China can be proud of its bai jiu but it will be a while before the world gets hooked on

How bai jiu can become a global liquor brand has been a topic played out constantly in the minds of Chinese liquor brand owners.

CHINESE people, proud of their hometowns, often express their regional pride by lavishing praise on certain local specialty.

Bai jiu, or Chinese-style spirits, is a typical specialty. Almost every region has its own iconic bai jiu and distilleries, so much so that some obscure localities are known primarily for their bai jiu.

For example, Guizhou is known for Moutai; Yibin, a small city in Sichuan Province, is famous for the Wuliangye distillery; Shanxi is noted for Fen Jiu — named after Fen River; and Suqian, a city in Jiangsu, is the birthplace of the Yang He brand. The list goes on.

Abroad, bai jiu does represent a slice of the Chinese cultural heritage but somehow it is not nearly so voraciously consumed as in China.

How bai jiu can become a global liquor brand has been a topic played out constantly in the minds of Chinese liquor brand owners. It was a topic that was explored at the recent 2017 China Alcoholic Drinks Fair held in Shanghai.

At a forum, Zhang Chonghe, head of the China Light Industry Council, extolled the role liquor played in representing the country abroad. He observed that “brandy is what makes French cognac famous, whisky is a world-famous specialty of Scotland, vodka has done Russia proud and rum reflects positively on the national psyche of Puerto Rico.”

He added that the same can be said of bai jiu. So far, established bai jiu distilleries number about 1,500 nationwide with an annual output of 13.5 million tons as well as a yearly profit of 80 billion yuan (US$12 billion).

Especially noteworthy was his remark that Chinese exports of bai jiu this year totaled 16,000 kiloliters, generating US$468 million in revenues.

Despite the volume of exports, the fact is that Chinese bai jiu hardly stands out among competitors in the world.

Ji Keliang, a guest speaker, said that bai jiu has a long way to go before it acquires the same recognition as whisky, vodka, tequila and other spirits.

As the honorary president of Moutai who helped build it into a business empire with a market capitalization of 500 billion yuan, Ji acknowledged that there are problems in bai jiu’s quest to woo foreign drinkers.

Even for heavy drinkers, it will take time for them to get used to the somewhat pungent taste of bai jiu. Bai jiu companies simply have to invest more in getting to know their customers — the first step in targeting a global audience.

Ji said that the craftsmanship that goes into the production of bai jiu could help promote the category.

“Due to China’s status as the world’s second-largest economy and its rich, splendid heritage of liquor,” it was high time that bai jiu went global, he said.

According to many observers, the main reason why bai jiu has struggled overseas is because of its relatively high alcohol content, usually over 100 proof, while most foreign spirits are milder in ABV (alcohol by volume), somewhere between 80 and 90. Higher alcohol content could be intimidating to health-conscious drinkers.

Bai jiu’s lack of variety also inhibits its popularity. There is not a single widely accepted cocktail in the world that blends bai jiu with other beverages that speaks volumes about why bai jiu is hard to find in cocktail bars and nightclubs.

Indulging in his self-congratulatory mood, Ji, however, did mention that bai jiu brand owners have to remove a few hurdles to gain global competitiveness. Among them are management issues, outdated marketing strategy and ignorance of the huge chasm between foreign and local drinking cultures.

He didn’t elaborate on what keeps bai jiu off the wish list of foreign drinkers.

Talk of global ambitions may be a little premature when many distilleries are unsettled by the distaste of young domestic drinkers for bai jiu — exactly the group who will one day become their target customers.

It often takes a few young, audacious minds to push the envelope. In fact, a handful of indigenous bai jiu brands have shot to fame on the strength of better package design, keen awareness of consumer preferences, smart marketing skills and better use of social media tools. The sensational rise of Jiangxiaobai, a Chongqing-based distillery, is a case in point. For example, instead of airing commercials worth millions with the national broadcaster CCTV, Jiangxiaobai spends relatively little on traditional advertisements. Their marketing is done mostly via social media tools.

But the success of Jiangxiaobai is hard to replicate, at least by those traditional bai jiu businesses that are perhaps burdened with a glorious past and the ambivalence about disruptive innovation in the Internet age.

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