution, the price band of sauce-flavored liquor shows the characteristics of "inverted triangle"
.
According to the division of terminal retail prices, a single bottle of more than 1,000 yuan belongs to the high-end price band, Feitian Moutai occupies an absolute dominant position, and the Qinghualang of Langjiu has gradually raised the price in the past two years, becoming a strong product
with a price of 1,000 yuan.
The price band of 500-1000 yuan belongs to the sub-high-end market, and it is also the hottest area
with the most fierce competition and many categories in addition to the "Moutai position".
Driven by consumption upgrades, consumers' awareness of sauce-flavored liquor has gradually matured, and they are willing to pay more
.
The price below 500 yuan has many low-end brands "emerging", but due to the high value of sauce-flavored liquor itself and the complex brewing process, low-end sauce-fragrant liquor products account for a relatively small
proportion of the overall sauce-fragrant liquor market.

"Star products support the upgrading and development of sauce-fragrant liquor brands, which is the cornerstone of forming a strong brand and corporate cognition, and is a classic
in the industry.
" The White Paper proposes that the launch of large items can not only occupy a more favorable development position in the market, but also reflect the company's own strength, because the launch of core large items means that enterprises must have strict control of product quality, keen perception of the market, mature market publicity capabilities and nationwide distribution system layout
.

Presents four core features

In the past two years, the sauce-fragrant liquor industry has entered a new development cycle, what are the characteristics of the sauce-fragrant liquor market? The "White Paper" is summarized as: production area, production capacity, national and omni-channel
.

Guizhou is the birthplace and main production area of sauce-fragrant liquor, with thousands of sauce-fragrant liquor enterprises with a production capacity of about 500,000 kiloliters
.
The "Opinions of the State Council on Supporting Guizhou to Blaze a New Road in the Great Development of the Western Region in the New Era" issued in January this year proposed to give full play to the advantages of the origin and main production area of sauce-fragrant liquor in the Chishui River Basin to build an important liquor production base
in the country.
In July, the Guizhou Provincial Development and Reform Commission issued a notice proposing to vigorously promote the implementation of 2,500 key private investment projects, including more than 60 alcohol projects
.
In 2022, the list of major projects and key projects in Guizhou Province involved 61 alcohol projects
.
It is foreseeable that from 2022 to 2025, the production capacity of liquor in Guizhou Province will increase rapidly, which will have an important impact
on the pattern of sauce-fragrant liquor industry.
Specifically, these projects are mainly concentrated in the Renhuai production area led by Moutai, the Xishui production area led by Xijiu, and the Huichuan production area
led by Zhenjiu.
"The three major production areas rely on each other to form the largest sauce-flavored liquor industry cluster
in China.
" The "White Paper" shows that the core production area is the embodiment of the high quality and scarcity of sauce-flavored liquor, and the "golden triangle" trend of high-quality sauce-flavored liquor is emerging
.

In recent years, the head sauce brands have been laid out and expanded production capacity
.
In the first half of this year, Moutai completed the output of Moutai wine base wine of 42,500 tons, the output of series wine base wine of 17,000 tons, and the future Moutai plans to form a production capacity
of 56,000 tons of Moutai wine and 56,000 tons of series wine.
After the first phase of the technical transformation project was put into operation this year, the new production capacity of Xijiu reached 18,000 tons, reaching 40,000 tons, and by the end of the "14th Five-Year Plan" period, the production capacity of Xijiu may reach 100,000 tons
.
Langjiu will fully produce 60,000 tons of sauce-flavored liquor in the five major ecological winemaking areas in the second sand season this year, and plans to store 300,000 tons
of liquor in 2026.
Zhenjiu put into production of 35,000 tons in the sand season of Chongyang this year, with a new brewing capacity of 140,000 tons, and it is planned that the production capacity will reach 100,000 tons and the storage capacity of 400,000 tons during the "15th Five-Year Plan" period, ranking among the top three
sauce wine enterprises in Guizhou Province.
"Sauce-flavored liquor enterprises have made efforts to expand production capacity to enhance their comprehensive strength
.
" The "White Paper" shows that at present, the sauce-flavored liquor industry is still in the stage of consumption recovery and demand expansion, and there is still a gap
in the total supply, especially the supply of high-quality sauce wine.
In the future, in the competition of sauce-fragrant liquor brands, production capacity is crucial, tonnage largely determines the brand status, larger production capacity means that the overall comprehensive strength of the brand is stronger, more products are put on the market, and the future development potential is greater
.

In recent years, sauce-flavored liquor brands have been layered nationwide to expand the consumer market
.
"Around 2016, sauce-fragrant liquor gradually entered a period of recovery, and gradually gained momentum in some areas of the national consumer market, in addition to the main production area of Guizhou, sauce-fragrant liquor is also gradually entering other provinces and regions, such as Guangdong, Henan, Shandong and other places
.
" The White Paper proposes that the Pearl River Delta, Yangtze River Delta and North China are the main development-oriented consumer markets
for sauce-flavored liquor in the future.
In the future, with the expansion of production capacity and the continuous highlighting of branding advantages, sauce-fragrant liquor will form a national sales layout
.

Moutai accelerated the construction of "Smart Moutai" and successfully launched the "i Moutai" digital marketing platform; Through IP activities such as "Junpin Yaban", Xijiu launched Junpinxijiu, a super large item, which hit the price band of 1,000 yuan; Langjiu is based on Langjiu Estate to carry out diversified experience activities.
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In recent years, sauce-flavored liquor companies have carried out diversified omni-channel layout
.
According to the white paper, due to the impact of the epidemic, the marketing of traditional offline channels has been hindered, and online channels and special experience stores have developed rapidly
.
The mainstream sales channels of sauce-flavored liquor have been upgraded from the original single offline channel to an omni-channel marketing system combining self-operation, immersive experience marketing, various tastings and new retail, etc.
, to enhance consumers' experience in multiple aspects, so as to further achieve both volume and price increases
.

The characteristics of "scene consumption" are highlighted

"Among the 25-29 year olds, 52% choose sauce-flavored liquor, which is 1 percentage point higher than the proportion of 35-39 year olds; In the past year, 25%-29 year olds purchased 8-10 bottles of sauce-flavored liquor at a time; Compared with other liquor categories, the middle and high-income groups are the main consumers of sauce-flavored liquor
.
The "White Paper" shows that at present, the consumer groups of sauce-flavored liquor are mainly business people and the middle class, and also show the "three high" characteristics
of high education, high income and high consumption power.

In terms of consumption scenarios, the White Paper shows that corporate colleague dinners account for 25% of young consumers' consumption scenes of sauce-flavored liquor, business banquets account for 17%, and family and friends gatherings account for 24%.

In business activities, sauce-fragrant liquor in the price band of 500-1000 yuan is the most favored, and Moutai, Xijiu and Langjiu are the main consumer brands
.

"In terms of consumer preferences, consumers choose soy wine brands mainly based on factors
such as the quality, cultural value and taste of famous wines.
" The White Paper proposes that when purchasing by the younger generation, consumers will mainly consider
the taste, degree, brand history, origin and year.
Among them, "taste" is still the primary concern of young people when buying different brands of sauce-flavored liquor, accounting for 31%, and brand value/popularity accounting for 16%, ranking second
.
Therefore, on the basis of taste, famous wine and cultural value are the "pluses"
of the brand's success.
The stickiness of new users to the brand is relatively low, and the taste can also become a breakthrough in expanding new ones
.
Consumers need to adapt to changes in taste, and many people try to change brands
because they are not used to the taste of sauce wine.
Through comparison, it is found that most consumers who change brands have just entered the sauce-fragrant liquor drinking circle
.
Due to the lack of understanding of the taste of sauce-flavored liquor, it is still in the stage of constantly changing brands, and it will be considered comprehensively when choosing brands, and the purchase decision is more cautious
.
Therefore, sauce-flavored liquor enterprises in the second, third and fourth echelons should expand their brand consumer groups
by actively carrying out various marketing activities and increasing the number of offline counter displays.

China Food News(November 21, 2022, Version 04)

(Responsible editor: Gu Yufei).