Kooksoondang, which is required to provide Country of Origin Labeling (COOL) for liquor materials starting August, is boosting efforts to promote sales of makgeolli by touting the fact that the alcoholic beverage is made purely from domestic rice.
This year Kooksoondang set a strategy to expand its market share while promoting the differentiated advantage of traditional liquors made from domestic rice.
As a result, Kooksoondang released “Kooksoondang makgeolli made purely from domestic rice” and undertaken a massive effort to promote the brand. A source from the company said that the brand new alcoholic beverage is differentiated due to its use of purely domestic rice harvested over the last year.
It is reported that makgeolli made purely from domestic rice costs Kooksoondang an additional 4 billion to 5 billion won each year. Not surprisingly, the price has been raised to 1,500 won per bottle, 300 won higher than makgeolli made from imported rice.
Kooksoondang plans to undergo aggressive marketing in order to increase sales of the brand new liquor product. In this context, Kooksoondang recently conducted a free-of-charge taste test at six mountains around Seoul, including Mt. Kwanak, Mt. Dobong and Mt. Surak.
Kooksoondang currently provides makgeollli to five-star hotels, golf courses, high-end traditional Korean restaurants, massive shopping malls and baseball stadiums. Furthermore, the liquor maker is set to begin advertising on TV.
Kooksoondang President, Bae Jung-ho said that makgeolli made from domestic rice with the use of advanced technology accumulated from manufacturing makgeolli using imported rice, proved much better, adding that they are currently analyzing why.
Preisdent Bae said that the company plans to replace “Kooksoondang makgeolli” which reported sales of approximately 30 million bottles in just one year since its launch in May 2009 with “Kooksoondang makgeolli made from domestic rice.” However, he said that many employees opposed the plan, saying that the higher price would affect sales in an increasingly competitive traditional liquor market. His daring move is even being called nonsensical by some employees given that “Kooksoondang makgeolli” is being sold in larger numbers each month.
However, President Bae seems resolute. He is certain that quality, rather than price, will play a decisive role in appealing to consumers in the makgeolli market, emphasizing that Kooksoondang will emerge as a trend-setting company in the traditional liquor market. He claims his decision comes from entrepreneurial acumen rather than simple, blind patriotism, adding that he calculates that if Kooksoondang, the nation’s second largest traditional liquor maker, moves forward with producing makgeolli from domestic rice, competitors will follow suit.
Kooksoondang estimates that more than 14,000 tons of domestic rice will be used to produce makgeolli each year. Given that the number reached 7,000 tons last year, this represents a significant increase in the use of domestic rice. If other competitors are assumed to join the move, it is expected to result in a rapid increase in the consumption of domestic rice.
While admitting that Kooksoondang’s move is unlikely to change the entire landscape of makgeolli consumption once and for all, president Bae Jung-ho added that he nevertheless remains resolute about winning over distributors as well as retailers.