Labubu and Moutai: The Intergenerational Clash of New and Old Social Currencies

A certain bank in the United States recently released a report comparing the emerging trendy IP Labubu with traditional liquor giants, attempting to explore whether this is a historical repetition of the consumption cycle or a profound paradigm shift.

The report points out that although Labubu and Moutai both possess the attributes of social currency, there are significant differences between the two. The social attributes of Labubu are primarily based on the common interests and values of the younger generation, while the social functions of Moutai rely more on power and hierarchical relationships. This difference reflects the essential distinction between "new consumption" and "traditional consumption."

Analysts believe that, similar to Moutai, the manufacturer of Labubu also faces a dual challenge brought by the IP cycle and investment attributes. If there is a long gap between Labubu and the next hit IP, the company's global growth may slow down.

In addition, regulatory risks and market crowding are two major risks that investors cannot ignore. The report warns that the current phenomenon of capital concentration pouring into the "new consumption" track is quite similar to the previous trend of funds clustering around blue-chip consumer stocks represented by Moutai, and the fragility of this crowded trading could have a huge impact on valuations.

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Generational Differences in Social Currency

The research team believes that Labubu and Moutai both possess social currency attributes, but there are significant generational differences between them:

1. Differences in social attributes: Moutai's social attributes rely more on power and hierarchical systems, primarily serving business occasions; Labubu represents the younger generation's social interactions based on interests and values, emphasizing emotional value and instant gratification.

2. Consumption motivation: Moutai can serve as a "productive tool" (business lubricant), while Labubu meets the young people's pursuit of emotional value and "dopamine" consumption in a digital social environment, reflecting China's transformation trend from investment-driven to consumption-driven.

3. Globalization Process: Moutai is deeply rooted in Chinese traditional culture, and globalization is still in its early stages; Labubu, on the other hand, has already achieved significant success globally, aligning with global trends.

The Double-Edged Sword of IP Cycle Risks and Investment Attributes

While experiencing rapid growth, Labubu's manufacturers also face similar challenges to Maotai, namely the dual test brought by the IP lifecycle and product investment properties.

1. IP lifecycle risk: Moutai has a century-old history and official endorsement, proving its ability to withstand cycles. In contrast, Labubu's manufacturer has a shorter history, making the IP lifecycle a core risk.

2. Pros and Cons of Investment Attributes: The history of Moutai shows that "investability" is a double-edged sword; it acts as a booster during an upward cycle and becomes an amplifier during a downward cycle.

The report notes that the manufacturer of Labubu is actively managing the second-hand market prices to ensure its appeal to young consumers and to create a favorable environment for the release of new IPs and products.

Regulatory and Market Congestion Risks

1. Regulatory risks: Moutai is always affected by policies such as price controls and anti-corruption campaigns. Similarly, the manufacturers of Labubu are not in a regulatory vacuum. As the consumer demographic becomes increasingly diverse, "mainstreaming" reduces its exposure to risks associated with minors in the Chinese market. At the same time, the growing overseas business helps to hedge against the regulatory risks of a single market.

2. The vulnerability of "group" trading: Currently, funds are concentrated in the "new consumption" track focused on Labubu, which is quite similar to the previous influx of funds into consumer blue-chip stocks represented by Moutai. Changes in fund flow and positions can have a significant impact on valuations. Although the recent changes in fund flow have placed some pressure on "new consumption" stocks, this "crowded" situation may continue for a while in the context of the scarcity of quality investment targets.