Last Updated on August 9, 2024
The continued development of China’s digital ecosystem has made it easier for foreign brands to sell wine, vodka, beer, and other liquor spirits directly to Chinese consumers. These business opportunities mainly stem from the prevalence of social media channels and cross-border e-commerce platforms in the country.
In 2024, China recorded an alcohol consumption rate of 50.9 billion liters per year. This forecast signals the continued development of the market segment in the long run, making more brands eager to enter the local business scene.
In this post, we’ll explore the different sides of China’s alcohol market and discuss the best digital marketing strategies to reach your intended audiences.
How big is the alcohol market in China?
China is currently the largest consumer of alcoholic beverages in the world, with an extensive market that includes beer, spirits, vodka, grape wine, rice wine, and hard seltzer. According to the 2023 reports, the segment stands at a value of $160 billion.
If the alcohol market in China continues at its current consumption level, experts predict it will generate $333 billion in revenue and total sales by the end of 2024.
Compared to other countries, alcohol-fermented beverages have a long history that closely connects them to Chinese culture. Local consumers often use these products in ceremonies, rituals, social events, and business gatherings throughout the country.
An average at-home consumer in the Chinese market consumes at least 28.50 liters annually. With the growing market volume of the alcoholic beverage segment in grocery establishments, virtual storefronts, and convenience stores, the segment’s growth rate could reach 2.27% from 2024 to 2029.
The Changing Demand in the Chinese Wine Market
Despite the slight decrease in wine consumption, China’s wine market remains an important segment for foreign brands who intend to expand their presence globally. With the forecasted revenue of $26.8 billion by the end of 2024, it’s apparent that the industry is experiencing continued local demand.
The Chinese market is the eighth largest consumer of these alcoholic beverages, accounting for 4% of the global wine consumption. Among the product varieties, red wine remains the most sought-after. Meanwhile, sparkling and white wine options are gaining popularity among young alcohol drinkers and female consumers.
Last year, China’s wine market recorded 250 million liters of imported products. Around 48.2% of these beverages are from France, followed by Chile with 19.31%.
Australian wines used to be the top choice of Chinese wine drinkers among imported products. However, seeing the status of wine exports last year, China’s wine market seems to have shifted to drinking wine from French wine brands.
In the wine market, the most well-known companies to Chinese consumers are from Bordeaux, France. Typically, these are red wines made with Merlot and Cabernet Sauvignon.
Continued Business Growth of China’s Spirits Market
Besides wine consumption, Chinese consumers are very keen on drinking alcoholic spirits. This product category includes brandy, distilled liquors, rum, vodka, whisky, and gin. The continued consumption of these beverages is mainly attributed to the prevalence of domestic specialty Baijiu.
Last year, brandy remained the most imported product in China’s spirits market. The demand for this alcoholic beverage has reached an impressive volume of 43.32 million liters. On top of this, Chinese consumers also seem to favor whisky, primarily since it covers over 32.32 million liters of the segment’s overall consumed volume last year.
Although the total sales of domestic products in China outweigh that of foreign brands in this category, globally renowned alcohol manufacturers like Bailey’s and Hennessy still have a solid consumer base in the country.
The dominating Chinese consumers in the local spirits market are from the Millennial age group, aged between 25 and 44 years old. While 59.8% of its customers are male drinkers, it’s worth noting that alcoholic spirits are gaining popularity among female consumers, taking up over 40.2% of the total market share.
How to Effectively Promote Alcoholic Drinks in China
● Localize Your Products and Overall Branding
Compared to other countries, Chinese consumers lean more toward brands that align their offerings with local tastes, cultural nuances, and consumer behaviors. While they’re not particularly against purchasing imported wines or spirits, a localized product makes a brand appear more credible and reliable.
Brand localization might involve creating new flavors or adjusting the alcohol content. For example, many international wine brands have introduced sweeter, low-alcohol products specifically for the Chinese market, which resonates well with local palates.
Absolut Vodka launched an orange peel shot flavor for China (Source: The Drinks Business)
You can also incorporate Chinese cultural elements, like local festivals, events, and holidays, into your branding and digital marketing strategies.
Take the work we did for Leffe as an example. In preparation for the Shanghai Oktoberfest, our team crafted on-brand creative assets to promote the brand in local social media channels.
We created content in Simplified Chinese to reach more Chinese consumers and hosted a ticket giveaway for the event with Leffe beer as part of the freebie.
Example of Localized Branding Strategies (Source: Leffe)
● Launch and Optimize a Chinese Website
As part of brand localization strategies, foreign companies must also take into consideration the power of their company website. Regardless of whether you intend to launch a large-scale promotion or not, the reality is that Chinese consumers value a product’s digital reputation.
When they search for your brand or industry-related terms, they expect to see the most relevant information about your business. If they don’t find that, you’re losing potential sales conversions.
Implementing a successful Baidu SEO strategy was one of the tactics that worked well in favor of foreign companies. It’s also what our team did for Rioja Wine’s localized website, allowing the brand to appear on top of the local search results when a related term is entered.
RIOJAWINE Top 1 search result on Baidu
For a successful brand localization, you can try finding which keywords to use, increasing the likelihood of your site ranking higher, especially for terms and words related to the alcohol market in China.
You can use keyword research tools to help you identify the terms frequently used not only by consumers trying to find wines and spirits but also by local importers who are searching for business partners.
Around 99.1% of Chinese consumers are surfing the internet using mobile phones. This means that consumers in China are more likely to purchase wine on their phones than on computer desktops.
If you want Baidu to consider your site helpful to phone users interested in drinking wines and liquor spirits, your landing pages should be mobile-friendly.
Speed is also among the many factors local search engines consider when ranking content. Because of this, it’s wise to host your website through a China-based server to enhance webpage performance and credibility.
● Boost Visibility on Social Media Channels
Consumers from younger generations, like Chinese Millennials and Gen Z, no longer restrict their options to well-known imported alcohol brands. The rise of social media platforms has made it easier for these consumers to find high-quality products that are not necessarily from the shelves of supermarkets and convenience stores.
In a business landscape as populated as China, social media influencers or KOLs hold the power to sway their followers’ purchasing decisions. They often create engaging content that resonates with their audience, driving awareness and interest in the brand they want to promote.
KOLs featuring Moutai on their social media content
Beyond typical social media posting, releasing fun, creative, and engaging video content that showcases your products can capture the attention of your target consumers. The premium baijiu brand Moutai has leveraged Douyin to create viral content, thereby increasing its appeal among younger audiences.
Foreign brands can also participate in challenges and trends for a chance to go viral. This approach encourages user-generated content, amplifying your business reach and local visibility.
● Explore Paid Digital Advertising Options
Promoting alcoholic drinks in China can be very successful with the right digital advertising strategies. However, understanding your audience is crucial if you’re considering this method.
Brands like Budweiser use data to target their ads to specific groups. By knowing who is most likely to buy their products, they can make sure the right people see their ads. This makes their advertising more effective and ensures they get the best return on their investment.
● Sell Through Cross-Border E-Commerce Platforms
Bringing new alcoholic drinks into the Chinese market has become much simpler. Thanks to the rise of cross-border e-commerce (CBEC) platforms, foreign brands can now sell their products without needing a physical store in China.
The Chinese government has been very supportive of the CBEC industry. They’ve introduced helpful policies like creating pilot zones and simplifying the local entry process.
Sales channels like Tmall, JD.com, and WeChat Store & Mini-Programs are key players in this space. These e-commerce platforms allow brands to set up virtual storefronts where consumers can browse and buy products directly. These platforms also offer various advertising options to help brands target specific audience groups effectively.
Example of our Client’s WeChat E-Commerce Mini-Program
● Boost Reputation in Local Forums
In recent years, Chinese consumers have come to put more value on user-generated content. Local internet users rely on these recommendations mainly because they offer authentic feedback from their fellow customers or include expert advice from industry leaders and professionals.
You can find these content types on local forums like Zhihu (知乎) and Baidu Tieba. Like Quora, articles and answers posted on these platforms are seen as authentic and credible.
Responding to feedback and questions on these forums is crucial to bolster the relationship between brand and consumer.
A verified Zhihu account of a local craft beer brand
With a verified brand account, marketers can engage with other forum users to answer queries about their products or other market-related concerns requiring expert opinions. Remember that these platforms specifically focus on user-generated content, so we advise you to minimize any hard-sell advertising approach.
Notable Trends in China’s Alcoholic Beverages Market
1. The Growing Demand For Low-Alcohol Beverages
Unlike their predecessors, young people in China are less enthusiastic about classic alcoholic drinks. The extensive effect of wellness trends within the country has made this consumer group favor healthier options like wine from fermented grapes or other fruits and beverages with lower alcohol content.
Prices are also a significant factor in this growing trend, primarily because beverages with low-alcohol levels are often more affordable than vodka and other liquor spirits.
Fruit wines displayed in a local supermarket (Source: China Daily)
Moreover, younger consumers prefer beverages that allow them to maintain social and professional appearances while indulging in alcoholic drinks.
They often seek unique flavors, innovative packaging, and brands that resonate with their lifestyle and values. Low-alcohol beverages fit well within this niche, balancing enjoyment and moderation.
2. The Popularity of Small-size Alcohol Bottle Designs
The Chinese alcohol market has seen a notable trend towards the popularity of small-size bottle designs. This trend is mainly driven by consumers’ growing preference for convenience and moderation.
It’s particularly evident in the wine and spirits market, where producers capitalize on the demand for more manageable portions.
These smaller bottles cater to individuals who want to enjoy their favorite drinks without the commitment of a full-sized bottle. This makes them ideal for single servings, small gatherings, or for those looking to try different varieties without excess.
Source: Thirst Mag
Packaging also plays a crucial role in attracting consumers in crowded alcohol markets. Eye-catching labels and unique designs are essential for differentiating products on store shelves.
Many brands are even investing in sustainable packaging solutions to appeal to a modern, environmentally conscious consumer base.
3. Traditional Retail vs Online Sales
Historically, traditional retail outlets such as hypermarkets and supermarkets dominated the distribution of alcohol, including wine and spirits.
These physical stores provided domestic consumers the tangible experience of browsing and selecting products, often accompanied by promotions and in-store tastings.
The on-trade channel, which includes bars, restaurants, and clubs, has also been a significant player in alcohol sales. These venues not only serve as points of consumption but also influence brand perception and consumer preferences through curated experiences and social drinking occasions.
Source: China Daily
However, the rise of digital technology and the increasing comfort of consumers with online shopping have dramatically reshaped the market.
This shift is driven by the convenience of online shopping, a wider variety of available products, competitive pricing, and home delivery services, particularly appealing to younger, tech-savvy consumers.
Quick Q&A
Can you export wine to China?
Yes, you can export wine to China even as a foreign business entity. You can find a local importing company or enter through other distribution channels. After that, try to work with a digital marketing agency with enough industry experience in the wine market in China to enhance your brand reputation and visibility.
What is the most sold alcohol in China?
The most sold alcohol in China is still Baijiu. However, beer and other liquor spirits are also popular among locals. The vodka market, in particular, has increasingly opened its doors to foreign brands, garnering imports from 40 countries.
Who are alcohol consumers in China?
Alcohol consumers in China span diverse demographics, with notable segments including young, urban professionals and middle-aged individuals who value premium and imported brands.
Younger consumers, particularly those in major cities, are driving trends with their preference for convenience and digital shopping. Meanwhile, traditional consumers continue to favor established, domestic products like baijiu.
Ready To Dominate The Chinese Alcohol Market? Get In Touch With Us Today!
The Chinese alcohol market may seem lucrative, but the reality is you need extensive knowledge to thrive in this business scene. At Sekkei Digital Group, we understand the subtleties inherent to the industry, including consumer behaviors and the ever-evolving trends that shape it.
You may also want to read:
With our team’s extensive industry experience and expertise in this niche, we offer you the avenue to unlock your brand’s potential and secure a formidable position as a leading entity.
If you are a Wine and Spirits professional and need more info about how to enter the Chinese Market or take your already established brand to the next level, send us an inquiry. We’ll gladly look into it and schedule a meeting with one of our expert consultants.
References:
Volume of spirits imports to China in 2023 by type
Wine Market in China: Trends, Growth, and Consumer Preferences