Soju so good: Korean alcoholic beverages gaining traction in South East Asia

By Lester Wan contact

- Last updated on GMT

Hite Jinro, with more than 50% of domestic soju market share, said it was opening more retail branches in South East Asia. ©GettyImages
Hite Jinro, with more than 50% of domestic soju market share, said it was opening more retail branches in South East Asia. ©GettyImages

Related tags: South east asia, Southeast asia

Korean alcoholic beverages such as soju, traditionally clear liquor usually distilled from rice, wheat or barley, appear to be gaining in popularity in South East Asian markets.

Various industry officials have commented that sales of soju in South East Asia are rapidly increasing.

According to the Yonhap News Agency​, one official said the popularity of Korean dramas and pop music was a key factor: "Consumer recognition of soju is very high in South East Asia because of the continuing popularity of K-dramas and K-pop.”

The growing demand is also leading to a new wave of product development.

Lotte Chilsung Beverage Co., part of the eminent Lotte Group, has just launched its export-exclusive Soonhari flavoured soju in Thailand and Vietnam.

While the traditional product popular in Korea is usually in original or traditional flavour, this new line is strawberry-flavoured. Lotte developed the soju with strawberry flavour for overseas consumers who may not be used to soju’s particular taste.

Retail expansion

Meanwhile, Lotte’s rival, Hite Jinro Co., which has more than 50% of the domestic soju market share, said it was opening more retail branches in South East Asia to drive sales of its soju.

Hite Jinro’s second Vietnamese branch has opened in Ho Chi Minh City two years after its entry in the market, and another new outlet is scheduled to open in the Philippines. The company also said that an "antenna shop" will open in Cambodia to test the market for its products.

Yonhap stated that Hite Jinro's soju sales in South East Asia had risen to US$6m in 2016 from $4.9m in 2015. It further leapt to $8.8m last year — a growth of 46.7% from the previous year.

In January, Hite Jinro also launched its Chamiseul soju in duty free shops in Hong Kong’s Chek Lap Kok International Airport. It had already been selling products at duty free shops in major Asean airports including in Singapore, Bali and Yangon.

Beer bonus

In addition to growing the soju market in South East Asia, Lotte is also hoping to drive beer sales in the region.

Lotte Liquor, a unit of Lotte Chilsung, will start selling beer in Phnom Penh, Cambodia.

It has recently delivered over 90,000 cans and bottles of its premium Kloud beer to major retail chains and convenience stores in the capital.

“Along with the Korean wave in South East Asian countries, many consumers in Cambodia have already shown high interest in Korean alcohol such as beers and soju,”​ said an official from Lotte Liquor, adding that the company would supply an additional 80,000 cans and bottles of Kloud beer to the country by next month.

Kloud, Lotte’s first line of beer, is sold in high-end restaurants, hotels and golf clubs.

In June, Lotte Liquor had launched its second line of beer, Fitz Super Clear, stating its desire to challenge rivals Hite Jinro and AB InBev in the standard beer sector.

Lotte Liquor’s second beer factory — with a production capacity of 300,000 kilolitres — was completed in July.

Exports are becoming increasingly important for Korean beer brands because foreign beer imports into the country surged to a record growth of 45% in 2017.

Related topics: Markets, East Asia, Industry growth, Beverages

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