Popular bars across Asia are facing some tough times during the Covid-19 pandemic. Lockdowns and restrictions that have been instated by governments are squeezing alcohol sellers.
Fewer drinkers, changing consumer tastes, tightening restrictions on alcohol and the pandemic is a sober reality for the industry. But companies have the chance to capture a new generation of customers if they can mix the right cocktail to appeal to changing tastes.
Asahi Group Holdings, a top Japanese beverage maker, said in December that its beer subsidiary will increase non-alcoholic and low-alcoholic drink sales volume to 20 percent of its portfolio by 2025, or more than three times in 2019.
“The number of consumers who want to drink non-alcoholic beverages is increasing,” Akiyoshi Koji, Asahi Group Holdings CEO, said in an interview with Nikkei Asia, suggesting the trend was accelerating as virtual social gatherings replace physical get-togethers during the Covid-19 pandemic.
Looking at South Korea, makes of soju, or distilled liquor, are coping with changing market trends by increasing mildness. Hitejinro, the biggest soju maker in the country, has been lowering alcohol by volume, or ABV, almost every year recently for its benchmark soju brand Chamisul Fresh to 16.9 percent in 2020 from 19 percent in 2012.
Hitejinro said that the company has opted to cut ABV as consumers have stated that they want a milder liquor they can enjoy at home during the pandemic. Homemade soju cocktails are increasingly popular, especially among the millennial generation, a contrast with elders who tend to enjoy stronger liquors during social events such as company dinners.
The trend comes as South Korea has been in the process of tackling a culture of overwork with legislation that slashed the maximum workweek to 52 hours from 68 for some large companies. That means fewer late toiling office workers, thus decreasing opportunities for company dinners with heavy drinking.
In contrast to aging and shrinking markets like developed countries in Northeast Asia, drink makers had been seeing big potential in Southeast Asia, especially Vietnam with a young and increasingly middle-class population.