Kweichow Moutai remains China’s most valuable brand | WARC | The Feed
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Kweichow Moutai remains China’s most valuable brand
Once again, the iconic baijiu-maker Kweichow Moutai sits ahead of the country’s famous tech sector to remain China’s most valuable brand for the fifth year running, according to the Hurun rankings.
Why it matters
The brand’s heritage is deeply tied to the history of Modern China. Moutai (pre-merger) was served at the founding of the People’s Republic of China in 1949. In 1972, Premier Zhou Enlai served it to visiting US President Richard Nixon.
But since the premiership of Xi Jinping, and a high-profile crackdown on graft, the brand’s customer base of military and bureaucratic elites melted away to be replaced by the rising middle class; in 2019, it began some advertising activity. Meanwhile, the category enjoys prominent features during some of the country’s most widely watched events.
Of course, there are historic brands that have made a huge success of their history – see Guinness – while there are also brands with a rich history that have not. Meanwhile, in a difficult 2022 which saw the top 300 brands’ value drop by 14%, Kweichow Moutai has grown its value.
What’s going on
The South China Morning Post reports the rankings, noting the strength of consumer brands over tech companies in a league table based on a combination of financial and market performance and price-to-earnings ratios.
Its brand value, according to the ranking, stands at over 1 trillion yuan ($154.5 billion).
Last year, the company took the innovative step of expanding its product portfolio to a series of ice creams aimed at younger consumers. “For those who are not very familiar with the spirit, the ice cream can satisfy their curiosity about the taste of Moutai in a comfortable way,” said Dai Shijin, an alcohol industry analyst speaking about the news to China Daily.
However, there are some deeper macro issues within this and other baijiu brands, given the pandemic-era glut that has built up for distributors that threatens pricing.
Meanwhile, deeper troubles in the housing market and its knock-on effect on the Chinese economy could dampen demand for a tipple that was once an important part of business culture.
Sourced from South China Morning Post, WARC, China Daily, Financial Times
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