Why Can't Traffic Jams Save Gujing Gongjiu's Performance Slump?

Text | Xiao Tian

“Green liquid,” “Green wave,” “Good green liquid”… If it weren’t for the epic traffic jam during the Spring Festival, probably no one would notice the billboard standing on the highway in Anhui that has left many drivers scratching their heads.

How exactly are these three characters pronounced? Instantly, a nationwide discussion about “literacy rates” erupted, with related topics easily surpassing 100 million views.

In response to this sudden “meme creation,” the behind-the-scenes operator—Mingguang Distillery, a subsidiary of Gujinggong Liquor (000596.SZ)—had to come out immediately to clarify: it’s called “Ming Green Liquid,” with the font designed by the late calligrapher Xie Deping.

Ironically, this billboard, dubbed by netizens as “the biggest wrongful advertisement in history,” has stood alone for many years. The advertising industry has long agreed: they spent a lot of money, but even their own name isn’t memorable.

However, the magic of traffic lies in this. When the anxiety of traffic jams meets the confusion of literacy, Gujinggong Liquor keenly seized this wave of attention. In just a week, its subsidiary, Gujing Light Nourishing Society, quickly launched a milk tea called “Milk Green Wave,” priced at 16 yuan, forming the so-called “Ming Guang Three-piece Set” with “Wang Green Wave Mung Bean Cake” and “Ming Green Liquid Liquor.”

From being mocked to being celebrated, Gujinggong Liquor seems to once again prove its status as a “marketing master.” But when we clear the fog of traffic and examine this leading Huizhou liquor company’s financial reports and strategy, we find an awkward reality: In the current deep adjustment of the Baijiu industry, Gujinggong Liquor is undergoing an unprecedented “stress test.”

Although as the leader of Huizhou liquor, Gujinggong Liquor has not broken out of its independent market. In the first three quarters of 2025, the company’s revenue was 16.425 billion yuan, down 13.87% year-on-year; net profit attributable to shareholders was 3.96 billion yuan, down 16.57%.

Chairman Liang Jinhui’s pledge to reach 30 billion yuan in revenue by 2025 now seems unlikely to be fulfilled.

Traffic will eventually fade away. When the “Milk Green Wave” hype subsides, the outside world will be more concerned about how far Gujinggong Liquor can go.

1. The accidental “popularity” of an old famous liquor

The recent “viral” success of Ming Green Liquid appears to be luck brought by traffic congestion, but in fact, it is an accidental realization of Gujinggong Liquor’s long-term “high-profile” strategy.

The last time Ming Green Liquid received such attention was five years ago. At that time, Gujinggong Liquor acquired a 60% stake in Mingguang Distillery for 200 million yuan in a lightning deal, bringing it under its umbrella.

Behind this deal lie two anxieties and ambitions of Gujinggong Liquor: one is to compensate for its own shortcomings; the other is to improve its product matrix.

On one hand, although Gujinggong is the big brother of Anhui Baijiu, it has long been a “blind spot” in the Chuzhou area of eastern Anhui. Mingguang Distillery, rooted locally for decades, just fills this gap.

Additionally, Mingguang Distillery has an annual capacity of about 30,000 tons (about one-third of Gujinggong’s current capacity), which can ease the capacity pressure during Gujing’s technological upgrades.

On the other hand, Ming Green Liquid’s main flavor, “Ming Green Fragrant,” complements Gujinggong’s strong aroma style, expanding its aroma type layout and forming a product matrix of “three products and four aromas.”

Unlike other Baijiu, Ming Green Liquid uses mung beans as the core raw material, combined with sorghum and wheat, emphasizing the fusion of mung bean aroma and aged aroma, and proposing the exclusive “Ming Green Fragrant” aroma type.

Due to its unique ingredients and flavor profile, Ming Green Liquid was once rated as a “rare flower in liquor,” received the Ministry of Light Industry’s high-quality product award, and after entering the new millennium, was named a famous trademark of Anhui Province. Its brewing process has also been patented nationally.

Few know that Ming Green Liquid is one of the few high-end Baijiu in Anhui priced in the thousands. The 53-degree Ming Green Liquid is nicknamed “Green Moutai” (green Maotai). The official price is 1,280 yuan per bottle, with terminal transaction prices around 800 yuan, comparable to top-tier high-end Baijiu.

After Gujinggong Liquor acquired Mingguang Distillery, it entered the fast lane.

Before the acquisition, Mingguang Distillery’s annual sales were around 300 million to 400 million yuan, but after being acquired, it continued to grow rapidly, surpassing 600 million yuan the next year, breaking 1 billion yuan in 2023, and reaching 1.1 billion yuan in 2024 (including taxes and market investments, reportedly up to 1.5 billion yuan). Especially, “Green Moutai” contributed over 60% of the revenue.

Objectively, Gujinggong Liquor’s support after acquiring Ming Green Liquid has been substantial.

For example, Gujinggong introduced mature tactics like the “Three-Connection Project” in Mingguang Distillery, focusing on product branding; after the “Gujing-Ming Collaboration,” Mingguang Distillery adopted a “visible, perceptible, tangible” large-brand communication approach, focusing on major media and transportation channels. The giant billboards along highways are from that period.

To some extent, the sudden popularity of Ming Green Liquid is not accidental but a natural result of Gujinggong’s long-term saturation attack, triggered by a sudden event.

2. The marketing failure of the “Spring Festival Gala staple”

However, the unexpected popularity of Ming Green Liquid cannot hide the fatigue in Gujinggong Liquor’s overall marketing strategy.

Some netizens jokingly call Gujinggong Liquor a “Spring Festival Gala staple,” which is not an exaggeration.

Since 2016, Gujinggong has appeared as a designated partner of CCTV’s Spring Festival Gala, and by 2026, it will have been 11 consecutive years of exclusive sponsorship.

Besides the Spring Festival Gala, Gujinggong has sponsored Anhui TV’s Spring Festival Gala for many years. It has also sponsored Jiangsu TV’s Lantern Festival Gala and Anhui TV’s Lantern Festival Song and Dance Gala.

This approach has led to continuously rising sales expenses.

Financial reports show that Gujinggong’s sales expenses exceeded 2 billion yuan in 2017, 3 billion yuan in 2019, 4 billion yuan in 2021, over 5 billion yuan in 2023, and more than 6 billion yuan in 2024.

From 2021 to 2024, the total sales expenses amount to about 20.3 billion yuan, and including the first three quarters of 2025, nearly 25 billion yuan.

Money has been spent, but the results are not proportional.

Compared to other industry giants like Kweichow Moutai, Luzhou Laojiao, Shanxi Fenjiu, and Yanghe, Gujinggong’s sales expenses are among the highest, even higher in proportion. But its fame outside Anhui is far less than Moutai or Wuliangye.

Among listed Baijiu companies, Gujinggong ranks sixth in revenue, behind Moutai, Wuliangye, Shanxi Fenjiu, Luzhou Laojiao, and Yanghe. Among these six giants, Gujinggong’s sales expenses and expense ratio are among the highest, with the highest sales expense ratio.

In short, Gujinggong’s traditional marketing approach—high-profile advertising and sponsorship—seems to be losing effectiveness.

For example, Gujinggong’s revenue broke 10 billion yuan in 2019 and 20 billion yuan in 2023. At the end of 2023 and early 2024, it announced a goal of 30 billion yuan in revenue by 2025.

But according to financial data, in the first three quarters of 2025, Gujinggong’s revenue was 16.425 billion yuan, down 13.87% year-on-year; net profit was 3.96 billion yuan, down 16.57%. This target is unlikely to be achieved.

3. A step into the national stage as a Huizhou liquor leader

The growth logic of Baijiu industry has always been clear: either upscale or nationwide. For regional liquor companies, the latter is a matter of life and death.

In 2014, Liang Jinhui, skilled in marketing, officially became the new leader of Gujinggong Liquor, vigorously expanding the mid-to-high-end Baijiu market, promoting “aged original mash” nationwide, and increasing marketing expenses.

Meanwhile, through “self-expansion + external acquisitions,” Gujinggong sought to expand nationwide, acquiring brands like Huanghelou and Mingguang, forming multiple aroma types such as strong, light, sauce, and Ming Green.

The results were immediate.

In just five years, Gujinggong’s revenue first surpassed 100 billion yuan. Later, Liang Jinhui proposed the strategy of “recreating a new Gujing,” and in 2024, successfully achieved the 20 billion yuan revenue target.

In the Baijiu industry, 50 billion, 20 billion, and 10 billion yuan are typical thresholds for the first, second, and third tiers of brands. Among these, 20 billion yuan is seen as a dividing line between national and regional brands.

However, 20 billion yuan is a threshold, not a passport. True nationwide presence depends on the proportion of revenue outside the province.

On the surface, Gujinggong already seems to be stepping into the national Baijiu brand camp. But closer inspection shows that, compared to Yanghe and Shanxi Fenjiu, whose outside-province revenue share exceeds 50%, Gujinggong still retains a “provincial” impression.

As the leading Huizhou liquor with a strong brand gene, Gujinggong’s market share is about 60% inside Anhui and 40% outside. Regionally, over 85% of its revenue comes from Central China, with Anhui as its core market.

Despite surpassing 200 billion yuan in revenue, it is still classified as a provincial liquor—an unbreakable curse.

4. The unbreakable curse

Looking back at Gujinggong’s history, it dates back to the Ming Dynasty’s Zhengde era as one of the “Eight Famous Liquors,” once shining brightly—by 1997, it reached 960 million yuan in revenue, ranking third after Wuliangye and Luzhou Laojiao.

However, due to reckless diversification, management corruption, and other mistakes, Gujinggong missed the golden decade of Baijiu and retreated from a national enterprise to a regional one.

Particularly, early on, the company adopted a “lower alcohol, lower price” strategy, which prevented it from keeping pace with the high-end development trend of Baijiu, deeply affecting its high-end brand image.

For example, Gujinggong’s core strategy is “nationalization, mid-to-high-end, continuous product structure optimization, deep cultivation of different price segments; continuing to focus on “Gujing 20” as a strategic pivot to capture the mid-to-high-end consumer group; further expanding the market share of popular products like Gu8, Gu5, Xianli, and old famous liquors to meet consumer demand across price ranges.”

In Anhui, Gujinggong’s price range is comprehensive and very strong locally. Whether at festivals, banquets, or in catering and hotel channels, it is highly recognized by consumers. But this is limited to the sub-500 yuan market.

The high-end market above 500 yuan is mostly dominated by outside brands like Moutai, Langjiu, Xijiu, Fenjiu, and Wuliangye.

According to industry research, the Anhui Baijiu market is about 40 billion yuan in 2024, with foreign famous brands like Moutai and Wuliangye occupying 25-30%, or 10-12 billion yuan.

The industry’s traditional saying “Sichuan doesn’t enter Chuan, Anhui doesn’t enter Hu” reflects the fact that Sichuan and Anhui produce many famous liquors, making it hard for outsiders to break in. But the “East doesn’t enter Anhui” pattern is gradually being torn apart, forcing Gujinggong to both deepen its roots in Anhui and urgently expand beyond it.

In fact, Gujinggong not only faces high-end competition in Anhui but also encounters challenges from many other Baijiu brands when trying to go beyond Anhui, due to its mid-to-high-end positioning.

Take its flagship “Aged Original Mash” as an example. As early as 1997, Gujinggong launched “Ten-Year Original Mash,” transplanting the concept of “aged liquor” into Baijiu.

Most consumers understand “original mash” as unblended base liquor, with the number indicating the aging years—e.g., Gu20 means 20 years old. However, Gujinggong’s official stance is that “Aged Original Mash” does not mean a specific aging period; it’s a trademark name, and the number suffix does not represent the actual brewing years.

This controversy has even become a defensive “weapon” for many well-known liquor companies against Gujinggong.

The traffic jam on the highway will eventually clear, and the “Ming Green Liquid” meme will fade with time.

When the traffic subsides, the naked swimmers will be revealed. For Gujinggong, how to break the “provincial liquor” curse and carve a path in the narrow high-end market is a more profound question than the “Milk Green Wave” milk tea.

After all, in capital markets, stories can be told for a while, but performance must be backed by real results. The unfulfilled goal of 30 billion yuan may be the starting point of Gujinggong’s new transformation or the end of its growth ceiling.