According to the statistics, at least 13 low-alcohol brands have secured financing since 2020. MissBerry, Malidundun, and Lady Penguin have been the favorites. At the same time, Fu Bixing, an upstream supply chain service platform for low-alcohol drinks, has completed 3 rounds of financing within 4 months.
Due to the epidemic restrictions, people in China started drinking at home. The global alcohol category has declined since last year, while low-alcohol drinks achieved an average sales growth of 15% – from the emergence of domestic fruit wine in 2000 to the rapid expansion of the premixed wine represented by RIO from 2012 to 2014. However, the over-optimistic demand for premixed wine by RIO at that time led to overstocking of inventory, and declining market sales. In the past, Rio’s pre-mixed wine was focusing on enjoying the drinks socially, while currently more consumption scenarios have been added to low-alcohol drinks, with an expected growth rate of 20%.
The generation born in the 1990s and 1995s has started entering the age of drinking. The post-90s generation is no longer willing to follow the alcohol culture of their elders, and they are more willing to pursue self-enjoyment to meet the needs of non-social interaction and relaxation. Additionally, with the continuous improvement of women’s economic status and change in their mindset, young women have become the main consumer group of low-alcohol, accounting for nearly 70% of the consumers.
The market size of low alcohol in China is about 15 billion to 20 billion RMB (US$2.3-US$3.1 billion), accounting for only 3% of the beer market, compared with Japan, where the low alcohol market is relatively mature with a 30% market share. If the low alcohol market can reach 10%-15% of the beer market, it will be a business of a hundred billion RMB (around US$15.0).
Now the whole low-alcohol market is under self-education process; even several new tea brands are adding alcohol to their products. 10 years ago, people thought that low alcohol was only for pre-mixed cocktails, but now we can see that there are fruit wine products, soda, rice wine, and many new categories, which are constantly ‘educating’ the consumers. We have previously shared a post about a new Chinese low-alcohol drink.
As 70% of low-alcohol drinks are purchased by women, MissBerry is highly focused on this target group. The brand wants to be the leading brand in the female alcohol segment. As an emerging brand, MissBerry chose to start selling online to verify the market’s acceptance of new products and new flavors. Nowadays, female purchasing power is on the rise, as well as their alcohol consumption. In our previous news, we have mentioned that Alcohol consumption among women in China was on the rise and we also published an article about the Low alcohol revolution in China. MissBerry has captured this new segment! Apart from online channels, 40% of MissBerry’s sales come from offline channels. At present, the brand has covered 10,000 outlets nationwide, including supermarkets, such as Metro, Tesco, convenience stores, such as 7-11, Lawson and FamilyMart, and new retail channels such as Hema Fresh, and 7fresh. The number of outlets is expected to approach 30,000 by the end of this year.
“The best growth path for low alcohol drinks must be e-commerce first, then convenience store channel, supermarket channel, and then traditional catering channel”, said Ms. Tang Huimin, the founder of MissBerry. The current low-alcohol brands have not reached the dining tables yet, which means there is a huge space for growth. The catering segment means a bigger scenario for low-alcohol drinks in China.