Labubu and Moutai: The Generational Struggle of New and Old Social Currencies

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

Analysts point out that although Labubu and Moutai both possess the attributes of social currency, there are essential differences between the two. The social characteristics of Labubu are more based on the shared interests and values of the younger demographic, while Moutai relies more on power and hierarchical relationships. This difference reflects the fundamental distinctions between “new consumption” and “traditional consumption.”

The report believes that the company where Labubu is located also faces the dual challenges posed 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 congestion are two major factors that investors cannot ignore. The current phenomenon of capital concentration pouring into the “new consumption” sector is quite similar to the previous trend of funds clustering around blue-chip stocks, and the fragility of this crowded trading could have a significant impact on valuations.

Intergenerational Differences in Social Currency

The research team believes that Labubu and Moutai, while both possessing social currency attributes, have significant generational differences.

1. Social attributes: Moutai more embodies the productivity tool role of a “social/business lubricant”, while Labubu represents the younger generation’s pursuit of emotional value, offering an instant, delicate, and affordable “dopamine” experience.

2. Consumption Motivation: Moutai mainly serves business occasions, while Labubu meets the emotional needs of young people in a digital social environment, reflecting China’s trend of transitioning from investment-driven to consumption-driven.

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

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

While experiencing rapid growth, the report also pointed out the challenges faced by the company where Labubu is located:

1. IP lifecycle risk: Moutai has proven its ability to traverse cycles, while Labubu has a shorter history, making the IP lifecycle a core risk.

2. The pros and cons of investment attributes: The history of Moutai indicates that “investability” serves as a booster in an upward cycle, while it becomes an amplifier in a downward cycle.

3. Balancing Growth and IP Lifecycle: The company is actively managing the prices in the secondary market to ensure attractiveness to younger consumers and create a favorable environment for the launch of new IPs and products.

Regulatory and Market Congestion Risks

The report emphasizes that regulation and market sentiment are two other risk factors that investors must confront.

1. Regulatory risk: Although the company where Labubu is located is not in a regulatory vacuum, the diversification of its consumer base and the growth of its overseas business help to mitigate risks.

2. The vulnerability of “herd” trading: The current phenomenon of capital集中在"新消费"赛道 is similar to the previous influx of funds into consumer blue-chip stocks. Changes in capital flow and positions can have a significant impact on valuations.

The report believes that under the backdrop of scarce quality investment targets, this “crowded” situation may persist for some time. The real turning point may only come when high-frequency data from overseas markets shows a turning point, or when a strong recovery in the Chinese economy provides more options for investors.

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