ASIA: Global brands will struggle to catch domestic giants - analyst

By | 18 July 2012

Regional players are out-selling global brands

Regional players are out-selling global brands

Regional brands will continue to outsell international labels because drinking cultures remain local in most markets, an analyst has said.

In a list of the biggest-selling spirits brands in the world released yesterday (17 July), seven of the top ten sell at least 90% in their home market. South Korean soju brand Jinro again topped the annual IWSR’s Real 100, with 64.6m cases sold in 2011, more than double second-placed Ruang Kao.

Jinro sells 95% in South Korea and Thai Beverage’s Ruang Kao is sold exclusively in Thailand. This domestic stranglehold gives the brands an unassailable lead over international leaders such as third-placed Smirnoff and Bacardi (7th), according to Torsten Stocker, a partner at consulting firm Monitor Group.

“The leading 'local market' brands are more or less all mass-market brands, consumed, at least in case of soju, more like beer in terms of frequency and occasion, rather than spirits,” Stocker told just-drinks.

“In that sense, it's not that likely that one of the global brands will displace soju in the rankings.”

Jinro is owned by HiteJinro and despite a volumes fall of 7.5m cases since 2007, still leads the way in global terms. About 2% of spirits consumed in the world is Jinro.

“Jinro's strength continues to amaze me,” Stocker said. “This is largely a testament to the drinking hardiness of Koreans, as Jinro has not travelled that well, despite some success in Japan.”

Forty-five brands in IWSR's top 100 are Asian despite the omission of Chinese labels. IWSR blamed lack of information, however Stocker said regional baijiu brands are unlikely to worry the top spots because the market remains fragmented.

Last month, Jinro topped a EuroMonitor list of the best-selling spirits brands. Diageo's Smirnoff came second.

Expert analysis

Spirits in South Korea

Total volume of spirits increased positively in 2011, rising by around 3%. The main drivers of spirits are soju as well as imported spirits such as rum and white spirits. Low-alcohol content soju, and the changes of drinking culture towards more enjoyment of drinking rather than drinking purely for intoxication, helped spirits’ volume growth over the review period.

Sectors: Spirits

Companies: Thai Beverage, Smirnoff, Bacardi, Diageo

There are currently no comments on this article

Be the first to comment on this article

Related research

Thai Beverage PLC (World)

Thai Beverage, the world’s fifth largest spirits producer in sales volume terms, is working to develop its spirits portfolio in a premium direction in order to adapt to evolving conditions in its domestic market and to facilitate international expans...

Thai Beverage PLC (Alcoholic Drinks)

Thai Beverage, the world’s fifth largest spirits producer in sales volume terms, is working to develop its spirits portfolio in a premium direction in order to adapt to evolving conditions in its domestic market and to facilitate international expans...

Related articles

Comment - Spirits - Scotch: It’s Scotland’s Water

This month, Ian Buxton takes a look at an idea that, should it come to fruition, will send shockwaves through the Scotch whisky industry. In Scotland, he notes, there seems to be water, water everywhere, but not a drop that is taxed. Yet.

just the Round-Up - The week in drinks

The top ten stories published on just-drinks last week:

AFRICA: Diageo appoints new marketing and innovation boss

Diageo has appointed a new marketing and innovation director for its Africa division.

just-drinks tagline

Not a member? Join here

Decrease font sizeDecrease font sizeDecrease font size Increase font sizeIncrease font sizeIncrease font size Comment on this article Email this to a friend Print this page