HiteJinro Co Ltd, a major manufacturer of alcoholic beverages based in South Korea, is generating a boom in soju (distilled liquor originated from South Korea) demand in Malaysia and Indonesia.
HiteJinro revealed on Apr. 15 that the growth rate of soju exports to Malaysia last year worked out to being five times the growth rate of 2016. Exports to Indonesia also tripled during the same period.
In fact, HiteJinro saw the highest growth rate in Malaysia among countries it exports to in Southeast Asia. Exports continued to grow last year. Soju exports to Malaysia rose a huge 137% last year compared to the previous year. The average annual growth rate over the past four years also works out to an impressive 58%. Meanwhile, Indonesia, the world’s fourth most populous country, is a market with high demand for food and beverage.
Last year’s soju exports rose 55% compared to 2018. The average annual growth rate over the past four years is estimated to be at 45%.
Malaysia and Indonesia have strict regulations concerning alcoholic drinks as stipulated by their national policies. Despite this, the high growth rate seems to have been able to be achieved as a result of the expansion of online and offline markets and effective marketing that specifically targeted consumers in their 20s and 30s.
HiteJinro did in fact run marketing activities to introduce the culture of “somaek,” a blend of beer and soju popularly drank in South Korea, to local businesses. The alcoholic beverages maker also plans to officially begin running local social media activities within the first half of this year.
In particular, HiteJinro has been developing its local distribution networks by fronting fruit liqueur, which is popular among local young people. As a result, the proportion of fruit liqueur sales of its total sales in Malaysia went up from 14% in 2018 to 55% last year.
The company is also expanding its offline sales channels in Indonesia, where it entered Bottle Avenue, a large local outlet, this past March.
“We declared soju globalization in 2016 and are in the midst of leading the soju market by specifically targeting Southeast Asian countries such as Vietnam and Malaysia after considering various factors such as economic growth, demographics, current condition of the alcoholic beverages market,” said Hwang Jung-ho, managing director of overseas business at HiteJinro. “We will develop products tailored to meet young consumers’ demands and pursue locally customized strategies.”