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

Recently, a research report compared the popular Labubu with traditional liquor giants, attempting to reveal whether this is a replay of the consumption cycle or a profound paradigm shift.

Analysis shows that although Labubu and Moutai both possess characteristics of social currency, there are significant differences between the two. Labubu's social attributes are primarily based on the common interests and values of the younger demographic, while Moutai relies more on traditional power and hierarchical relationships. This difference reflects the essential distinction between "new consumption" and "traditional consumption."

However, similar to Moutai, Labubu's parent company also faces the dual challenges brought by the IP cycle and investment attributes. If there is a long interval between Labubu and the next hit IP, the company's global growth may slow down.

In addition, investors should pay attention to the two major risks of regulation and market crowding. The current phenomenon of capital concentration pouring into the "new consumption" sector is quite similar to the previous situation where funds clustered around blue-chip stocks. The fragility of this crowded trading may have a significant impact on valuations.

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Generational Differences in Social Currency

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

1. Social Function: Moutai serves more as a "social/business lubricant" productivity tool, while Labubu represents the younger generation's pursuit of emotional value, providing consumers with an instant, delicate, and affordable "dopamine" experience.

2. Consumption Motivation: In a digital world where consumers face "meaninglessness" and increasing pressure, Labubu suggests that China is gradually shifting from an investment-driven model to a consumption-driven model.

3. Globalization Process: Moutai is deeply rooted in Chinese traditional culture, and its globalization process is still in the early stages, while Labubu, which is highly in line with the spirit of the global era, has already achieved significant global success.

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

While experiencing rapid growth, Labubu's parent company is also facing challenges similar to those of Moutai:

1. IP lifecycle risk: Moutai, with a hundred years of history and official endorsement, has proven its ability to weather cycles. In contrast, Labubu has a relatively short 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, acting as a booster in upward cycles and becoming an amplifier in downward cycles.

The report indicates that Labubu's parent company is actively managing the second-hand market prices to ensure its appeal to young consumers and create a favorable environment for the launch of new IPs and products.

Regulatory and Market Congestion Risks

1. Regulatory risk: Moutai is always affected by price controls and anti-corruption movements. Similarly, Labubu's parent company is not in a regulatory vacuum. Recent media reports have alerted the market to related risks.

2. The vulnerability of "group" trading: The current phenomenon of capital concentration in the "new consumption" sector is quite similar to the previous trend of capital clustering in blue-chip stocks. Changes in capital flow and positions may have a significant impact on valuations.

Analysis suggests that, against the backdrop of scarce high-quality investment targets, this "crowded" situation may persist for some time. The real turning point may only come when meaningful turning points appear in high-frequency data from overseas markets, or when a strong recovery in the Chinese economy provides investors with more choices.