What do you get when a 2,000 year old liquor teams up with a 7 year old coffee company?
Well, a whole lot of money for one.
The concept of mixing coffee and alcohol is new to China where Western staples like Bailey's Irish Coffee has never really taken off.
China is traditionally a tea drinking culture and the idea of morning coffee is not popular.
However over the past decade new coffee brands have been skyrocketing and creating a distinct Chinese coffee culture.
Coffee in China is typically an out-of-home purchase, particularly favored by the middle class. It has become intrinsically linked with modern urban life in China, taking on new cultural meanings related to status, lifestyle, aesthetics, urban communities, and the acquisition of new tastes. Millennials and Gen Z are at the forefront of shaping China’s coffee culture.
Shanghai alone has over 7,000 independent coffee houses surpassing that of even New York.
This has led to intense competition between the new brands looking to gain more of the market share of this ready-to-spend demographic.
The Collaboration that Broke the Internet
While places like 7-11 had launched an offering to add a shot of various liquor to coffee in 2022, in 2023 the popular coffee brand launched a collaboration with famous baijiu company Maotai.
For the uninitiated Maotai is a type of baijiu.
Baijiu is a colorless distilled liquor that could be compared to things like sake or soju, but much stronger.
Japanese sake typically has an alcohol content of 15% and Korean soju averages 20% ABV.
Chinese baijiu ranges from 35-60% and is traditionally associated with the older generation.
Luckin launched the drink on Monday for 38 yuan ($5.20) under the name “酱香拿铁” (jiàng xiāng ná tiě) or “Sauce-Flavored Latte,” soon selling out at various stores and becoming a trending topic online. The ‘sauce’ reference is because of the distinct flavor profile associated with Maotai, often described as having a soy sauce-like aroma (“酱香型”).
It became an instant hit for a couple of reasons, the biggest being the instant name recognition of each brand.
The first day of sale reported 5.42 million cups sold.
Luckin Coffee is particularly popular in the younger generation often referred to as the "Chinese Starbucks" for its high quality offerings, affordable prices, and the many many convenient locations.
Maotai, made in Maotai in Guizhou Province, prides itself for its 2000-year history and it became the first Chinese liquor to be produced in large-scale production. The strong luxury spirit (53%), known as China’s national liquor, is especially popular among middle-aged and elderly men and is very associated with business and government dinners.
Because of this many said "For young people, it’s their first cup of Maotai, for the elderly, it’s their first cup of Luckin.”
This unlikely combination drove demand in part out of sheer curiosity of how it would taste.
The combination of coffee and alcohol focuses primarily on flavor rather than a strong buzz, as the Luckin coffee infused with baijiu contains only around 0.5% alcohol.
Although the initial shock to the market of the collaboration is over, many other beverage companies are looking to replicate the mass sales formula of adding alcohol to their drinks.
Milk tea and others are now rolling out similar offerings, we'll see if the coffee + booze idea takes hold in China at large in the future.
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