"They say it's G-Dragon and Ha Jung-woo's liquor!" Crowds rush in, sparking a sellout frenzy...which one turned "flash-in-the-pan popularity" into a long-term hit?

"Fleeting Celebrity-Liquor Craze" Puts Inventory to the Test
G-Dragon Highball Monthly Sales Fall
to One-Tenth of Their Peak
Concentrated Initial Demand Makes Production and Inventory Management Crucial
IP Revenue-Sharing Models Also Vary

Alcoholic beverages launched under celebrity names and marked by sellout frenzies early on are facing the challenge of managing inventory and production volumes as time passes. A celebrity's name recognition and fan base can help secure initial demand, but sales can then slow rapidly, forcing manufacturers and distributors to adjust production and order volumes. Products whose supply was increased to address early shortages, in particular, require accurate ongoing demand forecasts, industry observers say.

According to the convenience store industry on Nov. 2, the monthly sales volume of G-Dragon's "PEACEMINUSONE Highball," launched by CU, the convenience store chain operated by BGF Retail, in April last year, has fallen to one-tenth of its peak. CU says that, 18 months after its launch, the product has effectively entered the inventory sell-through stage.

Sales top 10 million cans amid early shortages...then plunge over time

The contrast is striking given the product's early sales. PEACEMINUSONE Highball sold out its initial shipment of 880,000 cans within three days of launch, prompting CU to immediately produce an additional 120,000 cans on an emergency basis. Demand continued, and cumulative sales of the original product surpassed 5 million cans in early June last year. According to manufacturer Buru Guru, cumulative sales of the three products, including follow-ups Red Highball and Daisy Highball, exceeded 10 million cans by late July last year.

Sales have slowed at other convenience store chains as well. At GS25, operated by GS Retail, it takes as little as three months for sales of celebrity collaboration products to fall to half their peak levels. However, some products maintain high sales for more than six months, indicating substantial differences from product to product, the company says.

A GS25 representative said, "Demand for new products that have recently become a hot topic tends to be concentrated over a short period through social media (SNS) and other channels, and this applies not only to celebrity collaboration products." In other words, whether the buzz surrounding a product at launch translates into repeat purchases determines its long-term sales.

Some products, however, have converted early success into sustained sales. "Makiki Sauvignon Blanc," a wine launched by Seven-Eleven in collaboration with actor Ha Jung-woo, sold 200,000 bottles within three weeks of launch, followed by cumulative sales of 450,000 bottles in six months and 700,000 bottles in one year. Although sales slowed compared with the initial period, another 250,000 bottles were sold after the first six months.

After launching "Black Circle Whisky" in collaboration with broadcaster Shin Dong-yup, Seven-Eleven also introduced its follow-up product, "Black Circle MAX." This is a strategy of building a brand through follow-up products rather than relying on a one-off hit with a single product.

Slowing sales bring inventory and promotional burdens...cost management challenges for manufacturers and distributors

With sales results varying across celebrity collaboration alcoholic beverages, manufacturers' and distributors' production and ordering strategies are becoming increasingly important. A celebrity's name recognition, along with the scarcity created by limited sales or early shortages, can spur purchases, but these incentives may weaken as supply expands. If production is ramped up based on sales immediately after launch and actual demand then drops quickly, the inventory burden can grow.

According to the Financial Supervisory Service's Electronic Disclosure System, BGF Retail's consolidated inventories rose from KRW 212.3 billion at the end of 2024 to KRW 215.6 billion at the end of last year, then increased to KRW 233.3 billion in the first half of this year. GS Retail's inventories also rose from KRW 307.1 billion to KRW 337.3 billion over the same period, then increased to KRW 368.6 billion in the first half of this year.

Inventory turnover, which indicates how quickly a company sells its inventory, is also trending downward. BGF Retail's inventory turnover fell from 36.3 times in 2024 to 34.5 times last year and an annualized 32.9 times in the first half of this year. GS Retail's figure also declined from 29 times to 28 times and 26 times over the same periods. A decline in inventory turnover means that it is taking longer to sell goods and convert them into cash. These figures cover each company's total inventory and do not isolate the impact of weak sales of celebrity collaboration alcoholic beverages.

Convenience store chains are adjusting order volumes and product operations in response to sales trends. CU is discontinuing products whose sales have fallen sharply and holding promotional events to clear inventory. The convenience store operator bears the promotional costs incurred in this process. GS25 also said it manages products by considering purchase volumes, sales trends, inventory levels and other factors together.

Collaborations continue despite inventory burdens...drawing customers with fan bases and differentiated products

Fees for using celebrity intellectual property (IP) and revenue-sharing arrangements vary by product. The manufacturer that actually produces the product enters into the relevant contract, while the distributor purchases and sells the finished goods. The manufacturer may pay the IP fee upfront or pay royalties tied to sales. In that case, the manufacturer may bear the costs related to the IP and production, while the distributor may bear the costs of purchasing the products and managing sales and inventory.

The actual allocation of costs, however, depends on factors such as how the products are purchased, whether returns are allowed and how promotional costs are shared. If a distributor's sales slow after it has purchased finished products, it may incur costs for discounts to clear inventory or for managing the products. Conversely, a manufacturer that already holds produced goods or inventories of raw materials and packaging may also face costs when adjusting production. Both parties benefit from the promotional impact of early success, but the risks when sales slow can fall differently on each, depending on the contract terms.

Ha Jung-woo's wine, Makiki Sauvignon Blanc. 7-Eleven.

Convenience store chains are rolling out celebrity collaboration alcoholic beverages in succession because securing products that differentiate them from competitors can encourage consumers to visit their stores. Products available only at a particular convenience store can attract customers, and leveraging a celebrity's fan base and popularity can also quickly raise awareness of a product at launch.

An industry official said, "One advantage of celebrity collaboration products is that they can reflect each celebrity's personality and distinct qualities. They can draw consumers' interest and participation through their fan bases, while generating buzz that raises product awareness and purchase demand."

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