Beer registered a polarised performance following the outbreak of COVID-19, with on-trade sales plummeting while off-trade sales saw double-digit growth in volume terms. After the introduction of a lockdown, South Korea saw a growing trend towards 'Home sool', which refers to drinking alone at home, with consumers unable to drink in on-trade establishments.
Whilst Oriental Brewery retained its dominant position in 2020, the second ranked player Hite Jinro took some of its share thanks in part to the positive performance of its domestic mid-price beer brand Terra which attracted sales from the younger generation. Launched in 2019, the new brand has successfully created a young and fresh image with a distinctive bottle colour, while also benefiting from the use of popular celebrities in its marketing.
Non alcoholic beer was the most dynamic category in 2020. Beer manufacturers have caught on well to the increasing interest in health and wellness, especially since COVID-19, and introduced several new non alcoholic beer brands into the market at the end of the review period.
On-trade sales of beer are likely to remain deflated in 2021 as the country continues to try and manage COVID-19 and the rolling out of its vaccination programme. For the retail channel, domestic lager is expected to continue growing, with the strong home sool trend supported by the increasing number of beer SKUs.
Craft beer is expected to see further expansion over the forecast period as consignment production such as original equipment manufacturer (OEM) will be allowed, in line with the measures to improve alcohol regulation which were announced by Ministry of Strategy and Finance of Korea. This change in regulation would help both existing big breweries and small craft brewers.
As the impact of COVID-19 continues to be felt in 2021, beer manufacturers are expected to focus more on product development for retail products with improved packaging. Innovative packaging such as sleek cans (slim type 330ml aluminium cans), transparent glass bottles, or small PET bottles will likely become popular.
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This report originates from Passport, our Beer research and analysis database.
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