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World's 7th Spirit Champions and Top 100 Liquors Released
TNC ONLINE   2019-09-06 19:26:02 Author:TNCR Source: Font size:[Large][Middle][Small]

China National Association for Liquor and Spirits Circulation and China Brand Strategy Research Institute jointly released the 2nd World's Top 100 Liquor Brands Value Research Report at the China National Convention Center in Beijing on August 28, 2019.

1. The world's 7th spirit champions

It is well known that spirits are high-concentration liquor and also called distilled liquor. According to the International Wine & Spirits Research (IWSR), the breakdown of spirits is as follows: transparent spirits (vodka, and rum, etc.) accounting for 43%, whisky accounting for 34%, liqueur accounting for 8%, brandy and cognac accounting for 7%, bitters accounting for 6%, and anisette accounting for 2%. Apparently, they forgot to include China's white spirits (Baijiu) therein. With Baijiu, there are seven categories of spirits, and the seven champions are separately:

Category

NO.1 brand

Enterprise

Brand value/RMB100 million

Baijiu

Moutai

China Kweichow Moutai Distillery (Group) Co., Ltd.

2179.91

Vodka

Smirnoff

Diageo plc

1861.92

Whisky

Johnnie Walker

Diageo plc

1347.80

Brandy

Emperador

Alliance Global Inc.

763.41

Liqueur

Baileys

Diageo plc

280.86

Anisette

Ricard

Pernod Ricard SA

168.90

Bitters

Jägermeister

Mast-Jägermeister SE

168.32

2. The method to calculate

The interactions between Chinese and foreign drinking friends become more frequent with the deepening of international exchanges, and so does the circulation of Chinese and foreign famous liquors. Despite their fine quality, liquors have never been ranked, which virtually increases consumers' choice cost. And with the globalization today, it is even more troubling when it comes to what fine liquors are there in each country. As such, the Organizing Committee has released the list of World's Top 100 Liquor Brands to make Chinese and foreign drinking clear about the rankings of both Baijiu and foreign liquors among global liquors and provide a reference for everyone.

Mr. Gang Chen, Secretary-General of the World's Liquor Brand Value Evaluation Organizing Committee, detailed the evaluation method: V=(P1+P2) * F*S, where, V is brand value, P1+P2 is supernormal profit, F is brand strength, and S is brand status, namely, the brand value evaluates intangible assets of liquors mainly from 3 aspects: economic indicators (including revenue and profits, etc.), brand strength (including enterprise nature, industry nature, leadership, stability, internationalism, and development tendency), and brand status (including brand positioning, brand architecture, brand communication, and brand management). In particular, it should be noted that unlike the list of top 200 Chinese liquor brands by value that calculates the value of enterprise brands, the list of world's top 100 liquor brands calculates the value of single product brands.

3. Why Diageo?

Possessing three among the world's seven spirits champions, Diageo is the group with the largest number of spirits champions, which conjures up the Chinese table tennis team. Diageo is a famous spirits group in the UK. It is among the Global 500 and is the world's largest foreign liquor (relative to Chinese liquors) company, with a range of top liquor brands involving distilled liquor, wine, and beer, etc.  A company similar to Diageo is Pernod Ricard. Let's see the renowned brands under them below.

 

Firm

Category

Product

Brand value (RMB100 million)

Firm

Category

Product

Brand value (RMB million)

Brands under Diageo

Vodka

Smirnoff

1861.92

Brands under Pernod Ricard

Indian whisky

Bols Blue

909.38

Whisky

Johnnie Walker

1347.8

Indian whisky

Royal Stag

858.63

Indian whisky

McDowell's

888.93

Vodka

Absolut Vodka

570.04

Rum

Captain Morgan

782.21

Whisky

Ballantine's

407.16

Whisky

Crown Royal

393.64

Whisky

Jameson

315.24

Gin

Gordon's

357.64

Whisky

Chivas

274.29

Rum

McDowell's No.1

329.03

Rum

Havana Club

248.61

Liqueur

Baileys Irish Cream

280.86

Indian whisky

Blenders Pride

184.65

Indian whisky

Old Tavern

260.6

Anisette

Ricard

168.9

Indian whisky

Haywards Fine

237.46

Liqueur

Malibu

155.52

Gin

Tanqueray

220.08

 

 

 

 

Cachaca

Ypioca

127.55

 

 

 

 

Among the released list of the world's top 100 liquor brands, Diageo has 12 brands and Pernod Ricard has 10 brands, with the total brand value of products of the two companies reaching RMB1.118014 trillion, accounting for about 42.41% of the total brand value of all foreign liquor brands (RMB2.636165 trillion).

4. The best Vodka

As a national liquor of Russia like Moutai of China, there are many brands of vodka with a long history, which makes almost all Chinese people believe that Russia's vodka brands must come out top. However, Russia, the traditional core producing area and largest market of vodka, has only Five Lakes Vodka and Stolichnaya listed among the list of world's top 100 liquor brands, and their brand value and rankings are low, much lower than the British vodka. We can see from the list of world's top 100 liquor brands by value that the brand value of a bottle of British Smirnoff vodka is amount to that of 13 bottles of Russian Five Lakes vodka.

Country

Category

Brand

Enterprise

Brand value/RMB million

UK

Vodka

Smirnoff

Diageo plc

1861.92

France

Vodka

Absolut Vodka

Pernod Ricard SA

570.04

Ukraine

Vodka

Hlebnyi Dar

Bayadera

316.24

Poland

Vodka

Zubrowka

Roust

182.2

Ukraine

Vodka

Khortytsa

Global Spirits

178.27

India

Vodka

Magic Moments

Radico Khaitan

168.13

Ukraine

Vodka

Nemiroff

Nemiroff

147.55

Russia

Vodka

Five Lakes Vodka

Alcohol Siberian Group

140.74

U.S.

Vodka

Svedka

Constellation Brands

134.94

Russia

Vodka

Stolichnaya

SPI Group

125.52

Poland

Vodka

Soplica

Roust

123.92

5. A battle between Chinese and U.S. liquor industries

Chinese brands are far ahead of U.S. brands among the world's top 100 liquor brands no matter in terms of the number selected or total brand value.

 

China

U.S.

Number selected

29

6

Total brand value/RMB100 million

 13119.29 

 2985.03

The excellent performance of Baijiu has contributed to the Chinese liquors' thoroughly defeating the U.S. liquors. There are mainly three reasons: firstly, there is a large base of drinking population in China, with huge consumption and market space; secondly, among the Chinese liquor companies, Moutai has become the liquor company with the highest market capitalization in the world; thirdly, consumers favor more high-end and better Baijiu with the consumption upgrade of the Chinese society, which has indirectly increased enterprise profits. Imported liquors account for a large share in the U.S. market, while, the long history and culture have contributed to the absolute dominance of Baijiu in the Chinese market. As a result, the cultivated own-brands vary greatly in the two markets.

6. Why Baijiu cannot be sold well over the world?  

The brand value of China's Kweichow Moutai ranks 1st among the world's famous liquors, however, European spirits still have a monopoly position in the international market. From the perspective of the market capitalization of listed companies, Moutai and Wuliangye have overwhelming advantages, but they have a very large gap with European spirits in terms of global influence, overseas income, and overseas profits. The following chart shows a comparison between the market capitalization of Chinese and foreign spirits companies (by Aug. 16, 2019, in RMB100 million)  

According to the relevant data statistics of the WHO, China is the largest distilled liquor producer and consumer in the world, with the annual average production accounting for about 30% of the total distilled liquor production in the world and consumption accounting for about 28.5% of the total distilled liquor sales in the world. However, the international market share of the British whisky is the highest, to reach 30.25% among famous liquors in the world; French brandy ranks 2nd, to reach a market share of about 11.5%-13% in the world; while, Baijiu only account for 0.76%. Take Pernod Ricard for instance, the overseas income of this French company exceeds 90% of its total income; by contrast, almost 95% of the income of Baijiu enterprises is achieved in the domestic market.

A Comparison of Revenue of Moutai and Pernod Ricard in 2018 (RMB100 million)

Moutai

Region

Revenue

Pernod Ricard

Region

Revenue

America

198.59

Domestic

706.72

Europe

217.78

Overseas

28.93

Asia and others

284.54

Chinese distilleries need to tell the world when should Baijiu be drunk.

For more information, please click here Spirit campany ranking 2019.pdf


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