Soju Market

Soju Market Size and Forecast (2023-2028):

The Global Soju Market size is expected to grow at a CAGR of 2.54% during the forecast period 2023-2028 to reach USD 3679.1 million by 2028 from USD 3165.1 million in 2022.

Market Overview:

Soju is a popular alcoholic drink in Korea made from rice, wheat, barley, and sweet potatoes. It is a clear, colorless, and distilled spirit that tastes sweet. Soju is an integral part of Korean drinking culture, consumed at parties or social gatherings. It is often enjoyed with meals; soju is known for its smooth and easy-to-drink taste. It has 20% to 25% alcohol content. But it can content as low as 17% alcohol or high as 45%. Soju is part of a culture and deeply ingrained in the country’s culture; Soju is mostly confused with rice wine, although it is different in taste and texture.

Recent Developments in the Soju Industry:

• On 17th April 2023, Tiger®, renowned across Asia, introduces its latest creation, the Tiger Soju Infused Lager, marking a significant milestone as the brand's most remarkable innovation. To enhance this exciting launch, Tiger® proudly introduces the Official Global brand ambassador, the celebrated icon G-DRAGON. This collaboration promises to make a substantial impact and elevate the brand's presence worldwide.
• In March 2023, The Mackiss Co., a South Korean liquor company located in Chungcheong Province, the country's most beloved alcoholic beverage, expanded its business by introducing a product with an alcohol by volume (ABV) below 15 percent. This innovative offering will captivate the market and appeal to a wider range of consumers.

REPORT COVERAGE:

Drivers:

A major significant driver increasing the soju market demand is the cultural significance of soju in Korea. Soju is an essential part of Korea’s culture and an imperative part of drinking culture. Soju is a part of social gatherings and parties and acts as a medium for social bonding. For centuries it has played a central role in various traditional and modern settings. Beyond the social circle, soju has become a business culture in Korea, with many manufacturing industries set up. Hence this has caused an exponential rise in the market demand for soju and led to an increase in the soju market shares.

This cultural significance of soju is extended beyond the borders of Korea due to the internet and digitalization; social media and over-the-top platforms have become a medium for the market expansion of soju. Also, popular Korean music, drama, and cuisine further contributed to the demand for soju worldwide. Korean restaurants have become popular, soju has been adopted internationally. And as Korean culture continues to influence globally, the soju market share continues to expand exponentially.

Another factor that contributed to the increase in market size is aggressive marketing and promotional strategy; soju manufacturers have leveraged various marketing channels to reach consumers globally to establish a brand presence. One of the marketing strategies that played a pivotal role in digital marketing, social media platforms have been used to engage consumers in establishing content to portray soju as a fun and social drink. This strategic partnership also helped Soju to penetrate urban culture. Moreover, packaging design and induced flavor have allowed manufacturers to diversify their product offerings and attract consumers.

Restraints:

The increasing consumer health consciousness has become a restraining factor impacting the alcoholic beverage industry, including the soju market value. Consumers are becoming more and more aware of the ill benefits of alcohol and the health risks associated with it. Soju contains high levels of alcohol, which raises concerns among health-conscious individuals. Excessive alcohol consumption can lead to cardiovascular disorder, liver damage, and an increased cancer risk. Therefore, this has caused a decrease in the market demand for soju and led to a decline in the market size.

Furthermore, health-conscious people seek transparent products in labeling and product information. Therefore, manufacturers producing soju must address these concerns and provide detailed information on the content with potential health risk. Hence shift in preference among consumers for healthier lifestyles created a challenge for soju market demand.

Opportunities:

With the increase in online retail stores and e-commerce, soju manufacturers can utilize this opportunity to expand the brand globally, ass life of consumers have become easy due to the presence of online stores. The online presence of soju can increase the market demand as well as its market size. E-commerce platforms will enable consumers from different parts of the world to access soju, and this global accessibility will cause the international presence of soju. Hence digitalization has provided growth opportunities for the soju market.

Furthermore, soju is available with high alcohol content, which makes it difficult for consumers who prefer low alcohol content; with this, manufacturers of soju reduce the alcohol content with more flavor addition to attract consumers who usually don’t prefer the typical taste of soju.

COVID-19 Impact on the Soju Market:

The outbreak of COVID-19 had a significant impact on the soju market growth; with the implementation of lockdown and restrictions, many restaurants and social gathering was halted, which caused a decline in the demand for soju. Also, with more and more people avoiding getting social and confined to their homes, the purchase of soju was decreased. Moreover, with increased awareness of health and wellness and boosting the immune system, soju consumption decreased because of its alcohol content. Moreover, due to a complete restriction on tourism, South Korea, a highly visited tourist spot, saw a decline in tourist visitors. Soju, a part of Korean culture and cuisine, was purchased as a souvenir by tourists, and with the decline in international tourism, the demand for soju diminished. Therefore, the pandemic negatively impacted the soju market share in 2020, whereas the market is growing rapidly as the world is setting into a normal situation post-COVID-19 pandemic.

Soju Market Segmentation Analysis:

By Product type:

• Distilled Soju
• Diluted Soju

Distilled soju has the highest market share; this is due to distilled soju being the traditional and original type of soju made through a distillation process similar to that of vodka. And has higher alcohol content; distilled soju has a clear and smooth taste. At the same time, diluted soju is new in the market and a milder variation of soju. It is made through a different production process, typically by dilution with water or other ingredients to reduce the alcohol content. Diluted soju has a lower alcohol content, usually around 14% to 17%, and added flavors to cater to consumers who prefer less alcohol.

By End-User:

• Below 20 Years Old
• 20-40 Years Old
• 40-60 Years Old
• Above 60 Years Old

The 20-40 years segment holds the highest market share, and this is because soju is preferred by many youths as a social drink at gatherings and parties. The 20-40 age group of people are young adults, and soju acts as an integral part of fostering social connections, and it serves as a means to bond with friends, colleagues, and family members. Also, this age group passes the legal drinking age, which contributed to this age group dominating the soju market. The 40-60 age group has the largest market share; since it is most likely susceptible to illness and disorders, it usually prefers soju with low alcohol content.

Geographical Segmentation Analysis:

• North America - the United States and Canada
• Europe - United Kingdom, Spain, Germany, Italy, and France
• The Asia Pacific - India, Japan, China, Australia, Singapore, Malaysia, South Korea, New Zealand, and Southeast Asia
• Latin America  - Brazil, Argentina, Mexico, and Rest of LATAM
• The Middle East and Africa - Africa and Middle East (Saudi Arabia, UAE, Lebanon, Jordan, Cyprus)

By Region Analysis:

Based on the region, the Asia Pacific region has the highest market share and generates the maximum revenue. In Asia Pacific, South Korea is the largest consumer of soju. Since soju originated in South Korea and is an integral part of the culture and social gatherings, it is a popular drink among youths and often enjoyed with cuisine. This has caused an increase in the market size of the soju market in the Asia Pacific region. North America has the largest market share due to growing social media and cultural expansion; the youth has widely accepted soju due to the acceptance of Korean culture. Europe is also seeing growth in the soju market due to media and the expansion of Korean culture.

Moreover, the increase in online e-commerce sites also contributed to the market size of the soju market. Latin America is also seeing market growth. Middle East and Africa have the lowest market share compared to other regions, has most middle eastern countries have bans on alcohol and alcohol products.

Key Players in the Market:

Major Key Players in the Global Soju Market are

• HiteJinroLotte Liquor
• Muhak
• Kumbokju
• C1 Soju
• Bohae
• Chungbuk
• Hallasan
• Mackiss
• Andong