Budget whiskey sales surge in South Korea amid inflation and home drinking trend

Amidst soaring inflation and a general decline in alcohol consumption, the South Korean whiskey market is experiencing a significant shift towards more affordable options. The popularization of 'home drinking' and mixed beverages like highballs has fueled demand for budget-friendly whiskeys, challenging the traditional perception of whiskey as an expensive, premium spirit.

Convenience store chain Korea Seven reported that its 'Black Circle' whiskey series has surpassed one million bottles sold. The original 'Black Circle,' priced at 19,000 won (approximately $14), has sold about 850,000 bottles since its launch in February last year. Its upgraded version, 'Black Circle MAX' (23,900 won, or $17.50), launched just last month, has already sold 150,000 bottles, averaging nearly 4,800 bottles daily.

This trend is reflected in sales data across major retailers. At Seven Eleven, products priced under 30,000 won (about $22) now account for 76.9% of all whiskey sales, a dramatic increase from 37.5% in 2021. CU reported that over half of its whiskey sales in the first five months of this year came from products under 50,000 won ($36.50). GS25 saw a 20.8% rise in sales for whiskeys in the 10,000 won ($7.30) range during the first two months of this year compared to the previous year.

However, the broader whiskey industry faces considerable headwinds. Golden Blue, South Korea's largest whiskey producer, saw its first-half revenue drop by 27.4% year-on-year to 43 billion won ($31.5 million), incurring an operating loss of 3.3 billion won ($2.4 million). Overall whiskey imports have also decreased, falling 26.2% over the past two years to 22,582 tons in 2023, with a further 24% drop in the first seven months of this year. The industry anticipates further challenges as the Ministry of Health and Welfare mandates the display of drunk-driving warnings on alcohol labels starting in November, potentially impacting sales and increasing costs for label redesigns, especially for brands popular among collectors.