OB Beer Joins the "Soju War" With Challang, Leveraging Strong Nightlife Sales Network

Cass Distribution Power: Sales Focused on Restaurants and Bars
Silent Marketing in Seoul and the Metropolitan Area
No Celebrity Endorsements Used

OB Beer, which holds the largest market share in the Korean beer market, has officially launched “Challang,” a Jeju soju, joining the ongoing “soju war.” Leveraging its extensive distribution network among entertainment venues, OB Beer is now taking on the soju market, and many are watching closely to see if it can challenge the current duopoly dominated by HiteJinro and Lotte Chilsung Beverage.

According to the liquor industry on September 30, OB Beer officially released “Challang,” a zero-sugar soju, on September 28. It is currently sold only at selected restaurants and bars in Seoul, the greater metropolitan area, and parts of Jeju. Rather than focusing on home distribution channels, the company aims to test its potential entry into the soju market by leveraging its already-established sales network in the nightlife sector.

As of last year’s cumulative sales, HiteJinro and Lotte Chilsung Beverage together account for 83% of the domestic soju market, with HiteJinro holding about 66% and Lotte Chilsung Beverage 17%. Against this backdrop, OB Beer’s strategy is to use Challang as a testbed for the soju market. Instead of a nationwide rollout, the product will be sold primarily in Seoul, the metropolitan area, and Jeju, while the company observes market trends closely for three to four months.

OB Beer is taking advantage of Challang’s “scarcity” to make its foray into the soju market. The product is available only at 8,000 to 10,000 key restaurants and bars in major business districts such as Gangnam, Yeouido, Yongsan, and Hongdae. Given that the production capacity of the Jeju factory producing Challang cannot cover all of OB Beer’s Seoul and metropolitan distribution channels, the company is foregoing aggressive marketing from the outset. Instead, it is hoping for buzz to drive consumers to seek out the establishments carrying Challang.

Additionally, OB Beer has skipped the typical strategy of recruiting popular celebrities as models for its new product launches, which is customary in the liquor industry. This is in stark contrast to HiteJinro, which fronts top stars such as BTS’s V and IU as models for its Jinro and Chamisul brands. For this reason, some consider Challang to be closer to a limited edition than a standard new product.

Industry experts note that OB Beer’s approach could be a double-edged sword. While Challang may enjoy sensational popularity and even sell out in its early days, breaking the deeply rooted loyalty and duopoly in the soju market is no easy feat.

There is also skepticism over whether OB Beer can overcome the obstacles faced by other Jeju soju brands. Shinsegae Group, which rode the Jeju soju craze and acquired Jeju Soju in 2016, introduced ‘Pureunbam.’ However, cumulative operating losses from 2017 to 2020 reached 43.4 billion won, and the company halted domestic sales in 2021. Hallasan Soju’s sales have also been on the decline, dropping from 24.6 billion won in 2022 to 22.1 billion won in 2023, 21.5 billion won in 2024, and 21.3 billion won last year.

However, while Shinsegae Group and Hallasan Soju struggled to expand their restaurant and nightlife sales networks in Seoul and the metro area, OB Beer already owns the nation’s most powerful beer network through Cass. This gives OB Beer a faster starting point for expansion than previous Jeju soju brands. An industry insider commented, “The scarcity and popularity of Jeju soju in Seoul and the metro area have already faded. For Challang to succeed, it must be promoted as a complement to Cass, targeting occasions where both are consumed together. Whether Challang can create synergy with Cass as a ‘somaek’ (soju-beer mix) will be crucial.”

This content was produced with the assistance of AI translation services.