Lee Cheol-woo, Governor of Gyeongbuk, "Andong Soju Undervalued, Will Break into Global Market Riding the Korean Wave"

Gyeongbuk Province Forms Globalization TF

Introduces Whiskey Sales Strategy

On the 12th, Gyeongbuk Province announced that it will focus its efforts on globalizing ‘Andong Soju,’ which has a longer history than whiskey and is comparable in quality, so that it can become a brand that captivates the tastes and sentiments of people worldwide.

Since COVID-19, the domestic liquor market has undergone a period of upheaval. According to trade statistics from the Korea Customs Service, imports of whiskey increased by 52.2% last year compared to the previous year. This is interpreted as a growing interest due to the establishment of a so-called ‘home drinking’ culture, where gatherings and company dinners have decreased and more young people are experiencing high-end whiskey at home.

The Scotch whisky industry reached 10 trillion won for the first time last year despite the COVID-19 pandemic, and it is a representative industry where 90% of the whisky produced in Scotland is exported.

Traditional and historic Scotch whisky brands have established distillery tours and whisky tasting experiences linked with local attractions as popular tourist products, attracting 2 million visitors annually.

Governor Lee Cheol-woo of Gyeongbuk is visiting the Andong Soju manufacturing plant and experiencing the process of making soju firsthand.

China’s Moutai also employs a two-track strategy by maintaining a premium brand and launching mid-to-low priced brands targeting diverse consumers. Supported by simplification of distribution processes such as O2O (online to offline) and mobile app enhancements, as well as overseas market penetration through brand globalization, it has become a global liquor company with a market capitalization of 420 trillion won?higher than Samsung Electronics?and annual sales reaching 20 trillion won.

Japanese whisky is one of the world’s top five whiskies alongside Scotland, Ireland, the United States, and Canada. Among them, Yamazaki whisky won the gold medal at the 2003 International Spirits Challenge and was selected as ‘World’s Best Whisky’ in 2015. According to Japanese customs, Japan exported liquor worth 1.33 trillion won in 2022, with whisky exports reaching 535.5 billion won.

According to Korea Customs Service import-export trade statistics, South Korea’s imports of Japanese whisky increased by 31.14% last year compared to the previous year. This is believed to be due to a recent easing of anti-Japanese sentiment, leading to a revival in consumption of Japanese products and a corresponding increase in Japanese whisky imports.

Gyeongbuk Province’s traditional liquor shipments last year amounted to 14.3 billion won, a surge of over 70% compared to 8.4 billion won in 2018 before COVID-19. Amid this market situation, Governor Lee Cheol-woo of Gyeongbuk is working to globalize Andong Soju based on the know-how of Scotch whisky’s growth into a global brand.

Last month, Governor Lee visited Scotland, met with representatives of the Scotch Whisky Association, and examined whisky manufacturers and distillation equipment manufacturers. To swiftly introduce Scotch whisky’s globalization strategies to local traditional liquors, he actively visited Min-sokju Andong Soju (CEO Kim Yeon-bak) and Milgwa Nonilda (CEO Park Seong-ho) in Andong on the 11th.

At Min-sokju Andong Soju, Governor Lee personally experienced the traditional liquor manufacturing process and stated that since making Andong Soju requires great effort, standardized quality certification criteria will be established to nurture it as a premium brand. He also pledged to provide unwavering promotion and support to help Milgwa Nonilda grow into a world-class luxury liquor.

Gyeongbuk traditional liquors are led by Min-sokju Andong Soju companies and enterprises founded by those who have returned to rural areas in Gyeongbuk.

The liquors of Myeongin Andong Soju (CEO Park Jae-seo), Min-sokju Andong Soju (CEO Kim Yeon-bak), and Milgwa Nonilda (CEO Park Seong-ho) are popular among the MZ generation as cocktail ingredients. Last November, Kim Chang-su Whisky Distillery, which signed an investment agreement with Gyeongbuk Province, plans to invest 20 billion won by 2026 to establish a whisky manufacturing plant in the Andong Bio-Industrial Complex.

Facing a decline in rice consumption and undergoing an agricultural transformation, Gyeongbuk Province is focusing its capabilities on the globalization of traditional liquor through high value-added agriculture and export industrialization, and is seeking response strategies to secure competitiveness in the global market.

Gyeongbuk Province has formed the ‘Andong Soju Globalization T/F Team,’ led by Park Chan-guk, Director of the Agricultural Food Distribution Division, with participation from Gyeongbuk Province, Andong City, traditional liquor manufacturers, and universities. The team plans to develop representative products and establish concrete strategies for the industrialization and globalization of Andong Soju.

Additionally, a promotional center for Andong Soju will be built in a hot place in the Andong area to nurture it as a new attraction enjoyed by all age groups, contributing to the expansion of Andong Soju’s base.

Andong Soju companies, Gyeongbuk Province, and Andong City will jointly promote Andong Soju through campaigns, liquor tasting contests, brewery experiences, and soju tasting events, and will support tasting facilities at breweries. Standardized governor-certified quality criteria for Andong Soju’s raw materials, alcohol content, and aging will be established, and cooperation with universities will help nurture it as a premium brand.

Furthermore, administrative efforts will focus on expanding exports by supporting traditional liquor companies’ participation in overseas food fairs, inviting liquor specialist buyers, and conducting export consultations to discover overseas buyers.

In addition, to stabilize the management of Andong Soju companies, support will be provided through agricultural food processing promotion projects and rural development funds to build a high value-added production base for Andong Soju. Promotional strategies will be devised to create empathy across all age groups by featuring famous idol groups, trot singers, and influencers as brand ambassadors.

Through personnel and technology exchange support promised during Governor Lee Cheol-woo’s visit to Scotland in February, the Scotch whisky globalization strategy will be introduced to Andong Soju.

Governor Lee Cheol-woo of Gyeongbuk Province said, “Andong Soju is a traditional liquor that can compete shoulder to shoulder with world-renowned spirits such as Scotch whisky, China’s Baijiu, and Japanese sake, but it has been undervalued compared to other liquors. We will combine master brewers’ expertise with modernized technology to make Andong Soju not only a Korean premium liquor but also a world-class luxury liquor riding the Korean Wave.”