CJ CheilJedang vs Dongwon, Competing for 1st-2nd Place in the Porridge Market
Dongwon Challenges CJ with Soup Stew
CJ, Dongwon, Daesang, Heated Competition in Snack Ready Meals
[Asia Economy Reporter Choi Saeng-hye] With the increase in single-person households and the impact of the novel coronavirus disease (COVID-19), the Home Meal Replacement (HMR) market is heating up, and the food industry's battle for HMR market dominance has officially begun. CJ CheilJedang, the number one in the HMR market, has caught up to Dongwon F&B, which has held the top spot in the instant porridge market for 30 years.
◇CJ catches up in the porridge market in just 2 years= According to Nielsen Korea on the 3rd, CJ CheilJedang's 'Bibigo Porridge' held a market share of 39.4% in April, surpassing Dongwon F&B's 'Yangban Porridge' at 39.1% by 0.3 percentage points. This is the first time Bibigo Porridge has overtaken Dongwon F&B's Yangban Porridge. Yangban Porridge has maintained the number one position for 30 years since its launch in 1992. Looking at the annual data, when CJ CheilJedang first launched Bibigo Porridge in 2018, Dongwon F&B held 60.2% market share, while CJ CheilJedang had 4.3%. The following year, Dongwon F&B's share dropped to 43.4%, and CJ CheilJedang's rose to 34.6%, narrowing the gap. Monthly market shares this year show Dongwon F&B at 40.3% and CJ CheilJedang at 35.7% in January; Dongwon F&B at 42.3% and CJ CheilJedang at 36.0% in February; and Dongwon F&B at 42.0% and CJ CheilJedang at 37.9% in March.
CJ CheilJedang entered the market late by launching Bibigo Porridge at the end of 2018 but quickly gained popularity, surpassing 100 billion KRW in cumulative sales within just 17 months, leading the entire commercial porridge market. The commercial porridge market, which was around 70 billion KRW in 2017, doubled to approximately 130 billion KRW last year when Bibigo Porridge began full-scale sales. Especially in the pouch porridge category, where Bibigo Porridge holds an overwhelming market share of about 60%, other companies have also jumped in, showing even greater growth. CJ CheilJedang plans to grow Bibigo Porridge into a mega HMR product worth over 100 billion KRW this year and focus on securing the number one market position.
◇Dongwon focuses on soup and stew, Ottogi on seafood HMR= Dongwon F&B has entered the soup and stew market, where CJ CheilJedang holds an unshakable number one position, by promoting the 'Yangban' brand. They launched 14 types of 'Yangban Soup and Stew' HMR products in convenient pouch form. Following the Yangban brand philosophy, carefully selected natural ingredients are cooked in a traditional cauldron style to capture the deep flavors of authentic Korean cuisine. To produce soup and stew, Dongwon F&B invested 40 billion KRW in new advanced specialized equipment on a 3,000-pyeong site at their Gwangju factory. Dongwon F&B aims to achieve 50 billion KRW in sales from Yangban Soup and Stew this year and grow the product line to 100 billion KRW by 2022.
Ottogi, which pioneered the HMR market in 1981 with '3-Minute Cooking,' expanded its HMR lineup with 25 types of convenient cup rice products following 'Ottogi Rice.' Additionally, Ottogi has introduced various new frozen bakery products such as frozen pizza, burritos, croque-monsieur, and hot dogs. In May last year, Ottogi accelerated competition by expanding into seafood convenience foods.
◇700 billion KRW market, capturing easy-to-prepare side dishes= With the rise of drinking alone and home parties, the easy-to-prepare side dish market has emerged as a new growth area for food companies. The domestic market for easy-to-prepare side dishes reached approximately 700 billion KRW last year. The leading company is Daesang. Daesang's Cheongjeongwon pioneered the frozen easy-to-prepare side dish market in 2016 by launching 'Anjuya (Night).' As of last year, the cumulative market share for frozen easy-to-prepare side dishes was 47.9% for Daesang, 15.1% for Dongwon, and 6.7% for Ottogi.
CJ CheilJedang recently launched 'Jeil Anju,' a room-temperature easy-to-prepare side dish brand. CJ CheilJedang is differentiating itself by focusing on room-temperature products. The lineup includes four types: ▲Soyang Bulgogi Intestines ▲Boneless Spicy Chicken ▲Spicy Pork Skin ▲Spicy Fish Roe Stew, mainly featuring dishes that are difficult to prepare at home due to ingredient sourcing.
Daesang also recently entered the room-temperature easy-to-prepare side dish market from frozen products, signaling full-scale competition. Room-temperature Anjuya features high-quality side dishes based on Cheongjeongwon's seasoning technology and expertise as a specialized side dish brand, leveraging its know-how in raw material processing and manufacturing. Carefully selected raw materials and Anjuya's unique pre-processing techniques eliminate off-flavors, while the spicy and savory Anjuya secret sauce delivers a distinctive taste. Notably, these products can be stored at room temperature for 9 months without freezing or refrigeration, offering excellent storage and transport convenience. The lineup consists of six types: ▲Whole Garlic Assorted Intestines ▲Spicy Pork Cartilage ▲Spicy Pork Skin ▲Soyang Pork Intestines ▲Whole Garlic Spicy Pork Cartilage ▲Whole Garlic Spicy Pork Skin.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
