China – Where Politicians Are the Trendsetters

What do Panda cigarettes, Moutai rice alcohol, Louis XIII cognac and Chateau Lafitte have in common ? They are all old brands characterized by a continued presence in China, predating the creation of the Communist State in 1949, and still alive today.

Take Panda cigarettes. Today, they are the most expensive cigarettes on the market, at 13 euro a pack, in a country where you can buy cigarettes for 40 cents a pack. A huge price difference which cannot be justified by superior tobacco quality – as would be Cuban cigars compared to cigarettes. No such attributes, no special premium packaging. In fact, they are just the cigarettes that Chairman Mao smoked – along with the whole of the Party, government and still today the officials. They are a luxury product born from adoption by the political system, and whose price is only reflective of its power as a status symbol. But not just any status – the status linked to the members of the Founding Party, who are at the helm of the country, a “super elite” or better yet, the new Chinese aristocracy.

Now, let’s take a closer look at Moutai. Kwechow Moutai is a brand which was created at the turn of last century by Chinese entrepreneurs, who unified the various breweries of a single Moutai village, irrigated by a river whose water and mud constituted a perfect breeding groung for Sorgho alcohol. As early as 1949, Moutai understood the stakes and lobbied to be the alcohol of choice for the festivities at the creation of the People’s Republic of China. From then on, not only was Moutai consumed by the politicians, but it also became the gift of choice at official gatherings. It reached the pinnacle of glory in 1974 when Richard Nixon came to China, tasted Moutai and received a superb cristal bottle from the hands of Chairman Mao. A photo was taken which was seen around China and around the world. Moutai became the symbol of the people’s nation of China, and its visibility continues to grow on a domestic level. In a recent auction, a 60 year old bottle of Moutai was sold for a record 180,000 euro, demonstrating that Moutai is not only one of the most popular alcohols in the world, but also, now, one of the most expensive.

When it comes to Louis XIII and Chateau Lafitte, they maintained their distribution in China after the Revolution – through the “foreign currency – only” stores, and were consumed by the elite of the times, meaning the better tables of government and the senior members of the Party. The Chinese have always been aware of the quality of these two brands and despite occasional mixing with green tea, ginger or other ingredients, there is no need to reinforce the symbolic value of these two names. What supports the success of a Louis XIII or a Chateau Lafitte is quite simply 100 years of uninterrupted drinking by Chinese officials.

It would be interesting for other brands, particularly Chinese, to benefit from the same type of backing. This could provide a significant boost. After all, we’ve heard of Michelle Obama’s tailor, why shouldn’t there be recognised designers for the wives of Chinese officials ? This would promote both the  specific brand and the perception of China, more particularly of “made in China”. These days, every month sees the emergence of new fashion designers. As with alcohol, there could be a “politically correct” way to dress, which would put the spotlight on the majors designers in Chinese fashion.