Shinsegae L&B Reenters Soju Market... Can It Revive the Comprehensive Liquor Company?

Limited Sale of 'King Soju 24' at Emart24 from the 21st
Jeju Factory Restarted... Blueprint for Full-Scale Soju Business

Shinsegae has once again thrown down the gauntlet in the soju market by launching 'King Soju 24'. Although Shinsegae L&B, which has positioned itself as a comprehensive liquor company, has shown sluggish performance without clear results, market interest is growing as it seeks to create a turning point for expanding into various liquor categories such as distilled soju and whiskey through the release of the diluted soju King Soju 24.

Shinsegae L&B 'King Soju 24'

On the 21st, Shinsegae L&B officially began selling the limited edition soju ‘King Soju 24’. King Soju 24 is a planned product with label design by the famous webtoon artist and broadcaster Gian84, produced in a limited quantity of 400,000 bottles, and sold exclusively at convenience store Emart24.

Shinsegae Group re-entered the domestic soju market for the first time in two years since 2021. Previously, Emart acquired Jeju Soju for 19 billion KRW in 2016 and entered the soju market the following year with the brand 'Pureunbam' (Blue Night). Pureunbam attracted market attention as it was known that Shinsegae Group Vice Chairman Jeong Yong-jin personally oversaw everything from the acquisition of Jeju Soju to the product launch, earning it the nickname ‘Jeong Yong-jin Soju’. With the owner directly supporting the business and Emart, a major distribution channel, as the parent company, expectations in the market were high.

Pureunbam’s initial performance was not bad, selling 3 million bottles within the first four months of launch. However, consumer interest did not last long due to the strong market dominance of existing leading products such as ‘Chamisul’ and ‘Cheoeumcheoreom’. Jeju Soju’s operating losses increased from 1.9 billion KRW in the acquisition year 2016 to 10.6 billion KRW in 2020, leading to a state of capital erosion. Ultimately, Jeju Soju ceased operations in 2021 and was absorbed and merged into Shinsegae L&B.

Shinsegae L&B’s release of King Soju 24 is interpreted as a blueprint to restart the Jeju factory and to actively expand its business into various liquor categories including soju. Last year, Shinsegae L&B introduced the sparkling beer ‘Let’s’, signaling its plan to evolve from a wine import and distribution company into a comprehensive liquor distribution company. This year, it launched its second sparkling beer product, 'Kingdom of the Delight', last month. However, no product has yet shown meaningful results. It is pointed out that to become a comprehensive liquor company, concrete achievements in liquor categories other than its existing core business of wine are necessary.

With the launch of King Soju 24, Shinsegae L&B is expected to re-examine the Jeju factory’s facilities and, based on market response, concretize business utilizing the Jeju factory not only for diluted soju but also for distilled soju and whiskey. The Jeju factory, which had stopped after Jeju Soju’s liquidation due to losses, has been producing fruit soju products for export to Southeast Asia under an Original Design Manufacturer (ODM) model since June last year, and plans to launch distilled soju next year. The K-whiskey business is also expected to be centered around the Jeju factory. Shinsegae L&B already filed trademarks reminiscent of Jeju Island such as 'Jeju Whiskey', 'Tamna Whiskey', and 'Tamna Pure Malt Whiskey' with the Korean Intellectual Property Office last year.

However, Shinsegae L&B maintains that while it is always preparing for the soju business, there are no officially concrete plans yet. The company stated that King Soju 24 is a one-time planned product released to understand diverse consumer needs and trends in the soju market, and drew a line on the possibility of additional production and expansion of distribution channels. The release of a high-alcohol diluted soju, which runs counter to market trends, is also not unrelated to this background.

The most striking feature of King Soju 24 is its alcohol content raised to 24%, which directly contradicts the domestic soju market trend of steadily lowering alcohol content. Shinsegae L&B explained, “We differentiated the product by launching it at 24%, the highest alcohol content among diluted soju,” adding, “We judged there would be demand from consumers who seek hard liquors such as whiskey and from enthusiasts who enjoy high-alcohol beverages, which led to the release of a high-alcohol product.”