International alcohol brands continue to have more potential to grow and expand in China’s spirits sector. The increase of the country’s luxury customer base among the urban population is at the heart of this trend. Mersol & Luo assists businesses in navigating the process of importing and profiting from these favorable market conditions.
China’s demand for imported spirits is increasing.
As China’s middle-class population grows, so does demand for new flavors and a wider range of alcoholic beverages. International spirits manufacturers are recognizing the market’s numerous opportunities for their enterprises. Although brandy continues to dominate China’s imported liquor market, accounting for over 75% of all imported liquors in 2018, other hard spirits have made significant gains in recent years. Imports of brandy were more than $1 billion in 2018, up 20.6 percent from 2017. Whisky imports increased by 27.6% in value, while vodka and rum imports were valued at US$16.7 million and US$7.9 million, respectively. Tequila and gin imports are still tiny in comparison to other spirits, but they are growing rapidly. While imported spirits are not generally associated with Chinese culture, some shifts in consumer behavior have prompted the transition. China’s middle-class population is growing, and as incomes rise, more individuals are seeking new flavors and able to upgrade their consumption.
Who are China’s Spirits Drinkers?
The drinking population in China is getting younger. Rather than in the conventional corporate setting, more young individuals are drinking for personal/casual use. They are more daring, seeking out new flavors that suit their palette. Despite the fact that men account for six out of 10 alcohol drinkers in China, the number of female drinkers has been continuously increasing.
Spirits consumption is higher in higher-tier cities than in rural areas and lower-tier cities, where a large number of hypermarkets and supermarkets serve as distribution outlets. Shanghai consumers, for example, consumed approximately 4.85 million liters of whisky in the first quarter of 2017.
The Chinese’s choice of spirits is still influenced by their social position. Spirits are consumed during crucial business meals or as a typical luxury present.
As China’s market gets increasingly flooded with counterfeit alcohols, people have come to prefer international brands over domestic brands in terms of quality and safety.
What are the Best Ways for Foreign Brands to Enter China’s Spirits Market?
Businesses catering to the millennial generation have begun to understand the significance of product packaging. The younger generation is heavily influenced by images. The appearance of the spirits is equally as essential as the spirits themselves. Is it worth spending money on a product that isn’t Instagram-worthy?
Online marketing has become an important aspect of reaching consumers as a result of the digital revolution. The average Chinese person aged 20 to 39 spends three hours every day on the internet. Companies grab their attention by placing online ads and connecting with them on major Chinese social media platforms such as WeChat and Weibo.
Imported spirits firms have a wonderful potential to market their products through an E-commerce platform. In China, 55 percent of alcohol drinkers shop online, where there is a large selection of spirits to pick from and where incentives such as free shipping are frequently used to encourage sales.
Of course, brand recognition continues to be a key factor in the Chinese selection of alcoholic beverages. Consumers are more likely to trust brands that have received positive feedback and recommendations. The Chinese place a premium on authenticity and quality in their spirits, just as they do in other items.
In-store tasting is also a tried and true strategy of increasing brand knowledge and networking by funding local community outreach. These initiatives help potential customers create rapport, awareness, and personal relationships.
Although indigenous spirits continue to dominate China’s spirits sector, the changing consumer landscape is ripe with chances for international brands. Mersol & Luo assists businesses in getting into this niche market by ensuring that branding, strategy, and import plans are tailored to shifting tastes.