How the founders of Ming River Baijiu are attempting to launch an entirely new alcohol category in the United States. Dang: I guess the whole concept was kind of a genius marketing idea in itself. Now, Capital Spirits was reaching a demographic they had never really hit before: foreigners and younger Chinese. Describe the challenge of not only launching a spirit brand into America's crowded market, but specifically of launching an entirely new category. We had to spend a lot of time and money on education at the same time while trying to promote a brand. Ming River and baijiu, in general, is not yet at the point where it sells itself, even in the most receptive/cosmopolitan markets in the U.S., and our team is still quite small. So far, we’re seeing pretty good adoption by the millennials, but we’re going to try to go after other demographics as well. Sandhaus: Because we are in such unchartered waters, we’ve made a lot of assumptions that were challenged immediately. So, there’s not a right answer to who the target market is for this product yet. So, we’ve right away adapted and started doing a lot more Chinese American-focused events.
How the founders of Ming River Baijiu are attempting to launch an entirely new alcohol category in the United States.
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Unless you’ve been to China, it is quite likely you’ve never heard of baijiu. But even if you have, and found yourself consummating a new business partnership with shots of the pungent clear spirit — cheering over heaping plates of pork, chilies and noodles — chances are you’re still unaware that grain-based baijiu is the most consumed alcohol on planet Earth.
That’s because even though four billion gallons of baijiu are sold annually, more than twice the volume of vodka, almost none of that ocean of distillate reaches American shores. Ming River Baijiu aims to change that. In a partnership with one of the largest and oldest distilleries in China, Luzhou Laojiao, the four founders of Ming River aim to not only introduce another bottle to the crowded spirit marketplace but also introduce an entirely new category to the American consumer. It’s a daunting challenge indeed.
Adding to the difficulty is the history and breadth of the spirit (baijiu translates generically to white alcohol), encompassing numerous regional styles. Dating back to the Ming Dynasty, at least a dozen varietals, or aromas, of baijiu have developed throughout China. Four major pillars (sauce-aroma, rice-aroma, strong-aroma and light-aroma) account for more than 95% of sales volume, however. Strong aroma, the Sichuan-based variety that Ming River produces, is the most popular.
All of which makes the challenge facing Global Marketing Director Simon Dang, Educational Director Derek Sandhaus and CEO Bill Isler even greater. The colleagues started their endeavor in 2014 by opening Beijing’s first baijiu-focused bar, Capital Spirits, inspired after Dang and Isler attended a discussion of Sandhaus’s book, Baijiu: The Essential Guide to Chinese Spirits. Capital Spirits was an unexpected success; it attracted a throng of young Chinese and expats, two coveted demographics. Western media noticed, and China’s largest baijiu distillers were not far behind.
How did the success of the Capital Spirits evolve into the Luzhou Laojiao distillery approaching your team for a partnership?
Dang: I guess the whole concept was kind of a genius marketing idea in itself. People had this preconceived idea about baijiu, so you can just imagine someone saying, “Hey, I went to this baijiu bar the other night.” The other person goes, “No way. You’re absolutely crazy.” Then they come back and say, “Actually, it was pretty cool.” Then word spreads. Also, during that time, Chinese President Xi…