Why did Maotai, which aims to attract young people, turn around to attract pets?

Ask AI · Can insect-protein pet food help Moutai attract younger consumers?

In recent days, Moutai Group’s transformation once again has drawn market attention. Its subsidiary, the circular-economy investment and industrial company, is quietly building an entirely new line of business—insect-protein pet food. Simply put, it means turning the sauce-aroma liquor spent grain left over after distillation into high-protein pet food by raising a kind of insect called the black soldier fly.

The black soldier fly is a saprophagous insect in the family Stratiomyidae? of the order Diptera, genus Hermetia, native to the Americas, and found in places in China including Guizhou, Guangxi, Guangdong, Shanghai, Yunnan, Hunan, Hubei, and more. Black soldier flies have effects such as inhibiting thrombin coagulation, anti-inflammation, and pain relief. In particular, they contain abundant antibacterial substances, with significant value for medical and health-related applications. Animals fed with black soldier flies can strengthen their constitution, improve immunity, and reduce disease. In October 2013, the United Nations FAO released the “Edible Insects Report,” promoting the use of insects worldwide as a substitute source for livestock and poultry protein feed, and the black soldier fly is one of the insect species with broad application prospects. In 2025, the Ministry of Agriculture and Rural Affairs officially included the black soldier fly in the “Feed Ingredient Catalogue,” clarifying that it can be used as a protein feed resource in feed production and animal husbandry.

From insects to premium sauce-aroma pet food that consumers can accept, this step by Moutai may represent a disruptive change for the entire pet industry. Some netizens commented: “I eat starch sausages; it eats sauce-aroma food” and “I haven’t had my first drink of Moutai yet, but the dog has already had Moutai.” … Judging from the capital market’s reaction, this “cross-industry move” has not boosted the stock price. From March 18 to March 24, the stock even saw a five-day losing streak.

Why is Moutai targeting the pet segment?

Moutai’s move is actually very straightforward. It has already launched a pilot (trial-production) project together with its partner. The project can process 5 tons of liquor spent grain per day, producing nearly 1 ton of fresh insect biomass. This move not only addresses the disposal problem of liquor distillation byproducts, but also catches a new trend that people around the world are paying attention to—insect-protein pet food. Moutai’s liquor-spent grain is used to raise insects, with a goal to “strive to bring insect-protein pet food to market within the year.” As a superpower with a market value in the trillions, Moutai’s actions directly ignited a frenzy in both the liquor circle and the pet circle. “A capital giant has entered the pet segment; the industry is going to be reshuffled,” some said. A pet parent also joked, “Does the cat food count as drunk driving if it’s from alcohol?” and “Sauce-aroma technology finally goes after cats and dogs…” No matter what, Moutai has already successfully attracted a wave of attention.

The pet segment Moutai is eyeing is not a niche market—it is a massive track with a market scale of several thousand billions (hundreds of billions of RMB). Public information shows that in 2025, the urban pet (dogs and cats) consumption market size reached 312.6 billion RMB, up 4.1% year over year. Among that, pet food holds the first-largest sub-segment with a 53.7% share; when converted, the market size is about 120 billion RMB. It is expected that by 2028, the market size will exceed 405 billion RMB, with a CAGR staying at 8–10%. By then, the market size of pet food will exceed 200 billion RMB.

With such a huge market size, how much market share can Moutai capture? Based on the data Moutai has officially released so far: the pilot project is designed to handle 5 tons of quality sauce-aroma liquor spent grain per day, producing 0.9 tons of fresh black soldier fly larvae per day. Rounding and estimating at 1 ton, and assuming the fresh-larvae powder yield rate is about 25%, if 1 ton of fresh larvae is dried into insect powder to be used as an ingredient in pet food, the output would be only about 250 kilograms. Even if Moutai increases its capacity tenfold, it would still be under 3 tons.

At present, the wholesale price of black soldier fly insect powder in the pet market is about 8,500 to 11,200 RMB per ton. With a daily output value of less than 3,000 RMB, even if production value increased by 100 times, and even if it were branded with a sauce-aroma gimmick, with the unit price doubled, for Moutai—which had revenue of 174.1 billion RMB in 2024—that would still be just a rounding error. In 2024, Moutai’s daily revenue was 476 million RMB. In the first three quarters of 2025, revenue was 130.9 billion RMB, averaging daily revenue of 479 million RMB. For Moutai, which brings in only about 500 million RMB per day, the output value of black soldier fly insect powder is practically negligible.

Meanwhile, in front of major domestic pet food OEMs that can put out hundreds of tons per day, this capacity is not even a rounding error. In today’s domestic C-end market, insect protein is still only a niche category. The cost of educating the market upfront on the nutritional value of black soldier flies and how to get pet parents to buy “sauce-aroma food” at high prices may not be low.

The intent of the drunkard isn’t “for cats and dogs”?

So it seems Moutai’s intent may not be only for cats and dogs—or for young people who like raising pets. It can also solve its own logistics and support issues. Moutai produces over 4 million tons (40+ million tons?) of sauce-aroma liquor spent grain each year. Traditional handling comes with a double burden. Environmental pressure: liquor spent grain has high acidity, spoils easily, and has high processing costs, with also risks of pollution, creating certain environmental pressure. Selling the spent grain can also lead to secondary extraction of alcohol and the blending of counterfeit liquor, threatening the brand’s foundational roots and forming a hidden risk for the brand. In addition, low-price exports and waste hauling deliver low added value. Using it to raise insects and make sauce-aroma pet food is a more reasonable use of its own resources, with added value greater than selling it externally.

Public information shows that there are more than 90 million pet owners born in the 1990s and 2000s. If we also count pet parents born in the 1980s, the number of young people who keep pets is far beyond 100 million. Previously, Moutai’s cross-industry marketing such as sauce-aroma coffee and ice cream was also aimed at attracting young people and addressing the problem that young people don’t like to drink baijiu.

Pet owners are mainly younger in demographics. The sum of post-1990s and post-2000s is close to two-thirds, making them the absolute consumption backbone of the pet market. In 2025, the post-2000s share reached 26.3%, clearly up from 25.6% in 2024, becoming the fastest-growing group. Especially after the rise of post-2000s, purchasing power increased significantly, and high spending has shown a concentration trend. Among high-spending pet owners, post-1990s account for 50.1% and post-2000s for 27.3%, totaling nearly 80%. Moreover, demand from post-2000s is growing rapidly, and the proportion will keep increasing.

These young pet keepers are Moutai’s ultimate target. After the Spring Festival, iMoutai released a set of survey data: the 31–40 age group accounts for 45.0%, the 25–30 group accounts for 12.2%, and young people below 40 have already become a new force in Moutai’s consumption. The survey has also been questioned as inaccurate. After all, people who can buy Moutai on iMoutai are basically young people, while middle-aged and elderly consumers at offline physical stores are hard to capture. According to the industry association’s traditional baijiu consumption definitions in 2025, the main body of baijiu consumption is still middle-aged and elderly people aged 40–55, accounting for 68%; those aged 30–40 account for 22%; and those aged 20–30 account for only 5%. Young people aged 20 to 40 have an overall baijiu consumption share of only 27%. There is also data showing that in Moutai’s consumer base, the share of young people born in the 1990s and 2000s is about 33%—with about 25% post-1990s and about 8% post-2000s. How to educate these young people to like drinking Moutai is likely the drunkard’s real intent.

Is Moutai’s “cross-industry” move always on the way?

Moutai has done multiple rounds of “cross-industry” moves before, and overall it faced challenges. Early cross-industry moves focused mainly on beer and wine. Around the early 2000s, it invested tens of billions to build factories, aiming to promote Moutai-quality Moutai beer. It was priced too high. Due to factors such as channels, taste, and costs, it could not fully compete with Snowflake and Tsingtao, suffered losses for a long time, and ultimately ended in being put under management and delisted, with the brand fading out. Moutai’s wine business has also been laid out for many years. It was positioned in the mid-to-high end, but it had weak brand awareness, no channel advantage, and average product strength, leading to long-term losses and remaining only as a marginal business, without forming scale and profit.

In recent years, Moutai has started cross-industry “youthful” moves. Moutai ice cream, sauce-aroma latte, and liquor-soul chocolate were basically high at launch and low afterwards. Take Moutai ice cream in 2022 as an example: first-day sales exceeded 200,000 RMB, and after 7 months the revenue was 262 million RMB, and it was hyped to 250 RMB per box. As a result, in 2024 the business division was dissolved, stores across the country closed in batches, iMoutai removed the products; the terminal price fell from 66 RMB to 9.9 RMB for a clearance sale.

In 2023, Moutai collaborated with Luckin Coffee to release sauce-aroma latte. At its peak, first-day sales were 5.42 million cups, and sales exceeded 100 million RMB, making it trend across the entire internet. Three months later, daily average sales fell to under 30,000 cups, and the repurchase rate was low; starting in July 2024, it gradually exited the market. In this year, Moutai also collaborated with DOVE to release liquor-soul chocolate. It sold out at launch, with strong topic heat. But the result was also a rapid fade of buzz and no sustained repurchases, and it was quickly removed from mainstream channels. In 2023, Moutai’s cross-industry revenue was only 474 million RMB, accounting for 0.3% of total revenue—almost negligible.

There are many other niche cross-industry moves too, such as Moutai cultural and creative products, and toothpaste and face masks produced under Moutai daily chemicals, as well as Moutai cultural tourism hotels. Most are brand showcases and non-profit attempts that did not form a scaled business and contributed little to performance.

Investor Liu Bo believes that the fundamental reason why cross-industry moves by high-end liquor companies are hard to succeed is brand-logic conflict. “The contradiction between luxury goods and fast-moving consumer goods is irreconcilable. The core value of high-end liquor lies in scarcity, prestige, collection, and its financial attribute for business settings, making it impossible to mass-market. The essence of cross-industry products is high frequency, low price, easy to obtain, and heavy on experience. You need to drive volume and make it affordable to the masses. The result is that high-priced fast-moving consumer goods won’t get repurchases, while low-priced offerings dilute the brand’s scarcity, harming your own brand even more—you end up pleasing neither side.”

Judging from Moutai’s prior cross-industry moves, some strategic positioning was vague. For the sake of youthfulness, the purpose of cross-industry was to attract young people and cultivate future potential consumers. In reality, young people remember “Moutai makes ice cream” and “sauce-aroma coffee,” so converting them into baijiu consumers still faces challenges, and growth in the main business did not benefit. Frequent cross-industry moves may dilute the high-end image.

Moutai entering the pet segment is the transformation of liquor spent grain into circular-economy outputs. It resource-izes byproducts of the main business, addresses environmental pain points, aligns with ESG (environmental, social and governance), and does not dilute the baijiu brand. This makes it a more reliable second curve. Previously, Moutai used a luxury-minded mindset to do fast-moving consumer goods business, which went against industry rules and its own genetic strengths, causing cross-industry results to miss expectations. This cross-industry move, perhaps, is a truly sustainable one: extending the capabilities of the main business, recycling resources, and moving in a direction that does not harm the core brand value.

This article is an original work by BT Finance. Without permission, it may not be used, copied, distributed, or adapted. If it constitutes infringement, legal liability will be pursued.

Author | Meng Xiao

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